{"id":146970,"date":"2025-07-24T09:00:12","date_gmt":"2025-07-24T13:00:12","guid":{"rendered":"https:\/\/www.rithum.com\/?p=146970"},"modified":"2025-07-24T10:21:32","modified_gmt":"2025-07-24T14:21:32","slug":"retailers-are-losing-margin-at-the-doorstep-heres-how-to-stop-it","status":"publish","type":"post","link":"https:\/\/old.rithum.com\/au\/blog\/retailers-are-losing-margin-at-the-doorstep-heres-how-to-stop-it\/","title":{"rendered":"Retailers Are Losing Margin at the Doorstep\u2014Here’s How to Stop It"},"content":{"rendered":"

When shoppers click \u201cbuy,\u201d the real cost clock starts ticking. Shipping rates have jumped and carriers rolled out <\/span>new surcharges<\/span><\/a> for 2025. At the same time, the U.S. is preparing to impose a <\/span>30% tariff on European imports<\/span><\/a> starting August 1, and <\/span>the <\/span>de minimis exemption will be eliminated<\/span><\/a> by July 2027<\/span>. These changes will increase the total cost of getting goods into the country and eliminate duty-free status for small packages. Layer in <\/span>record-breaking return volumes<\/span><\/a> and a surge in <\/span>return fraud<\/span><\/a>, and your profitability starts to vanish before the order even arrives on your customer\u2019s doorstep. <\/span>\u00a0<\/span><\/p>\n

Here\u2019s what\u2019s driving these costs\u2014and why it matters now.<\/span>\u00a0<\/span><\/p>\n

The biggest profit drains start early in the fulfillment process. When retailers display inaccurate delivery dates at checkout and fail to keep customers informed about the status of their orders during fulfillment and delivery, it results in an influx of customer service calls.<\/span>\u00a0<\/span><\/p><\/blockquote>\n

I hear these concerns regularly in conversations with retailers. Another problem is when retailers fail to choose the most cost-effective shipping option that still meets the delivery promise. These issues can lead to increased costs and potentially lower customer satisfaction, ultimately impacting future sales and margins.<\/span>\u00a0<\/span><\/p>\n

Delivery costs keep climbing<\/span><\/b>\u00a0<\/span><\/h2>\n

Carrier rate increases aren\u2019t slowing. <\/span>UPS<\/span><\/a>, <\/span>DHL<\/span><\/a>, and <\/span>FedEx<\/span><\/a> announced <\/span>5.9% base rate hikes<\/span><\/a> for 2025, while USPS and DHL added seasonal and handling surcharges.\u00a0<\/span>\u00a0<\/span><\/p>\n

While costs rise, consumers still expect timely delivery. Consumers want convenience, and delivery speed matters. The <\/span>Rithum 2025 Global Returns & Profit Impact Report<\/span><\/i><\/a> found that 54% of consumers consider shipping time as a key reason they buy from a specific retailer or brand. <\/span>\u00a0<\/span><\/p>\n

Retailers are focusing on providing faster delivery for their customers, but this must be balanced with the higher shipping costs that come with expedited services.<\/span>\u00a0<\/span><\/p>\n

Tariffs and supply chain disruptions reshape cross-border costs<\/span><\/b>\u00a0<\/span><\/h2>\n

Delivery expenses are increasing as new tariff rules add pressure. For retailers, cross-border ecommerce is becoming more expensive and complicated, requiring sourcing strategies that adapt quickly to protect margins.<\/span>\u00a0<\/span><\/p>\n

The retailers I work with are deeply concerned about the upcoming tariff and trade deadlines. They are genuinely worried about the potential for increased costs and disruptions in the supply chain.<\/span>\u00a0<\/span><\/p>\n

These uncertainties make it challenging for retailers to plan inventory levels and make pricing decisions for the rest of the year and the holiday peak selling season. Some of the latest developments include:<\/span>\u00a0<\/span><\/p>\n