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Well, hello, and welcome to this week's edition of the eCommercer.
I want to talk about a line on your invoice that almost nobody actually reads. It's the shipping line. We tend to glance at it, decide it's roughly what we expected, and move on to the things that feel more interesting. But there's a fair chance you're paying for air, quite literally, and have been for years without ever knowing it.
That's what this week's conversation pulled into focus for me, and I've been thinking about it ever since.
The two-pound parcel that ships like it weighs eighteen
My guest is Leo Rodriguez, Vice President of River Plate, Inc., a Los Angeles 3PL that handles fulfilment and logistics for direct-to-consumer, wholesale and Amazon brands. Leo has spent years watching the back end of ecommerce, the bit none of us see, and he's watched an awful lot of brands quietly overpay.
The thing he explained that genuinely made me sit up is something called dimensional weight, or dim weight. Carriers don't just charge you for how heavy your parcel is. They charge you for how much space it takes up on the van. So if you put a two-pound product into a 12x12x12 box with a load of void fill around it, the carrier runs a calculation and rates that parcel as though it weighs around eighteen pounds. You're not paying for your product. You're paying for the empty space you wrapped around it.
| | It's getting rated at an 18-pound shipment. You just went into a different tier of shipping where you could have saved $2 to $3 per package.
Leo Rodriguez |
The fix has a slightly unglamorous name, which is cartonization. It's software, increasingly AI-driven, that reads the actual dimensions and weight of what you're shipping and picks the smallest sensible box, then rate-shops across a network of carriers (DHL, USPS, FedEx, UPS, the regional ones) to find the cheapest lane for that exact parcel. Combine the two and a brand doing a few hundred orders a day saves two or three dollars on every single one.
Why two dollars is the whole game
Here's the bit that stuck with me. Leo said something I think a lot of us get backwards, which is that on a per-order basis the shipping cost can actually be higher than the fulfilment fee. We obsess over the fulfilment line, negotiate it hard, and then wave the shipping line through.
But two dollars a parcel across three hundred orders a day is six hundred dollars a day. That's not a rounding error. That's a margin protector, as Leo put it, and it's sitting there in plain sight on every order you've ever shipped.
He also walked through the messier end of all this, which is international. If you sell skincare or cosmetics, some countries (Italy, Spain, even Mexico) are strict about what's in the bottle and what's printed on the box. You can have fifty shipments sail through, then one customs agent decides to nitpick, and your product gets stuck or disposed of. And here's the sting, because the customer never gets their order, the brand gets the bad review. Not the carrier. Not the customs office. You.
And he was honest that smaller brands have had the worst of the recent tariff upheaval. The big brands had the buying power to get their overseas manufacturers to absorb the freight costs, sometimes thousands of dollars a container. The smaller brands just got stuck with inventory they'd already produced and couldn't afford to bring in.
Why this lands for me
I run ecommerce businesses, one that sells purely in the UK and one that ships all over the world, and I can tell you the worldwide one is a different animal entirely. We went through Brexit over here, which was our own version of this chaos, and years later there are still days where one European country or another decides to send a batch of our parcels back for no reason we can ever fully work out. So when Leo talked about international shipping not really being as free as we'd like to believe, I knew exactly what he meant.
But the dim weight point is the one I'm taking away. I've genuinely never sat down and checked whether the boxes we use are the right size for what's going in them. I just assumed someone, somewhere, had sorted it. After this conversation I'm not so sure, and I suspect I'm not the only founder who's never looked.
It's a properly useful one if you ship physical product. We also get into the customs gray zones, fuel surcharges becoming the new normal, and whether building your whole business on Amazon is as wise as it looks.
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