If you sell a physical product on Digistore24, you can add shipping costs to the product price according to the country of destination instead of including them in the product price.
This has the following benefits:
- Increased transparency as your customers can see all components of the product price
- Country-specific shipping costs (a specific shipping cost policy is possible for each country of destination)
- The shipping costs are fully credited to the vendor (your affiliates or joint venture partners will not have any claims)
- Reduced risk and increased planning reliability lead to more profit
How is the shipping cost policy displayed?
When a customer clicks on your order form with an address in a country for which you have created a shipping cost policy, the shipping costs are displayed in addition to the product price and VAT.
For tax purposes, shipping costs must be treated in the same way as the shipped product.
In Germany, VAT is 19%.
However, there are exceptions:
For example, books, magazines, audio books (on physical media only) and food supplements are taxed at a rate of 7%. For mixed orders, shipping costs are proportionately taxed at the respective tax rates.
You can find more information about VAT in this article.
You sell a physical product and have specified in your payment plan that your product costs 10 € and is displayed as the net price. Your customer accesses your order form and enters a German address. You have specified in your shipping cost policy for German customers that 5 € for shipping costs will be charged.
The customer will now see the following on the order form:
Price (EUR): 10 €
10 € product price (net)
Postage and packaging1: 5 €
5 € shipping costs (net)
VAT (19%): 2.85 €
German VAT is 19%. The VAT of the product price and the shipping costs are added together.
Total: 17,85 €
Product price + shipping costs + German VAT
Create shipping cost policy
If you sell your products across the globe, it makes sense to create a separate shipping cost policy for each country of destination.
You can add any number of countries to a shipping cost policy. For example, if the shipping costs of three countries are the same, it is most practical to create just one policy for the three countries.
If no shipping cost policy applies to a country, the order cannot be processed.
In the vendor view, go to Settings > Shipping costs [Backoffice] and click on the button “Create shipping cost policy”.
Enter a name. This name is only visible to you.
Recommendation: If you sell a product in several countries and therefore will be creating several policies, it makes sense to choose a name which you can use to clearly distinguish your policies e.g. “[product name]-[country/countries]”.
If you want to activate/use the shipping cost policy directly after you’ve saved it, click “Yes” for “Active”.
For “Order” you can specify where the policy should be listed if you have created more than one.
In the field “For products”, select the product(s) for which you would like to create the shipping cost policy.
In the field “For countries”, select the countries for which this shipping cost policy should apply.All countries are selected by default. If you click on the check mark next to “All” at the top, all check marks are removed and the countries are deselected. Please note that Germany can only be found at the top of the country list. Please also note that if you have selected “EU (excluding Germany) or “Outside of EU” at the top, then the respective countries that match your selection are not selected for you.
Please ensure that no other countries are unintentionally selected before proceeding to the next step.
In the field “For currencies”, select the currencies which shall apply for this policy.
For “Calculation made”, you can set whether the shipping costs are to be incurred once or on a monthly basis.If you sell your product as a subscription or an installment, you should choose the monthly calculation, regardless of the payment interval you choose. The shipping costs are then converted to the respective payment interval.
An example: Your customer receives and pays for your subscription product once per year. Since the shipping costs are charged monthly, the customer pays 1/12th of the actual shipping costs per month.
Attention: Do not enter the total shipping costs, but only what the customer should pay per month i.e. the total shipping costs divided by the number of months between the billing intervals of the subscription:
* For a yearly billing interval: 1/12th of the total shipping costs
* For a six-monthly billing interval: 1/6th of the total shipping costs
* For a monthly billing interval: the total shipping costs
* For a weekly billing interval: 4 times the total shipping costs
If your customer can buy your product several times, then for “The costs apply” determine whether the shipping costs should be charged separately for each product (i.e. shipping costs x quantity) or whether the shipping costs apply for the entire order, irrespective of the number of units.
If your customer can buy your product several times, then you can specify in “Discount levels” that they will receive a discount for a certain number of units ordered. You can determine this discount under the next item “Shipping costs”.
Now specify that the shipping costs should apply to the countries selected in step 6. If you activated discount levels in step 10, you can determine the percentage discount starting from a certain number of units here.
In the “Texts” window you can change the default description “Postage and packaging” or “Shipping and handling” either for the German or the English order form.
An example of a shipping cost policy:
The vendor Max Mustermann sells a physical product.
Max now wants to set the following:
- The product can only be shipped to the EU (incl. Germany).
- Shipping to Germany is free of charge.
- Shipping to other EU countries is charged with six Euro.
Max creates two shipping cost policies:
- He creates the first shipping costs policy for Germany by ticking "Germany" at "For countries". He specifies 0.00 Euro at "Shipping costs".
- He creates the second shipping costs policy for all EU countries (excluding Germany) by ticking "EU (excluding Germany)" at "For countries". He specifies 6.00 Euro at "shipping costs".
Since Max does not want his product to be shipped to countries outside the EU, he does not create a shipping cost policy for those countries. If a customer wants to order a product outside the EU, he will be informed that shipping is not possible.
Disallow shipping to specific countries
If you do not want every customer - regardless of their country - to be able to order your product, you can exclude individual countries from the shipping cost regulation.
It is sufficient if you do not create a shipping cost policy for the country of your choice.
A customer from Iceland wants to order your product.
Since Iceland is not subject to any shipping policies, the customer is notified that shipping to Iceland is not possible and the order cannot be processed.
What happens if a customer makes a package change?
By “package change” we mean an increase or reduction in the quantity of products ordered within a subscription.
If a package change takes place, the old subscription is normally (= without shipping cost policy) interrupted and the cycle is restarted on the day of the package change.
However, if the package change is carried out for a product that is subject to the shipping cost policy, the old subscription cycle is retained.
A customer called John Smith has a monthly subscription for your product and orders 10 units every month. The debit is always carried out on the first day of the month.
On February 15th, John Smith makes a package change and increases the number of units per month to 15.
With shipping cost policy: The increased debit takes place as normal on March 1st.
Without shipping cost policy: The increased debit takes place on February 15th and from now on the monthly debit will take place every 15th day of the month (i.e. March 15th, April 15th).