How to work out delivery charges

You charge $9 for delivery because the label on the last one came to $8.90. Then you count up the month and you're down $600, and nothing on your product page changed.

The delivery charge is not the postage. It's postage plus the box plus the tape plus the label plus the six minutes it takes you to pack the thing, and it has to be worked out per weight band rather than once for everything. Here's the arithmetic, in the order you should do it: find your true cost per parcel, sort your parcels into three or four weight bands, price each band, then decide whether you're willing to eat some of it to keep the checkout clean.

The number you're actually looking for

Postage is the line everybody sees. It's usually between 60% and 80% of the real number, and the rest is the part that never shows up on a receipt.

Take one parcel, the one you send most often, and fill this in with your own numbers:

Line	What to count	Dana's mug, Portland
Carrier label	What you actually paid, after any discount	$8.90
Outer box or mailer	Price per unit at the quantity you buy	$0.95
Void fill, wrap, tissue	Per parcel, not per pack	$0.60
Tape, label sheet, thank-you card	The bits you forget	$0.30
Your packing time	Minutes x your hourly rate	6 min at $22/hr = $2.20
True cost		$12.95

Dana sells stoneware mugs at $34 from a spare room in Portland, Oregon. She'd been charging $9. She was losing $3.95 on every single-mug order and didn't know it, because the only number she'd ever looked at was the one the carrier charged her.

Two of those lines cause the most arguments.

Packing time is a real cost even though nobody bills you for it. Six minutes is a normal, unhurried single-item pack. Forty orders a month is four hours. Four hours is most of a Saturday morning, and if you won't count it at your own hourly rate, count it at what you'd pay someone else to do it.

Buy packaging at the quantity you actually use. A box that costs $2.40 in a pack of ten costs $0.95 in a pack of two hundred, and the two hundred will not go off. This is the cheapest saving in the whole article and most sellers put it off for a year.

Weigh the parcel, not the product

The mug weighs 1.1 lb. The packed parcel weighs 1.4 lb. Carriers charge for the parcel.

Then there's the second measurement that catches people out: volumetric weight, sometimes called dimensional weight. Carriers charge for the space a parcel occupies as well as what it weighs, and they bill you on whichever is higher. The sum is length x width x height, divided by a number the carrier sets.

Dana's four-mug box is 12 x 10 x 8 inches, which is 960 cubic inches. The divisor on her account is 139, so the volumetric weight is 6.9 lb. The parcel actually weighs 4.6 lb. She gets billed on 6.9.

That gap is why bulky-but-light products are brutal to ship and why cutting one inch off a box height is sometimes worth more than switching carrier. Find your divisor before you buy your next thousand boxes. It's on your rate card, and it varies by carrier, by service and by whether you're measuring in inches or centimetres.

Weigh ten packed parcels and measure the boxes. That's a twenty-minute job that will change what you charge.

Bands, and where to put the cuts

Once you have a true cost per parcel, you need bands, because the difference between your lightest and heaviest order is bigger than you think.

Look at your last fifty orders and sort them by packed weight. You'll almost always see clusters rather than an even spread, because people buy one, or they buy a set. Put your band cuts between the clusters, not at round numbers.

Dana's three clusters, her true cost, and what a sane charge looks like:

Band	Packed weight	What it is	True cost	Charge
A	up to 2 lb	One mug	$12.95	$13
B	2 to 3.5 lb	A pair	$16.60	$17
C	3.5 to 7 lb	Set of four	$23.10	$23

Now look at what she'd been doing instead.

Why one flat rate quietly loses money

Over a hundred orders, Dana's mix was 62 singles, 24 pairs and 14 sets of four. At a flat $9:

Band	Orders	True cost each	Cost	Charged	Collected	Gap
A	62	$12.95	$802.90	$9	$558	-$244.90
B	24	$16.60	$398.40	$9	$216	-$182.40
C	14	$23.10	$323.40	$9	$126	-$197.40
Total	100		$1,524.70		$900	-$624.70

Those hundred orders were $5,352 of goods. The delivery gap alone is 11.7% of her revenue, and it doesn't appear anywhere in her head as a cost, because each individual label looked fine when she paid it.

Banded, the same hundred orders collect $1,536 against $1,524.70 of cost. She's flat instead of $625 down, and she did it by changing three numbers in a settings page.

Now the part that actually matters, and the reason flat rates fail even when you set them carefully. Your flat rate is only correct for one product mix, and the mix moves.

Suppose a reel does well and the set of four takes off, so the next hundred orders are 40 singles, 20 pairs and 40 sets. Same products, same prices, same $9 flat rate:

Band	Orders	Cost	Collected
A	40	$518.00	$360
B	20	$332.00	$180
C	40	$924.00	$360
Total	100	$1,774.00	$900

A $874 gap instead of $625. She sold the same number of orders and lost an extra $250 purely because of which ones people picked, and every one of those set orders felt like a good day.

That's the whole case against a flat rate on a range of weights. It's not that it's wrong on average. It's that it's a bet on a mix you don't control, and it pays out worst exactly when a heavy product starts selling well.

Zones: distance is the second axis

Weight is the first axis. Distance is the second, and most carriers price it as zones rather than miles.

If you ship nationally, band by weight and then check whether your zones diverge enough to matter. A rough shape, with placeholder numbers you should replace with your own rate card:

	Zone 1-2 (local)	Zone 3-4	Zone 5-8
Up to 2 lb	base	base + 15%	base + 40%
2 to 3.5 lb	base	base + 20%	base + 55%
3.5 to 7 lb	base	base + 30%	base + 80%

If your far-zone orders are under about one in ten, price everything at the middle zone and absorb the difference. Twelve rate rows is a checkout nobody understands and a spreadsheet you'll stop maintaining by October. If a third of your orders cross the country, split into two zones and no more.

Local delivery is a different calculation entirely, because you're paying a person for a trip rather than a carrier for a parcel. That maths is in delivering locally without a courier.

Three shapes, and who each one suits

Shape	Works when	Breaks when
One flat rate	Every parcel is roughly the same weight and size	You add a heavier product, or a bundle takes off
Banded by weight	Your orders cluster into two or three sizes	You've got fifteen bands and buyers pick the wrong one
Free over a threshold	Your margin is wide and your parcels are light	Your heaviest item is also your cheapest
Built into the price	You sell one thing at one weight	Local pickup buyers pay for delivery they didn't get

Free delivery gets its own decision, because it isn't a shipping question, it's a discount question. The margin sum is in should you offer free delivery.

The uncomfortable thing the numbers will tell you

When Dana priced her bands honestly, she got $13 delivery on a $34 mug. That's 38% of the item price, and it will not sell.

The instinct is to go back and shave the delivery charge. That's the wrong move, and it's the move almost everyone makes. The number isn't lying. What it's telling you is that a single $34 mug is not a viable unit to ship in a box that size, and there are only four honest fixes:

1. Raise the item. $39 with $8 delivery reads better than $34 with $13, and it collects $47 either way.
2. Change the box. A smaller carton and a corner protector instead of a big box and paper knocks the volumetric weight down and sometimes moves you a whole band.
3. Push the bundle. Make the pair the obvious buy, because the second mug adds $3.65 of cost and $30 of revenue.
4. Stop shipping the single. Offer it for local pickup only, or as a minimum order of two.

What you should not do is quietly absorb $4 a parcel for a year and call it marketing. Marketing is something you decide to spend. This is something that happens to you.

What Sailo does here, and where it stops

Sailo lets you set up as many delivery methods as you want. Each one is a type (shipping or collection), a name the buyer sees, a flat fee, an optional free-over-this-subtotal rule, and a free-text estimate like "2 to 3 working days". The buyer picks one at checkout, and the fee, the label and the estimate are all snapshotted onto the order so a later rate change can't rewrite what someone was charged.

Here's the limitation, and it's the one that matters for this article: the fee is a flat amount per named method. There's no weight table, no dimension lookup, no postcode zones and no live carrier rates. If you want bands, you create three methods called something like "Small parcel", "Medium parcel" and "Large box" and you rely on the buyer choosing correctly, which they sometimes won't. That's fine for a shop with two or three parcel shapes. It is not fine for a catalogue where every product weighs something different, and if that's you, you want a platform with a real rate engine and you should go and get one.

One more detail worth knowing if you take card payments: Sailo's 1–3% card commission is calculated on the goods after discount and never on the delivery fee. So folding $6 of shipping into the item price does add three cents to the commission on that order. It's small enough to ignore. It's not small enough to be wrong about, which is why it's here.

Do this before your next order goes out

Weigh ten packed parcels. Write the packed weight, the box dimensions and the label price for each one in a note on your phone. Add your packaging cost and six minutes of your time to every row.

That gives you a true cost per band by tonight. Set your rates from it tomorrow, then look again in a month and check whether the mix has moved, because that's the number that changes underneath you.

Once the money's right, the other half of the promise is time. What you can honestly tell a buyer about when it will land is in delivery times you can actually promise. If the courier is the part you're unsure about, start with choosing a courier you can trust. And if the first order from another country has just landed in your inbox, read shipping internationally for the first time before you print anything.