How to deal with unknown or variable freight costs in your eCommerce software

Firstly, it is important to keep the customer informed and the process transparent. Secondly, this is the 21st century so your process should not involve customers ringing you for freight, the software should provide an easy confirmation/approval process when quoting the customer for freight. Your Payment Gateway should support a 2 step process, for example PayPal supports:

1. Authorization -> The customer's money is reserved
2. Delayed Capture -> The customer's money is actually transferred to your account

Due to a variable freight cost, which is dependent on where the shipping address is and the size of the order, the Authorization amount will be different to the Delayed Capture amount. Therefore between those 2 steps your software should allow you to quote the customer for freight and get their approval.

DBiz does it in the following manner:

1. Customer shops on the eCommerce site placing items in their shopping cart
2. Customer checks out creating a pending invoice (it is pending as the amount will change due to the freight cost)
3. Customer makes a Payment (authorization only) via PayPal for the amount of the initial invoice. PayPal verifies the credit card details, reserves the money and returns a reference number. please note that the payment screen displays a check box "I want to approve delivery cost before payment is processed"
4. A DBiz message (DBiz has an internal messaging system) is sent to the Dispatch officer (the Dispatch Officer specified in the company settings) alerting them of a new order.
5. The Dispatch officer calculates freight adding this as a new invoice item (repeating this for all necessary invoices)
6. The Dispatch officer clicks "Process"
7. At this point 2 different workflows can happen depending on whether the customer requires approval (check box on payment screen)

Customer Requires Approval Process

1. An automated email is sent to the customer requesting Approval for the extra charge and new invoice total
2. The customer views the charge via the eCommerce system and approves by clicking the Approve button
3. The new amount is submitted to PayPal for Delayed Capture, upon success the money is transferred
4. A message is sent to the Dispatch officer confirming payment

Customer Does Not Require Approval

1. The new amount is submitted to PayPal for Delayed Capture, upon success the money is transferred
2. An automated email is sent to the customer confirming payment