U.S. businesses are being squeezed when it comes to shipping costs.
Across the board, FedEx and UPS are raising their shipping rates by 6.9% in 2023. At the same time, the U.S. Postal Service is hiking shipping rates in 2023 by an average of as much as 7.8%. One of the factors driving these increases is inflation.
Meanwhile, online shoppers increasingly demand free shipping.
According to Shopify, which operates an ecommerce platform for businesses, 8.7% of a small business’ average first-year budget of $40,000 goes toward shipping. That works out to $3,480 for sending packages and other items.
So, what can a business do to ease the burden of shipping expenses? One option is to use business credit cards that feature breaks on shipping costs. Here are some offerings from American Express, Capital One and Chase that might decrease the financial weight of shipping.
Best credit cards for saving on shipping costs
American Express
If you’re an Amex merchant, you can enjoy exclusive FedEx savings through FedEx advantage; however, even if you aren’t an Amex merchant, you can still save on shipping with the right American Express business credit card.
The CardName discontinued, for example, earns 4x Membership Rewards points on the two eligible categories where your business spends the most (each billing cycle) from six eligible categories. While your top two categories may change, you will earn 4x points on the first $150,000 in combined purchases from these categories each calendar year (then 1x thereafter). Only the top two categories each billing cycle will count towards the $150,000 cap. Additionally, earn 3x Membership Rewards points on flights and prepaid hotels booked on amextravel.com using your Business Gold card. American Express is a CardRatings advertiser.
In addition, new cardholders can earn 100,000 Membership Rewards points once spending $15,000 on eligible purchases in the first three months of having the card.
The Business Gold Card charges a AnnualFees annual fee. See Rates and Fees
Another card to consider to help with shipping costs is CardName discontinued. The Business Platinum Card provides five points per dollar spent on flights and prepaid hotels booked through amextravel.com, and one point for each dollar you spend on other eligible purchases. Additionally, earn 1.5X points (that’s an extra half point per dollar) on each eligible purchase at US construction material, hardware suppliers, electronic goods retailers, and software & cloud system providers, and shipping providers, as well as on purchases of $5,000 or more, on up to $2 million per card account per calendar year. Purchases eligible for multiple additional point bonuses will only receive the highest eligible bonus.
Furthermore, you can earn 150,000 Membership Rewards points once spending $20,000 on eligible purchases with your card in the first three months of opening an account.
The Business Platinum Card charges a AnnualFees annual fee. See Rates and Fees
Finally, if you regularly stay in hotels for business travel, the CardName discontinued is another good option to consider as it can save you money on both hotel stays as well as shipping costs. Cardholders earn four points for purchases made at restaurants worldwide, at U.S. gas stations, on wireless telephone services purchased directly from U.S. service providers, and on U.S. purchases for shipping. Additionally, earn six points on eligible purchases at hotels participating in the Marriott Bonvoy program, and two points on all other eligible purchases.
Earn 3 Free Night Awards after you spend $6,000 in eligible purchases within the first six months of card membership. Each Free Night Award has a redemption level up to 50,000 Marriott Bonvoy® points, for a total potential value of up to 150,000 points, at hotels participating in Marriott Bonvoy®. Certain hotels have resort fees. Terms apply.
This card charges a AnnualFees annual fee. See Rates and Fees
Capital One
For businesses with less-than-great credit, the CardName might be an attractive option for saving money on shipping.
The Capital One Spark Cash Select is designed for business owners with good credit, and gives you an unlimited 1.5% cash back on every purchase (such as shipping), without limits or category restrictions. In addition, new cardholders can enjoy 0% intro APR for 12 months before the regular ongoing RegAPR APR applies, giving you extra time to pay off purchases interest-free, should you need it.
This card doesn’t charge an annual fee.
Chase
The CardName might be right for you if you do a lot of travel and shopping.
A holder of the CardName earns three points per dollar on the first $150,000 spent each account anniversary year in combined purchases on travel and select business categories, including shipping.
After reaching the $150,000 mark for combined purchases in one year, cardholders receive one point for each $1 spent in the same categories with no maximum point accumulation.
Points can be redeemed for items such as gift cards, travel, and pay-with-points products and services. At the time of this writing, points redeemed through Chase’s Pay Yourself Back program for shipping are worth 25% more.
Other perks of this card include 90,000 bonus points, worth as much as $1,125 when redeemed through Chase Travel℠, earned after spending $8,000 on purchases in the first three months after opening an account.
The Chase Ink Business Preferred card charges a AnnualFees annual fee.
If you’re looking for a no-annual-fee option, the CardName is another solid choice.
The card supplies unlimited 1.5% cash back on every business purchase, including shipping. Like the Preferred card, the Unlimited card offers a bonus value on shipping rewards redeemed through the Pay Yourself Back program, though just 10% instead of 25%.
There’s no annual fee. Plus, you can earn $750 bonus cash back after you spend $6,000 on purchases in the first three months after the account is opened.
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