How do you classify your shipping? Is it an expense or COGS?
In-bound shipping, the cost to acquire the items or material you use to make items, is part of the cost of the items. But what about out-bound shipping?
When you charge your customer for shipping, that is an income to the business. When you pay to actually ship the items to the customer, that is an expense. The shipping income and the shipping expense then offset each other in the P&L.
But there can be exceptions for out-bound shipping.
For example, you sell your items to a store and as part of the sales price you agree to pay shipping. If the sale is final, not on consignment, then I would include the shipping cost in COGS for that sale.
But if you could be asked to pull your items off the store's shelves at your cost then the cost to ship them to the store cannot be considered COGS, because the sale was not final.
As always, ask your accountant regarding your specific situation.