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Keeping Shipping Prices Low FEDEX VS USPS VS UPS

mentaltoast
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Are you a 'small' seller? Do you automatically use USPS? You may want to think twice for larger items. Likewise, Do you automatically use UPS or FEDEX? You may want to think twice for smaller items.

This guide is intended for the small ebay seller who may be selling different types of items, collectibles of different sizes, etc, who may not need or qualify for business 'account' services for larger volume.

While we qualify for account status, we have found we prefer the old fashioned way...read more..

We have been full time sellers on another ID for over 8 years. We have been Silver Powersellers for 3+ years now. We tend to specialize in a wide variety of goods with many being things other people do not want to sell due to size and packaging. We are not a one size fits all boxes seller. We sell higher priced, larger items that require detailed packaging rather than high volume, slide it into a tyvek or flat rate box merchandise. This guide is to show you other options.

Yes, packaging supplies and proper packing takes time and knowledge. But with the right research and initial planning, you can save your customers money, which can give you an ebay edge, while not taking a loss on shipping/time and hurting your bottom line.. 

When we have an item to sell and do ebay research, we are always surprised at the people who give a price of $12 to ship, yet we know this item is 30++LB and will take an hour to properly pack...an hour of  time that needs to get paid for...as in any business. There is no doubt they are going to lose big. Or, the seller who only uses USPS and is charging $65 when we know we can use Fedex and charge $30.

Example As A Buyer

As a buyer; I recently bought two Nintendo DS Lites from two different sellers. Both charged $10 and both said USPS. One arrived within 2 days and my son was able to play all vacation week. The second; the seller went to UPS and it took 10 days....leaving my other son in the dust. When I told the seller one of the reason I bought his item was the shipping method, he said he even took a loss and spent $15 on shipping and he was right. UPS charged $15 and took 10 days to arrive. USPS charged $8.95 for a flat rate box and took two days. As a buyer; which one would you prefer?  Both could have even charged less since the weight of the item was so light, normal priority without the use of a flat rate box would have been even less.

How To Figure Costs

The keys to remember are size x weight x distance. We are located on the far west coast. This means shipping across country is a lot more expensive from us than say from Kansas. Where are you located and where are you shipping?  This will be key to properly pricing shipping. USPS, UPS and FEDEX all have easy to use websites to figure costs.

Make sure you are using a good scale with all packaging and item in the box. It won't take long before you will be able to (guestimate) a close amount and not have to pile everything in and out of the box to make a quote. We usually just weigh the item and add 2-5 lb depending on the size of the item. Boxes can weigh 1-2 lb by themselves and the leeway gives us the extra funds to pay for quality packaging supplies and packing time...and we still come out under USPS or UPS.

We have compared rates many times with UPS, USPS and FEDEX based on distance, box size and weight and frequently found FEDEX being the cheapest for just about anything over 4lb. What would cost us $30 to ship by USPS frequently costs us about $15-$20 by FEDEX. 90% of our packages now go out by Fedex yet our shipping prices constantly remain in the low / average price zone on ebay. 

Just in the first 3 months of switching to Fedex over USPS; we were able to cut our overall prices almost in half, give our customers free insurance and tracking AND get paid for our time and supplies to properly pack. We were barely breaking even before the switch due to having to compete in the ebay market. If everyone is charging $12 to ship a widget, a seller cannot really go much over that if he intends to sell his item... no matter what his costs are.

Example Taken from Research Today:

Fedex from my zip to across country. 25lb, 12x12x12" box. $99 value, $99 free insurance & tracking, ground = $24.17

UPS same info= $32.15

USPS same info = $27.11 parcel or $38.15 Priority with no tracking and no insurance which is another $3.00++.

The total cost to package an item depends on how fragile it is and what one pays for supplies. But when we see people charging $30 for shipping based USPS and we are able to have a $20 actual base shipping charge; we can safely charge for proper, clean, new packaging supplies and time and still charge less than other sellers. We use a local box store and never have to have stacks of messy boxes taking up half our garage or bedroom. We simply buy what we need, when we need it. We frequently can buy boxes in the $1-$2.50 range. We do buy large rolls of bubble and peanuts, but that is it for bulk...AND WE STILL COME OUT AHEAD OF USPS and UPS! Just because boxes are free, does not mean it is the better option.

If your item weighs over 4lb, but fits into a flat rate box and is going across country, most likely your no brainer choice is USPS. If your item is over 4lb but only going to the next city, USPS may still be the better option, but not by Flat Rate Box. But if your item is over 4lb, will not fit in a flat rate box and needs a lot of packaging, Fedex has always been a much better choice for us. We consistently found USPS and UPS to have like prices and Fedex being much cheaper.

Hint, NEVER USE YOUR CREDIT CARD for UPS OR FEDEX. Both have account services that may save you 10% initially but in the long run, when those *additional fees* are attached, you lose!

We always pay in cash at Fedex. There is no ability to tack on extra charges and we still make out much better than before.

Fedex has FREE insurance up to $99, USPS does NOT.

Fedex has a web based updated, center to center tracking INCLUDED for FREE, USPS does not.

Now, ebay's restrictive calculators only work with USPS and UPS. You can adjust the cost by a couple of dollars into the system and state inside you use FEDEX instead and explain why; people do appreciate the fact you are trying to save them money.  Or; Since we live on the far west coast we use a USA map and broke it down into 5 zones using  a paint program to draw lines along state lines based on where the prices go up. This way no one is paying too much. It is much more fair than a flat rate system. Everyone pays a price based on shipping to their general area.

Ebay has also changed their search feature to include shipping in the total prices. If you do not actually input a price on shipping into the program; your item will come up at the bottom of the search list and rarely get seen. On items we know we can ship for one price, we state that price.  Otherwise our items are usually rare enough to not have to use that feature.


In our 7+ years, there is no doubt in our experience that this method has worked much better for us.  Here are just a few of recent FBs=

Beautiful Items. Great communication. Quick shipping. Super packaging. THANK YOU

Great fast shipping!!! Got in time for Christmas!!! Great Communication

Incredible seller, super easy to work with, answers ?'s so fast.Beyond excellent

Great transaction & unbelievably quick shipping. Thanks!!

BEST Seller on E-Bay, excellent communication, honest and fast shipping!!!

Excellent! Item as described, secure packaging, fast shipping!!!

Shipped quickly, item exactly as described, good communication. Thank you!

Bottom line, compare what you are shipping to the services out there and give your buyers the better option = more business, profit and happy customers for you!

 
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