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I have a question for those with an online shop

by WasifN
12 replies
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Hey guys, I was just wondering how much do you guys pay to ship your goods to your customers? Size of parcels? And on average how many orders do you ship per month?
also, any recommended couriers with services in the UK? Do you offer international or national services?
#online #question #shop
  • Profile picture of the author aronprins
    Hey WasifN,

    I think it really depends on what you want to sell... If you sell flatscreen TV's it obviously is a completely diffrent thing then keychains.

    I'd run a google search for DHL, Royal Mail (assuming you're in the UK) etc and compare them all.

    Hope this helps.
    Cheers,
    Aron
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  • Profile picture of the author Auctiondebteliminator
    In the UK, Royal mail is the way to go. To my understanding (which might be incorrect, I admit) is that they have flat rates no matter where they're shipped.

    But, for heavier items it's desirable to find a local freight company. (Not a big name, but one that is privately owned.)

    -Auction Debt Eliminator-
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  • Profile picture of the author JosephI
    Free shipping is always a good sell.
    You just need to built it in to your costs regardless of the item.
    Use whatever formula works for you.
    Cheers
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  • Profile picture of the author AadhyaMehra
    Banned
    Well, as we know that free shipping is better than drop shipping. And according to your queries, it completely depends what kind of shipping services are you are considering. Because, the logistic rates of every company are different (according to KGs). For best courier service, you need to consult with them according to rates and services.
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  • Profile picture of the author WasifN
    Thanks for the feedback guys much appreciated. The items I will be shipping are very small (<100g) and most couriers I looked at had basic rates per parcel so it wasn't really worth it for me since the items are small and cheap.
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  • Profile picture of the author Auctiondebteliminator
    I want to clear up some misconceptions.

    Look, it's true that Free Shipping should, and must be done.

    However - the WORST thing you can do is charge shipping ON TOP OF the market worth of the item.

    So, let's just say the market has chosen the price of 60 dollars for an item. (Because the seller can never choose the price) If you were to charge even a dollar over that price - you'd never sell it.

    Why? Because people only value it at 60 dollars. Not 61.

    In a nutshell: Shipping isn't ADDED into the cost of the item - the cost of the item COVERS shipping.

    Otherwise, you'll wonder why nothing you have is selling.
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    • Profile picture of the author CreativeWest
      Originally Posted by Auctiondebteliminator View Post

      Look, it's true that Free Shipping should, and must be done.
      That is just delusional. Zalando provide free shipping and have an 80% returns rate, what you will have is the irrational customers buying your products, not liking them and sending them back on a whim destroying your gross profit margins. All the key sites have a low fixed rate unless they are bulk items, Amazon is variable as they work on 30% gross profit margins and sell trinkets so every cent counts but they have volume and web capital so nobody cares. You can use free shipping as a marketing loss lead to gain customers, but if your CLV is butt ugly then you will never make it back and you'll be working for free or paying your customers to buy from you. If you want to feed the irrational buyers with an irrational business plan, oddly sometimes that can work, but you'll need to to have a screw loose somewhere to match.

      International and small and cheap, never a good combination, Hermes is about the cheapest, look into click & collect, as you don't have the volume your per shipping cost is probably going to be more than the item, customers don't like that and there's no simple solution. You'll need to add higher priced items and try and average it out, the high priced items loss lead the trinkets.
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      • Profile picture of the author WasifN
        Originally Posted by CreativeWest View Post

        That is just delusional. Zalando provide free shipping and have an 80% returns rate, what you will have is the irrational customers buying your products, not liking them and sending them back on a whim destroying your gross profit margins. All the key sites have a low fixed rate unless they are bulk items, Amazon is variable as they work on 30% gross profit margins and sell trinkets so every cent counts but they have volume and web capital so nobody cares. You can use free shipping as a marketing loss lead to gain customers, but if your CLV is butt ugly then you will never make it back and you'll be working for free or paying your customers to buy from you. If you want to feed the irrational buyers with an irrational business plan, oddly sometimes that can work, but you'll need to to have a screw loose somewhere to match.

        International and small and cheap, never a good combination, Hermes is about the cheapest, look into click & collect, as you don't have the volume your per shipping cost is probably going to be more than the item, customers don't like that and there's no simple solution. You'll need to add higher priced items and try and average it out, the high priced items loss lead the trinkets.
        Thanks for the feedback it is much appreciated I need to re-think my business model because its obviously not feasable atm.
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      • Profile picture of the author Auctiondebteliminator
        Originally Posted by CreativeWest View Post

        That is just delusional. Zalando provide free shipping and have an 80% returns rate, what you will have is the irrational customers buying your products, not liking them and sending them back on a whim destroying your gross profit margins. All the key sites have a low fixed rate unless they are bulk items, Amazon is variable as they work on 30% gross profit margins and sell trinkets so every cent counts but they have volume and web capital so nobody cares. You can use free shipping as a marketing loss lead to gain customers, but if your CLV is butt ugly then you will never make it back and you'll be working for free or paying your customers to buy from you. If you want to feed the irrational buyers with an irrational business plan, oddly sometimes that can work, but you'll need to to have a screw loose somewhere to match.

        International and small and cheap, never a good combination, Hermes is about the cheapest, look into click & collect, as you don't have the volume your per shipping cost is probably going to be more than the item, customers don't like that and there's no simple solution. You'll need to add higher priced items and try and average it out, the high priced items loss lead the trinkets.
        This makes absolutely no sense. What I stated can be outlined by elementary economic principles, peer-reviewed case studies, and math.

        First, the supply and demand curve. This shows us how much markets are assigning prices to certain items.

        On the graph, you're target is to match the supply curve with the demand curve, thus maximizing your volume to margin. Once you've found this, it doesn't mean people will buy from you. You'll need to maximize the chances of that.

        First off, free shipping is an amazing psychological tool. Just by offering it, you can increase your turnover. Now, for some reason people believe that offering free shipping means people won't buy from them.

        Here's where some math comes into play: if the MARKET is assigning 100 dollars to the item, then it doesn't matter if you charge 10 dollars, plus 90 dollars shipping, 50 and 50, 90 and 10, or ONE HUNDRED AND FREE. It's the EXACT same price. However, the other don't have the psychological advantage.

        Now. Bad sellers will have increases in returns, and great sellers have almost no returns.

        Why? Because good sellers know how to SELL THEMSELVES to the public. If you sell, appropriately, your product PLUS your incredible customer service policies, you'll, again, increase your turnover.

        However, even if you DID have a return, you wouldn't loose money. Why? Because the increase in turnover will more than make up for that one measly loss. Also, if you were to make that customer incredibly happy with you, then you can have them for a life-long customer, thus making money on that customer eventually.

        Selling items 'as is' or 'no returns accepted' makes people nervous. It's like buying a TV with no warranty. What is the seller afraid of? Selling a TV even they don't believe in?

        Probably.

        Oh, and here's the case study:


        Forget blame game: Free returns can increase online purchases 357% - Business
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        • Profile picture of the author CreativeWest
          Originally Posted by Auctiondebteliminator View Post

          However, the other don't have the psychological advantage.
          Correct, they are not nuts, they value time, and they look at GP/NP and CLV. And before you write another dissertation, Zalando along with most of the other free shipping retailers don't book returns in their revenue so is all just a big game of hide the numbers with negative lifetime EBIT, not including the extra resource to process returns. Very nice for a venture funded corporate, not so pleasant for a rational small business retailer with limited cash flow. And so the great delusion carries on ad-infinitum but as previously said, irrational sellers and irrational buyers make a happy couple.
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  • Profile picture of the author Lipipaliwal
    Banned
    Originally Posted by WasifN View Post

    Hey guys, I was just wondering how much do you guys pay to ship your goods to your customers? Size of parcels? And on average how many orders do you ship per month?
    also, any recommended couriers with services in the UK? Do you offer international or national services?
    Well, drop shipping is the best method for shipping the product from one place to another. There are so many companies providing a drop shipping facility for their clients nowadays. And, yes, if you want the information about the goods and parcel charges, then it is completely depends on the shipping services, what you prefer for your goods. The charges of different companies are different. So, for the better information, you need to take a look over different shipping companies and their services.
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  • Profile picture of the author LABEShops
    I ship just about everything USPS. They pick up from me every day and provide free boxes so it's easy peasy.
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    Owner of LABEShops.com & 20+ Niche Online Stores as well as Scifispace.com and other sites. Recommended Host: Evolve

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