The Entreprenette - 22 Week Tele-Course
How To launch your product based start up from your living room
Week 13
Shipping and Warehousing
This can be fun! Seriously, when you are sending your hard work out the
door there is a real sense of satisfaction in shipping. I loved it when I first
started……..now…….no thanks! There are several options out there and doing
it yourself may be your best bet when you get started. You should at least
understand how it all works and have packed a few boxes yourself if you
choose to outsource this from the start. There can be lots of storage issues at
home and I understand all that. But if you have a garage it works nicely. I
have had my living room stacked with boxes at Christmas time and let me tell
you – it is quit a rush to see all that “money” going out the door. I know
shipping from home is not an option for everyone so here are alternatives as
well.
a. Do it yourself – Whether shipping from home or from an office, you
are still going to need supplies and a shipping account with UPS, Fed-x
or USPS. You will need to do the research and choose the best
financial and convenient choice for yourself. I’ve always used UPS as
I felt they were very competitive. With any service above, you can
drop off or opt for daily pick up when you are busier. You will need to
find a local supplier for cartons. Try google if you can’t ask someone
or call your local chamber of commerce.
b. Fulfillment house - This is sometimes known as a 3rd party
warehouse. This is what I use now as my shipments from Asia are way
to large for my home and when I was pregnant with the twins I
couldn’t bend down to ship any longer! A fulfillment house stores
your merchandise for a monthly storage fee usually based on the
cubic feet you take up. So if you have only one item and it can be
stacked on a palette and go up then your cubic feet will be less than
someone like me who has multiple colors and multiple items and has
to stack low and wide. They usually charge to “pick and pack” by item.
So if you have a box that gets 3 items in it then they might charge you
to make the box and then to put each item in the box. You are also
going to want to teach the packers how to pack your stuff and which
boxes to use for how many items etc. You need to have figured this
out on your own. This is why I stress that it is a good idea to have
packed and shipped some on your own to work out these kinks before
hand. They only know what you tell them and you want your brand
to be represented as you desire at all times.
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The Entreprenette - 22 Week Tele-Course
How To launch your product based start up from your living room
When you talk to them you may want to ask the following
questions?
i. How much do you charge for storage? How do you calculate
that?
ii. How much do you charge to pack the boxes?
1. Do you charge a fee to make up the box?
2. Do you charge by the item?
3. Do you charge to put the shipping label on the box?
4. Do you charge to put the packing list on the box?
iii. Do I need to supply my own shipping cartons?
1. If yes, do you tell me when to reorder?
iv. Do you supply the tape and the packing list envelope?
v. Will you maintain a count of my inventory?
1. Do you supply an inventory report at all?
2. Would you do an inventory count for me if I need it?
vi. Do you use my shipping account?
vii. How do I get you the orders?
viii. What is the best way to communicate with you if there is a
problem with an order?
1. If you make a mistake in packing the box, how is that
handled?
a. If they send the wrong item – do they pay the
shipping cost to send the correct one and
retrieve the wrong one?
b. If they forgot an item do they ship it on their own
account?
ix. Does your insurance cover my merchandise for damage?
x. How much notice do you need when I am bring more stuff?
xi. I would like to train your staff to pack my boxes properly –
how do we arrange that?
c. Drop shipping – This is usually when a website displays your product
for sale, but does not buy and stock it in advance. They sell it like they
have it in stock, but in reality, they send you the order and have you
ship it. This can work out nicely if you up the charges a bit. What I am
saying is that instead of offering them the items at wholesale plus
shipping (which you set as you know the cost) you add on 25% as a
handling fee to cover your costs of shipping out one item at wholesale.
For example: Item wholesale is $10 x 2.5 = $25 retail. You would
require them to pay $12.50 wholesale ($10+25% of wholesale plus
shipping) as the “fee” for doing drop shipping. The website retailer
will usually email you an invoice to put in the box and then you will
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The Entreprenette * 8033 Sunset Blvd. #175 Los Angeles, CA 90046 * 213.705.6133
The Entreprenette - 22 Week Tele-Course
How To launch your product based start up from your living room
charge their credit card on file for the charges and ship the item
directly to the customer. If you use a fulfillment house this 25% extra
usually covers the fees involved so it doesn’t eat into your margins. If
you are shipping yourself then you just made extra money! Go out
and celebrate!
d. Buying supplies - This can seem like an annoying expenditure.
Cartons are a waste of money and if you can find a recycled resource
then I say go for it as they are way cheaper. When deciding on the box
size you want to measure carefully as they are sold by size and
therefore the price varies a lot. Depending on what you are making,
you may need a box for a set of 6 and a set of 12 then a master carton
to put those in. Ultimately, you will need to research box supply
companies in your area to see who has the best prices. Box supply
companies usually have the clear packing tape and packing list
envelopes as well.
i. Special Delivery – If you need special stickers like Fragile or
This side UP then see http://www.papermart.com. They have
a good selection at a fair price and ship all over the country.
ii. Master cartons – A master carton is a large box that has
smaller boxes inside. For example, if you sell hand sanitizer
you may have boxes of 6 pre-packaged as that is your
minimum. If a store wants more than 6 then you would put the
24 or 48 pc in a master carton. You may get big orders where
you have lots of master cartons. Some mass market stores
(Also known as Big box stores) will often ask how many master
cartons you can put on each pallet etc…. you will need to know
the answers to be able to comply with their shipping
regulations. Once you figure this out you can reuse the
numbers so don’t get overwhelmed yet.
e. Shipping to Department stores or Mass retailers: UGH – as
fabulous as this is, and yippee for you when it happens - the shipping
guide that they email over is not light reading and can lead to a BIG
headache. Even if you are using a fulfillment house I would be aware
of the shipping regulations and go over it with them in detail. You get
charged for every mistake you make that they have to fix on their end.
These are called chargebacks and they can get costly. You don’t want
to make mistakes. There is usually a contact person for the guide who
can answer questions and I suggest making friends with them. They
can often simplify a confusing step and save you time and money.
Every store is different, some have you ship UPS collect (meaning they
pay), some use a pick up service and others make you pay. Be sure to
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The Entreprenette * 8033 Sunset Blvd. #175 Los Angeles, CA 90046 * 213.705.6133
The Entreprenette - 22 Week Tele-Course
How To launch your product based start up from your living room
know what it is before hand in case you can’t afford to give them the
huge discount they may require and pay for shipping too. Ask – the
buyers are used to it.
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The Entreprenette * 8033 Sunset Blvd. #175 Los Angeles, CA 90046 * 213.705.6133