Saving on shipping costs of small items to US customers

4 replies
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Hello warriors, I have a relatively new US-based online business. I buy my items from Alibaba (around 400 at a time, largely from China) and then sell them individually via my e-commerce site. I offer free shipping in the US, and plan to keep it that way. The item I sell is fairly small (fits in a 10x5 bubble wrap envelope) and weighs less than a DVD

However, my profit margin is only around $2.50 per item after I account for the shipping costs. I managed to reduce my packaging costs drastically by buying bubble wraps in bulk from ebay rather than from the post office.

However, shipping cost using the cheapest option at USPS is still around $2.70 per package (1 item). is there any way to save on this? I keep hearing about, but never used them.

I assumed that USPS is cheaper than UPS or Fedex for small bubble wrap enclosed packages so did not try to check those two.
#costs #customers #items #saving #shipping #small
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  • I'd also like to add that your margins are small anyway.

    If you're making even 5 dollars per item, and it takes you 10 minutes on the front end, and 10 minutes on the back end to process, you're making a whopping 15 dollars an hour.

    A common misconception people have is that you need to sell 'small, easily shipped items' to make money online.

    However, this cannot be true.

    Truth is: it doesn't, and it will NEVER matter what the shipping cost is.

    You're only looking at one metric - and that is shipping. The MOST important number is: "How much will I make on this sale?"

    Let's take this scenario: You have an item, and it costs 600 dollars to ship. Most people would shy away from this because 'shipping is too high.'

    One question they aren't asking themselves is: "How much WILL people buy this for?"

    If you costs justify the margin, it means that the market worth is appropriate. This number, the market worth number, is the one that most people miss and don't know how to find.

    It's what I've been teaching for years as it is VERY, very important. All other numbers are derived from this single-most important number.

    Famous for my '$1000 dollar challenge,' I've been teaching people how to DOMINATE on eBay for YEARS. Sell 100% of your items FOR A PROFIT. Rank higher, sell faster, sell more, and DESTROY your competition with a data-based approach. Quit listening to Guru's-in-training! Click now below!
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  • Profile picture of the author itunesguy
    Thanks for the great advice ADE. I know that my per hour income at present is small with this new business...however, my goal is to sell higher-end similar products once I have some revenue coming in and more traffic coming in. Also, some people do order 2 items in one go, and I hope that with enough time, I will get orders of 3 or more items per customer. I can ship 3-4 items in one 5x10 package as the items are fairly compact.

    Of course in the longer run I would love to sell only items that cost $1000 and where I can earn say $200 per item. But can't risk it at the moment.

    I also own another non e-commerce site that sends some traffic over to the current related product/site, so have an advantage with getting traffic for this current business even if its a low value product one.
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    • Profile picture of the author TheMoneyTree
      I've used and they do provide a discounted rate than if you walked in the post office. They do have a 15.99 monthly fee though, but if you are selling volume, its easily justified by not having to stand in line. With your products, it sounds like you can just drop them in a mailbox drop box and be on your way, and you wont even have to walk in to a post office.

      I ship thousands of items a year and have come to the conclusion that the cheapest shipping supplies are on ebay for 95% of the items we use. Kraft padded mailers, cardboard boxes up to 8x8x8 and poly mailers are much cheaper than anywhere else we have looked. I even have a shipping supply company about 20 minutes from us and they can't match ebay prices. Check there and you should be able to lower you overhead on shipping supplies.

      ADE is right on about how much is it actually costing you. I've been down that same road you are on, starting small making a few bucks here and there just to gain momentum. One thing you should seriously stop and review is the process in which you go from order placed to that item in a mailbox out of your hands. Do a time study on how long it actually takes to complete a phantom order. Then figure out how you can trim that time down and increase efficiency. It could be something as simple as putting shipping supplies in a different order or location. Your time invested in this will pay you back ten fold and then some as you grow and move more product. It's something that seems to be always overlooked.
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