How to Reduce Delivery Costs for an Ecommerce Business

If you sell online in Nigeria, you know the pattern. A customer orders, you book a rider or a waybill, the price is higher than you expected, and the margin on that order shrinks. Multiply that across hundreds of orders and delivery can quietly decide whether your business is profitable.

Here are the levers that make the biggest difference, roughly in order of impact.

1. Store your stock closer to your customers

Distance is the single biggest driver of delivery cost. A parcel that travels across town costs far less than one that travels across the country, and it arrives faster.

If you keep all your stock in one city but a large share of your customers are elsewhere, every one of those orders is an expensive interstate delivery. Placing some stock in a second city turns those into local deliveries.

Start by checking your last few months of orders. If a meaningful share goes to one other city, that is your second storage location. Movnn’s inventory distribution places stock in hubs across Lagos, Abuja, Port Harcourt, Kano, Jos, Calabar, Minna, Makurdi and Lokoja, and moves it between hubs for you.

2. Cut failed deliveries

Every failed delivery is paid for twice. The most common causes are unreachable customers, wrong addresses and buyers who changed their mind because the order took too long. To reduce them:

• Confirm phone number and address before dispatch, especially for social media orders.
• Deliver faster. The shorter the wait, the less time a customer has to cancel.
• Tell the customer when the order is on its way.
• Track your failed-delivery rate by area and channel so you can spot patterns.

3. Stop sending every order individually

Sending parcels one by one from your shop means paying for a separate trip each time. Fulfilment hubs batch deliveries, so riders cover several drops per route. That is a big part of why delivering from a hub costs less than booking a dispatch rider per order.

4. Move stock in bulk, not order by order

If your supplier is in one state and your customers are in another, moving stock in bulk to a hub near your buyers is much cheaper than shipping each order across states. First-mile pickup and interstate transfers are part of Movnn logistics.

5. Right-size your packaging

Oversized boxes take more space in a vehicle and can push a parcel into a higher price band. Use the smallest packaging that protects the product, and avoid shipping air.

6. Price delivery deliberately

Decide whether you’ll charge delivery at cost, offer free delivery above a minimum order value, or build it into the product price. A minimum order value for free delivery encourages bigger baskets, which spreads one delivery cost across more items.

7. Stop haggling and start measuring

Negotiating with a new rider for every order costs time and gives you no data. Working with one logistics partner gives you consistent pricing and a record of every delivery, so you can see your true cost per order and where it’s going up.

Putting it together: an example

Here is an illustrative example. Imagine a Lagos fashion brand where 40% of orders go to Abuja. Every Abuja order is a separate interstate shipment that takes days, and some customers cancel while they wait. By placing a portion of best-selling stock in an Abuja hub, those orders become same-day local deliveries: cheaper per parcel, faster for the customer and fewer cancellations. The brand moves stock to Abuja in bulk once in a while instead of shipping each order across the country.