Welcome to Parcelconsulting
Welcome to Parcelconsulting
Subscription boxes are all the rage right now. Forbes reported that 37 million consumers visited subscription box websites in 2017 (up 800% from 2014) and there has been substantial growth since then. There are now 5.7 million subscribers across more than 2,000 subscription boxes that range from beauty products to dog treats to CPAP supplies. If you think every niche interest has its own subscription box, you’re more or less correct.
New subscription box sellers often get lost somewhere between the ideation and the logistics, but we’re here to help. These are the best tips for shipping subscription boxes.
Let’s start with the easy stuff: What is a subscription box? A subscription box is a regular delivery of items chosen by curators to fit a certain theme. For example, BarkBox delivers dog toys and treats, FabFitFun delivers lifestyle products and Butcher Box delivers premium meats. Most subscription boxes are delivered monthly, while others arrive every other month or every three months. Additionally, items can range from convenient, like Quip electric toothbrush heads, to discoverable, like Universal Yums international snacks. It all depends on what kind of box you want to deliver.
Every subscription box starts with an idea. Successful subscription boxes are carefully curated to match a niche interest, so sellers should define their themes and ideal customers before sourcing products. Both of these steps will help to determine pricing for the box, which should aim for a 40% profit margin after the costs of the products, the packaging materials and the fulfillment. Once the price has been set, you can put together a prototype box and use it for marketing materials. This will help you gather subscribers during your pre-launch phase, which should be 15-60 days before sending out the first box.
Pre-launch is also when you need to develop a subscription box fulfillment strategy, and it’s when we step in. Here are some tips for shipping subscription boxes.
Shipping is the backbone of your subscription box operation, and it impacts both you and your customers. Getting the best experience is key, which is why it’s important to evaluate the best shipping carriers for subscription boxes before committing to any of them. Generally, your options are USPS, UPS, FedEx and DHL. Each is slightly different from rates to technology to availability, though all of them will get the job done. Let’s break down each carrier so you can see what we mean.
The USPS has the safest, most reliable and most widespread shipping network within the country. It has a mandate to deliver to all residential and commercial addresses, so you can be sure your boxes will get to subscribers no matter where they are. USPS also offers the lowest rates for packages under two pounds, and their cubic pricing structure results in competitive shipping rates for packages up to 20 pounds. Finally, the Postal Service has the highest cleanliness standards of the major carriers, so your subscription boxes will typically arrive without dents or scuffs.
UPS is another shipping powerhouse known for reliability and professionalism. Its rates are usually more expensive than those offered by USPS, but it has strong domestic deliverability and a convenient tracking system. The shipping dashboard is fairly intuitive, and staff are always on hand to offer solutions, if needed.
FedEx’s original claim to fame was its Next-Day Air service, but now it’s praised for its simplified shipment tracking dashboard and its SmartPost pricing. SmartPost is a partnership with USPS, and it’s an affordable option to deliver bulky and low-weight packages to all US states, APO, FPO and DPO addresses. However, orders can take 12-14 days to arrive.
The main advantage of DHL is its international delivery network that spans 220 countries and 12,000+ locales. Though DHL’s shipping rates are typically lower than those offered by UPS and FedEx, deliveries are often delayed. The tracking dashboard also has a poor user experience.
In most cases, USPS is the best carrier for shipping monthly subscription boxes. Great rates, efficiency, tracking accuracy and delivery truck cleanliness ensure you’re getting the most out of your spend and—more importantly—provide a top tier experience for your customers.
A major advantage of selling subscription boxes is that you can utilize order consolidation to reduce shipping costs. By shipping out all your subscription boxes in the same time frame, you save the time and hassle of organizing order fulfillment for each individual package. Your boxes are shipped with other brands’ packages that are going in the same direction.
There are a few benefits of consolidating subscription box shipments. First is saving money by using less packaging, which reduces dimensional weight and is more eco-friendly. You also pay fewer handling fees per package, and fewer touchpoints also means less chance of damage. Finally, there is improved quality control because you can review your entire shipment at once before it leaves your warehouse.
Most subscription box brands start out fulfilling orders using their own resources, also called in-house fulfillment. This helps to save costs, improve efficiency as a team and ensure quality control. When your business scales, however, you’ll need to look into outsourcing fulfillment. Outsourcing isn’t easy. You give up a certain element of control, so you need to trust your fulfillment partner. Here’s how to ensure you’re leaving your fulfillment in expert hands.
First, look for a fulfillment company that already serves other subscription box brands. From assembly to accurate shipping to kitting services, these companies will understand your needs from day one. Second, make sure they can handle large inventory volumes. Your subscription boxes are only as good as the products in them, so the products need to be on hand for a smooth shipping process. Third, look for fulfillment companies that have strong working relationships with shipping carriers. This means one less piece of the logistics puzzle that you have to handle, and you may even get discounted shipping rates.
The subscription box market has become flooded with sellers offering an array of niche boxes, but that doesn’t mean there’s no room for you and your ideas. It simply requires a more strategic approach to growth to ensure sustainability.
Influencer marketing is one popular tactic to grow subscription box brands. By working with social media influencers or subscription box bloggers, you can tap into new audiences. These audiences already trust the public figures they’re following, so your brand gets automatic endorsement.
Referral programs are another way to grow your subscription box business. Simply give each customer a unique code, and reward them for sharing it. You can each referrer with a discount code for their next box, or you can promise a free box if five of their friends sign up. This is (almost) free marketing and is a powerful way to grow your business because people trust their friends more than they trust marketing messages.
Despite this, digital marketing still works. Utilize email marketing, social media and our killer ecommerce SEO tips for low-cost ways to get the word out about your brand. The easier you make it for new prospective customers to discover your subscription box, the more opportunities you’ll have to get new signups.
Parcel Consulting has aggregated and partnered with the best options for same-day, next-day local delivery in the United States and Canada. We work with businesses of all types and sizes to provide the best tailored local delivery options and technology for their needs.
We’ve been preparing for this for more than a decade and we’re here to help! Give us a ring to discuss your options at: 833-PARCEL-1 (833-727-2351).
