We all have heard horror stories about upset customers who make it their mission to badmouth a business for some personal wrong doing. Maybe even your business has felt that pain at one point. You are never going to make 100% of the people happy all the time. But as a business owner it is your responsibility to try to make every customer experience a positive one. Did you know there is a way to spend less than $1.00 to help stop upset customers?
We are a shipping insurance website so it goes without saying we are talking about shipping insurance. If you had the time to read about us and what we do, you will see our mission is to help you avoid losses from missing or damaged shipments.
If you compare policies and rates, you will see there are many options available for a shipper to access but why can it be so confusing? We hope that we offer understanding on how to protect you and your customers.
Online Shipping Insurance is a feature that is growing rapidly due to the fact that a high amount of shipments are being mishandled. There was an article back in 2013 about a study performed by Stella Service that was removed but we do have a copy here: https://www.shippinginsurance.shop/news/one-in-10-ecommerce-packages-arrives-damaged/.
Even though the original post was removed, it still has relevant information on shipment damages that you may find handy:
United Parcel Service (UPS) delivered the highest percentage of damaged packages of the three carriers evaluated at 11%. But it’s not all bad news — 19 companies had zero damaged packages in this study including behemoths like Rakuten.com, Target.com and Walmart.com.
Retailers negotiate an acceptable rate of damaged products with vendors, typically around 5%. But, damaged packaging service level agreements (SLAs) aren’t a common item in those contracts. And this study found that just 36% of the retailers evaluated had a damaged package rate of less than 5%.
Of the 313 damaged packages, 16 products were damaged, or 5%. If your customer isn’t already frustrated enough, now they’re dealing with a broken product that needs to be returned. Perhaps retailers should consider negotiating service level agreements for damaged packages.
Damaged Package Results By Carrier
So what about that less than $1.00 headline? simply put if you had added into your sell rate (or allowed a customer to select shipping insurance at checkout) you would only need $0.80 to insure a shipment worth $200. Small parcel carriers pay the first $50-$100 and we cover the second $100. Here is how we stack up:
COST PER COVERAGE BASED ON $100.00 DOMESTIC USPS & ALL RISK INSURANCE
As you can see, we offer the same ALL RISK coverage but at a much lower rate.
Do you use an eCommerce plugin? Do they add in shipping insurance? If so, you are overpaying for insurance coverage.
Either reach out to them to have us added as a provider or use our plugin for shipping insurance and save if they are not willing to switch for you. These companies that offer shipping rates are not allowing you to get the best possible rate for shipping insurance. It may seem trivial but let us compare:
If you sell a widget for $200 that arrives damaged and you failed to insure it (or worse: thought you were insured), the parcel carrier will cover $100 and you will have to pay out of pocket and still run the risk of a bad review. You would in essence pay for a pissed customer to tarnish your hard work and business reputation. What if this happens every 50 shipments? Would you be losing money at that point? You can be guaranteed you will lose customers, time dealing with those losses and any bad reviews that will be associated with it.
What is your customer worth to you? Do they have the same worth if they are happy or unhappy? The obvious answer for this is no. Bad news travels the fastest and if you are a business, that could be extremely detrimental to end up on reviews of pissed customers.
This can be the death toll for some businesses and insuring their shipments is one of many ways to have a happy customer.
Are all eCommerce plugins the same? At the core, pretty much:
Shopify App Store: ShippingEasy.com: Shipsurance
WooCommerce App Store: Shippo.com: Shipsurance
Volusion App Store: Stamps.com: Carrier Coverage
Magento App Store: ShipperHQ: Carrier Coverage
We hope we gave you information that will help you increase customer satisfaction and limit your exposure to losses and bad reviews. Have a story? Need help? Let us know: Contact Us