Yes, you read that correctly. Sellers can save money, reduce shipping costs & be more compeditive, simply by shipping smarter. There isn't any trick or hidden gimic. All a seller has to do is: 1) Think smarter, 2) Do a little research and 3) USE the free tools avaliable to them. The technique i'm about to explain can be use by all sellers; Seasoned, Part time & New sellers alike.
Before I start, there are some requirements a seller must have. You'll need to have or purchase a printer and postage scale. These 2 items are curtial to making this work. If you don't have either one of these, you can purchase them from good sellers right here on eBay.
In the following example A, i'm going to lay out some bullet points detailing a recent purchase I made. I'll reference back to these bullet points, showing you how the seller could have maximized shipping costs, compeditivness and gotten more bids, by shipping smarter.
- Seller list widget in auction style with a starting price 1/4 of what the average completed listings show as a final selling price
- Seller lists Item with a calculated shipping cost of 11.oo
- Item in it's own box measures--- 6in x 6in x 1-1/2in thick
- The item wieghs 12oz, when mailed in a #2 bubble mailer. I knew this prior to my bidding, as I purchase many of these.
- Seller ships this item to me via USPS Priority Medium Flat Rate Box
- Actual Postage cost: $10.58
- I am in that sellers USPS postal zone 2
Now, lets dig in and Think/Ship Smarter............
You have your items you want to sell, and maybe you already have them listed. Have you...............?
- Listed them with Free shipping, Flat rate or Calculated? It really doesn't matter.
- Do you know each items wieght? Or the wieght of the item as if it was boxed and ready to ship?
- Do you even know how your going to package each item you have listed? Or are you waiting until the item sells to figure it out?
- Researched shipping options and their associated rates? Or are you just guessing?
- Ever over charged a buyer on shipping? Or do you find yourself consistantly under charging, thus paying some shipping costs out of your own pocket?
- Found a supplier of shipping supplies at the best price? Or do you just pick them up/purchase them from the same old place? Or rely solely on the USPS for FREE priority products, because they are FREE?
If you haven't thought, each and every one of those points through, then your not thinking/shipping smart. Remember my seller from example A above? They weren't thinking/shipping smart either. They listed with calculated shipping without knowing: What the item wieghed, How to properly package it, Alternate shipping methods/rates and relied solely on a limited supply of USPS mailing boxes.
They also paid more than I payed them for shipping via FVF's. That's right, with the 9% (.99cents) FVF fee on the 11.oo calculated shipping charge, they paid .57cents more out of their pocket or profit made from the sale of that item, for a total shipping cost (to them) of 11.57. That doesn't include the 2.9% paypal charged them for that portion of the sale.
Granted .57cents isn't a lot, but do that 100 times in a month and your out 57.oo. Thinking Smart, one would realize that a premium eBay store subscription is only 49.95 a month. Just think, you could recoupe the monthly cost of a premium store cost, just by Shipping smarter.
OK. So I think your starting to get the idea, but where do you start? We'll, you start by...................
Doing some basic research
I know, research is about as boring as it gets. You may not like it, but research is not only key to pricing your items, it's KEY to thinking/shipping smarter. Your research should include.......
- Knowing the size and weight of the items you sell, packaged ready to ship.
- Knowing what the best mailer type is best suited for your item and how to select the proper type.
- Knowing where to get the best quality mailing supplies at the lowest cost to you. Always be on the lookout for cheaper sources, without sacrificing quality.
- For items over 13oz that cannot ship USPS First Class, you need to know ALL the USPS Priority options avaliable for use.
- Most importantly, you need to know the shipping rates for each mailing class. I suggest printing a copy of USPS: FC, standard Priority and All Priority Flat Rate options, and keeping them in a binder for quick reference.
- Don't forget to check/compair rates with UPS or FedEx when you have a heavy/bulky item. These two shipping options often go overlooked, and they can save you money -v- USPS.
Researching these areas, and becoming familiar with shipping options/rates, will help you think and ship smarter. Because my seller from example A didn't research these areas............They didn't know the weight of the item, the best packaging to use, where to get the best rates for shipping supplys and more importantly, they didn't know the diferent shipping classes. Had they done any of this research, they would have found that item would ship just as safely by: 1) 12oz in a #2 bubble mailer for 3.28, 2) In a USPS Padded envelope for 4.90 or 3) USPS Rate A box for 5.06, yet they chose to limit their options to a medium flat rate box and loose money.
Not only did they loose money on shipping, they lost out on bidders due to the excessive calculated shipping choice for that item. Three things I want to clerify:
- Yes, I know what some of you are thinking......If you thought the shipping was high, why did you still bid and buy the item? A) Because I knew bidders would shy away and not bid. B) Because I was the only bidder, knowing I could relist and sell it for a 30.oo clear profit. That item sold 3 days after I listed it with a proper price and postage cost. On a side NOTE: It's not "Thinking Smart" to severely undercut your competition.
- Had the example A seller done some extra research, they would have seen most compeditors charging a flat shipping cost of 5.99-6.99 for the very same item. The seller also lost money by sending prospective bidders & buyers to other sellers with better, more in line shipping costs.
- I am in NO way, shape or form suggesting you skimp on packaging. What I am suggesting is to select the best mailing type choice, that gets the item safely to your buyer, while not over paying for postage.
Did you know? That the USPS rates increase on 1/22/12, and that an item packaged weighing 1 lb, can ship to ALL 8 zones via regular priority, cheaper than it can ship to all 8 zones via USPS Rate A box? A 2 lb regular Priority package ships to all 8 zones for the same rate as a USPS Rate A box. Even a 1 lb, total boxed weight, item that would ship nicely as a small flat rate box, will ship cheaper as regular priority to zones 1&2.
Tip: When using the Calculated shipping option for items that have to ship Parcel Post or Priority (other than flat rate boxes/envelopes): Find out what the actual postal cost for the item going to your zone 8. Then add 11% of that cost to your items BIN price or auction starting price. That 11% should cover all FVF's charged by eBay for that shipping charge.
Example: Postage cost for a 6 lb Priority package (to big to fit in a flat rate box) going to your zone 8 is now 20.47. By adding 11% or 2.26 to your items price, your able to keep the item price lower and cover the FVF's charged by ebay for the postage side of that transaction. Note: if the item sells to a buyer in your zone 6, then the postage cost to that buyer is only 16.31. Your still covered with the FVF's and will be .46cents ahead, since 11% of 16.31 is only 1.80.
Also, don't over pay for First Class postage either. For example, I sell a line of items, that when boxed have a shipping weight of 9oz. Since these items are ridgid on their own, they can be shipped in a #0 bubble mailer at 6oz. The box would cost me .24cents each -v- the .14cent bubble mailer. Not only is there a shipping supply cost savings, I also save .51cents in postage for each sale. I know the bubble mailer is the right choice, as I have sold hundreds of this item with zero complaints from my buyers. Since I haven't reduced the items selling price, i've now added .61cents to my profits bottom line each and everytime I sell one of these. All due to simple research.
Only you know your items. Select your shipping container and method wisely. You want the item to ship cost effectively, but more importantly, it needs to get there safely and undamaged. Getting this right will add $$$ to your bottom line, which leads us to.....................
Using the avaliable FREE tools:
There are hundeds upon hundreds of Free tools to help you sell better. Infact there are too many to list, so i'll list the basic ones that I thing are best suited to shipping...........Note: I can't actually link to some of these tools, due to the guide writing policies.
- Google USPS (United States Postal Service). On this site you can view, print and compair rates. You can even order all of the Pirority maling supplies, having them delivered to your door. Remember; Regional Rate A, B, C boxes and the Padded envelopes can only be obtained in this manner, as they are not avaliable at the PO, and Postage for those MUST be printed online.
- eBay search: this seems simple, but it is a powerful tool when used properly. You can search for any item, and then by using the left side links, search: completed listings, listings with/without free shipping & BIN's/auctions. Searching completed listings allows you to see the sold results of items you wish to sell. This gives you an idea of the average selling and shipping price buyers are willing to pay. Advanced viewing of all the options allows you to go in and see what thoughs sellers are charging for shipping, and whether or not buyers are actually paying the posted shipping. You'll see the highs and lows, as a lot of sellers don't have a clue: such as the flat costs that end with .99cent, i.e. 2.99, 8.99, 15.99 & ect. This tells me that seller doesn't have a clue, their padding to cover FVF's on postage costs or they are adding in a handling charge. Regardless of that, i've never ever printed a postage label that ended with .99cents.
- Google: rolbe.com. This free "eBay Fee calculator", created by an eBay member is great, as it can show you all sorts of information about the item you want to list: eBay/paypal FVF's, break even point, profit when item sells and even allows you to play with the numbers. Point to remember: You can't get acurate results if you don't enter the proper information. So knowing the postage cost of your item is KEY to using this tool correctly for maximum profits.
You should be reducing your overall shipping costs and maximizing your shipping options by:
- Researching options and alternative shipping methods.
- Knowing the weight of your item as if it were ready to ship, prior to listing.
- Knowing how to select the proper mailing packaging & shipping option for your item, to minimize postage costs. Again, NO skimping here, as you need to get the item(s) undamaged to your buyer(s) as profesionally as possible.
- Utilizing all free selling tools to help with shipping.
The information and tools are out there. All you have to do is adapt and apply them to your business model. You will enjoy the savings, see more profit and as an add bonus: You may see your sales start to out perform your competition, as you now have the compeditive edge over them in the shipping area.