Shipping is by far the most overlooked part of crowdfunding. Your shipping strategy can make or break your campaign, so it’s important that you have a good one. Having a well-crafted fulfillment process can be the difference between shipping estimates crippling your campaign or fitting nicely within your budget. Below is a list of common problems our shipping partner, Easyship, has identified – and how to solve them.
Going Viral (Campaign Exceeds Expectations)
So you had a goal of US$20,000, but a famous YouTuber discovered your Indiegogo campaign and decided to share your brilliant product with their millions of fans? Great. You now have over US$1 million in funds. The problem? You only planned on meeting your goals of US$20,000 and aren’t quite sure how you’re going to handle the huge increase.
First thing’s first: you’re no longer going to be able to fulfill your orders from the spare room in your house or office. You will have to find a 3PL partner to manage warehousing and shipping your product. These partners are better equipped to handle large volumes and have more efficient processes that limit the amount of damaged or mispacked goods, thus leading to more satisfied backers.
Once a partner has been secured, it’s important to create an updated shipping timeline with production in mind. As you have exponentially increased your demand, funding, and backers without planning for such a volume, you’ll need to speak to your manufacturer and new 3PL to align your timelines in a way that’s reasonable for everyone involved. This could mean that you have to set an entirely new shipping date for when the entire inventory is ready or create monthly batches of orders based on the capacity of your factories. The most important thing is that you communicate with your backers to let them know that you’re grateful for their support and explain why there will be a delay in shipping their products.
Now that you have a warehouse partner and updated shipment timeline, you’re going to want to consider your ongoing marketing strategy. This is where post-campaign tools come in handy. These tools integrate with Indiegogo and assist in managing fulfillment, and also offers users the ability to gather more information about their backers, automate operations, and other various important elements of your campaign.
Choosing the Wrong Courier for your Budget
So you’ve done the hard work of reaching your campaign goal and have even planned to use 10% of your budget for shipping. But then you notice that shipping rates with global couriers such as FedEx and UPS are higher than you’d initially realized. How do you make sure your products still reach your backers in time?
Grab your scales and measuring tapes. The easiest solution to this problem could be adjusting the dimensions of your packages. It’s important to ask yourself if you’re packing your products as efficiently as possible. Could you save weight and space by better packing your boxes? By shedding some inches (or pounds), you could potentially make significant savings in your shipping budget. It’s also important that you understand the difference between “dead weight” and “dimensional weight.” You can find out more about this here.
Once your packaging is as efficient as possible, look into different courier solutions. There are hundreds of global shipping solutions, and many couriers offer the same benefits of big names like UPS and FedEx but at lower costs, especially when it comes to international shipping.
Choosing the Wrong Warehouse Partner
A revolutionary water bottle created by a New Jersey-based company has been shipping and storing their products in a local warehouse. But now that they’re getting backers from across the country and even Europe, shipping costs are getting too expensive. So how can they find a way to fulfill their orders at more affordable rates?
Like a real estate agent, our answer to this is location, location, location. This particular company has hit a critical mass with orders coming in from further afield, so it’s time for them to change their warehouse location. They need somewhere more central so that they can access standardized shipping rates throughout the company. In addition, this company needs to decide whether a 3PL warehouse in the European Union may be useful for them to avoid unnecessary taxes and duties and save on shipping costs. If you need more information about choosing a warehouse, you’ll want to read this Warehousing and Fulfillment guide.
Goods are Stuck in Customs or Packages are Lost, Stolen, or Damaged En Route
A fully-funded indiegogo campaign has been shipping internationally, but has been receiving a stream of customer complaints about products being damaged upon arrival, stuck in customs, or simply never arriving at their destination.
These issues are the result of so many different variables. Your best bet to combat these is to use a one-stop service like Easyship. This will allow you to generate shipping labels and commercial invoices, calculate duties and taxes to prevent customs issues, select a courier that offers high-quality tracking so that your customers will have peace of mind, and offer insurance in the event that your packages are lost, stolen or damaged. You can even create a shipping policy to protect your company from unnecessary liability. If you would like to learn more about the customs process, here is a great guide to navigating international customs.
Shipping “Dangerous’ Goods”
So you have a cool product that’s powered by a lithium ion battery? Great. The only problem is if it’s coming to the US from China, you may not be able to ship your products. These batteries are considered “dangerous goods,” which means many couriers won’t accept them for shipping.
Batteries can be tricky when it comes to shipping internationally because they can be hazardous to the container. Many regulations have been put in place to allay public safety concerns. One of the best ways to avoid any issues is to make sure that the battery is installed in the device you are shipping. This will allow it to comply with international shipping standards.
For an in-depth article on the shipment of dangerous goods, check out this overview of the dos and don’ts of shipping “dangerous goods.”
If you’re worried about the escalating trade war between the US and China, well, you’ve probably got good reason. Say you want to ship US$20,000 of goods from China to the US, you’d be right to think about how the trade war could affect you. So what should you do?
2019 has undoubtedly been a contentious year for trade. With tariffs continually increasing, the victims are small businesses who rely on countries like China to produce their products at an affordable price. That being said, there are, of course, ways to minimize how much these tariffs affect you. If your product is less than US$800, you can bulk-ship them to the US via air courier with Easyship’s “direct injection” method. This puts the shipment through 321 customs clearance, which clears each individual parcel under the end customer’s name, thus waiving duties and taxes.
So you have a good product funded by a great campaign, but you were overly optimistic about the manufacturing process and have now hit delays. What should you do?
Just like dating, customers don’t like being ghosted. It’s important to keep your backers up to date with any delays that may occur through your product journey. Backers appreciate transparency and are generally understanding about the issues that may arise with a crowdfunded startup. That being said, you want to make sure that you are well informed before making a communication. As a company, you must exude confidence and there’s nothing worse than giving your customers the wrong information. It’s recommended that you meet with your various stakeholders to create a strategy to get your project back on track and create aligned timelines before you let your backers know about any potential delays. As an added benefit, having open communication with your backers will build a strong customer-centric reputation that will only help you in the future.
That’s why Indigogo entrepreneurs have free access to an Easyship expert logistics consultation. The partnership between Easyship and Indiegogo gives entrepreneurs the necessary tools and services to bring their products to their customers, anywhere.