To Ship Free or To Not?

[gilliankehler]

I've been selling my unwanted new and used goods (clothing, shoes, bags, jewelry etc) on eBay for about 5 years now. I recently switched all my listings to free shipping (worldwide) after reading extensive articles on how free shipping is a good idea. And I must say my listings have been receiving a lot more attention, and I've been making a lot more sales, since I switched. Whether that has to do with the free shipping, or some other factor such as increasing seller rank or more sought-after products, will remain undetermined, unfortunately!

But lately I've been contemplating going back to charging for shipping because of my extremely low profit margins. I don't expect to make pure profit due to the nature of what I'm selling, and the fact that this is more my hobby and not my official "job", but I get to keep literally 20-40% of my sales after shipping and ebay/Paypal fees. And when I get an unhappy buyer I have to refund, it puts me out BIG TIME. Some items I instantly lose money on because the buyer lives in a remote location and shipping just so happens to be astronomical to that little villa in the middle of nowhere, so as soon as I get to the post office I've already f-ed up the sale...  if the buyer is unhappy, I'm double f-ed!

My secondary concern with free shipping is that the buy-it-now price sometimes appears ludicrous when the shipping is factored in, and in comparison to other similar products, mine looks far more expensive when in fact it's cheaper due to no shipping charges.

Just wondering if I could get some input on whether a seller such as myself should be doing the free shipping thing? Or am I better off charging for it? What is working for you? I want to be as successful as I can be.

[ricarmic]

Hi Sequins!

I think you answered your own question: "my listings have been receiving a lot more attention, and I've been making a lot more sales, since I switched"

Whether you are making enough money is a different question, an exceptionally important number that I think a lot of folks don't know is the actual cost of goods sold.

The cost of goods sold includes:
-original cost of the item
-cost of fees to list, sell that item
-cost of fees for currency conversion
-apportioned "self insurance" cost of lost packages, or insurance cost
-shipping cost (when it is included as free shipping)
-cost of envelopes, paper
-apportioned cost of computer, internet connection
-apportioned cost of space in your house, place you rent do do business
-apportioned cost of gas, car maintenance etc
-etc etc

Markups for folks trying to make a living wage will need to be higher than folks disposing of their own articles.

[pierrelebel]

As you have experienced, "free shipping" (shipping included in the cost of the goods) works.

However, looking at your items, I would suggest you change your policy to:

- "free shipping" to Canada

- flat rate to USA (slightly below Canada Post rates)

- higher rates for international (anywhere but Canada and USA).

[mr.elmwood]

It has been said that not all product lines react favourably to "free" shipping. My experience has been very good.

A particular line of parts that I had listed as $21.99 + $8 = $29.99, I sold one in five months. Moving to $29.99 + 0 = $29.99, I sold five in one month.

Glove box handles at $16.99 + $8 = $24.99 sold poorly. Switched to $27.99 + 0 = $27.99 and they fly off the self.

I do not compete with the low price sellers, I compete with the high price sellers.

I have lost money four times in 10,000+ sales.

People do not buy based on price, alone. They search pictures first, not price. Pictures are the hook. They have already made the decision by the time they get to the price.

[gilliankehler]

I agree that the pictures seal the deal, it's that way for me anyways when I'm browsing as a buyer. If the picture sucks I'm not even going to click on it or even glance at the price.

On a similar subject, if you don't mind me picking your brain a bit, do you think the format of the price matters? Ie 9.99 instead of 10? 

[rose-dee]

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@sequinsnvelvet wrote:

On a similar subject, if you don't mind me picking your brain a bit, do you think the format of the price matters? Ie 9.99 instead of 10? 

---

Well, I'll chime in here if I may.  100 years or more of retailing, in all its forms, says that $9.99 is always better than $10.00. 

There is a good reason commercial retailers determine price points very carefully.  The biggest ones have professionals doing that work who understand the mind of the consumer and the psychology of retail.  

Buying habits and desires have admittedly changed radically, in the last 50 years in particular, but one thing remains true: a smaller number, even if only visually smaller, and even if the real difference is only a penny or 5 cents, will sell over a larger number.  The key thing is to study what your best competitors are doing and beat them by the same logic. 

I have to add that if you are selling something people need (and perhaps can't find elsewhere, as Mr. Elmwood mentions with his products), as opposed to appealing to impulse buying, then you can afford to be less concerned about undercutting competitors.  The fewer competitors you have, the less the price matters.  Which is why western governments do not like companies maintaining big monopolies.

[pierrelebel]

"says that $9.99 is always better than $10.00. "

Now I feel bad.  I always used $10, instead of $9.99.  It never crossed my mind that I was wrong all those years.

[rose-dee]

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@pierrelebel wrote:

"says that $9.99 is always better than $10.00. "

Now I feel bad.  I always used $10, instead of $9.99.  It never crossed my mind that I was wrong all those years.

---

Yes, but you were selling to collectors, not casual "shoppers", and therein lies the difference.  Discretionary, or "browsing" buyers are a breed that commercial brick-and-mortar retailers have appealed to for decades, and whose habits they know well.  

Collectors who are committed to a hobby (or some even to an obsession), will pay any reasonable price for what they want, and the more they want it, the more they're willing to pay.  Which is why auctions worked so well for sellers of desirable collectible items for so long on eBay.  

I spent many years collecting (in an entirely different realm from stamps), and can't tell you how many times I went over my intended budget when faced with something I felt was a key addition to my collection, or a very desirable rarity.  I do think that sort of buying is in a category of its own.  

[pjcdn2005 · Accepted solution]

Some categories do well with free shipping but as others have mentioned, that is shipping included in the cost of the asking price. I don't think offering free worldwide shipping is really feasible either. Many Canadian sellers will offer free shipping within Canada only and then slightly discount their shipping for other countries since part of the shipping cost is already in the item price.

Deciding on whether or not to offer free shipping at all depends on your category, your cost of shipping and your competition. If other sellers are all offering free shipping, it is often best to do the same. But of course if the majority of your competitors are in the U.S., there cost of shipping is probably less to begin with so still have to figure out how it works best for you.

Of course if you have free shipping to selected locations, you should not have free shipping in your title.

Off topic but a couple of suggestions - I think that it would be better to take the brand names in your titles out of the brackets...it doesn't serve any purpose as far as I can tell.

You make good use of your item specifics but for clothing, I would probably put measurements in the specifics as well. Then if a buyer doesn't look at your description, they may still see them in your item specifics. 

I guess I'm old school (or just old lol) but I find a lack of capitals unprofessional. You might want to capitalize every word in your title and then use proper capitalization in your description. Personally, I think that it is important in both areas but even more so in the title.

[gilliankehler]

I like your suggestions, thanks! It's kinda funny because I just recently put the brand names in brackets and turned everything lowercase, I guess to give the illusion of "style" or something lol. I do see where you're coming from though.
I like the idea of putting measurements in the specifics, I personally would never buy anything without checking out the description first! I guess I always assume, hey if they didn't read the listing it's their fault, but do I really want to go down that road in the first place? Not really, haha.

[gilliankehler]

...But it's OK to have "free shipping" in the title as long as I do offer free shipping for all buyers, right? Just if I changed to Canada only then I would have to remove it I assume?

[pjcdn2005]

But it's OK to have "free shipping" in the title as long as I do offer free shipping for all buyers, right?

Yes. Although if the buyer is looking at search in list view, they'll see that shipping is free anyway. In some cases there might be other key search words that you could use instead of free shipping.

But why would you give free shipping everywhere? If you are shipping a pair of earrings within Canada, it may cost you $1.80 + tax and supplies and you can easily include that in your price. Those same earrings would cost $7.50 plus to send to Europe so would you want to add that amount to your item cost?

[pjcdn2005]

 It's kinda funny because I just recently put the brand names in brackets and turned everything lowercase, I guess to give the illusion of "style" or something lol.

I'm curious how some of the younger sellers/buyers think about no caps.  Perhaps it is a 'cool' thing in their minds and I'm just old fashioned?

I copy and paste quite a few buyer addresses when I send out items using stamps and it is impossible for me to leave even their postal codes in lower case. I have to change names, pc etc.  to caps because it would irk me otherwise! lol

But I have no idea if anyone else ever pays attention to that.

[rosscd57]

Ok - we all know there is no free shipping the shipping cost is buried in the price of the item. Personally I want to see how much I am paying for the shipping and how much I am paying for the item.

Then I make a desision.

There is one exception - the sellers in China see to be able to ship almost free. Recently I purchased three lithium batteries for my land line telephones from China. The Source wanted $29.99 each for a total of $99.97. I bought them on eBay - three of them including shipping for a total of $10.71 Canadian and they were not knock offs.

Amazing!

[ricarmic]

Hi Sequins!

Regarding reading descriptions, in this day and age, especially with the increasing cell phone use, I suggest only expecting your buyers to:

Look at the first picture and read most of the title.

Everything else is a bonus.

I too would read the description etc as well, but it seems to me the vast majority of people nowadays don't read the descriptions....

Put as much worthwhile information in the title as you can fit; with the most important closest to the start of the title....

[femmefan1946]

Maybe this should be its own topic, but I'm wondering, after accidentally listing an item in CDN rather than my preferred USD, and having it sell within moments,  perhaps it is time to go back to listing on dotCOM.

I use Free Shipping almost exclusively now, and I left dotCOM because of the stupid media shipping cap.

I ship 'Free' to Canada and the USA and since I have an excellent source of discount postage, my shipping cost is very low.

Like mrelmwood, I believe the drop in the loonie more than covers the cost of shipping on my kind of stuff.

It's a slow season before Christmas, so I guess I'll take the plunge.

[mr.elmwood]

Three and a half years ago I was spending $8.15 US to mail a Small Packet under 250 grams to the US. That now costs me $6.15 US. That is after several consecutive postal price increases.

the 45% swing in the exchange rate is also added to my profit.

I buy in Canadian and sell in American.

On Wed, the Americans are going to raise their Prime Rate. That will drop the loonie and add to my profit.

In January, Iran will be allowed to sell oil which will further drive commodity prices down which will further devalue the Loonie.

The swing in the exchange rate pays all my eBay and PP fees, COGS, and most of my shipping costs. Free shipping darn near is, to me.

[musicyouneed]

Prior to 2015, I charged for shipping on all my listings.  My sales were OK.  

In 2015, I moved to free shipping to Canada and lower cost to the rest of the world and really didn't notice that much of a change.  

Starting this Dec. I am moving many of my lower priced CD's and ones that have been around for a while to charging for shipping.  To the buyer the price looks lower, but overall it is the same.  

What I have noticed since December that I have been paying FVF's on shipping which I don't like, I haven't been paying those fees for about a year.  

So my decision is going to be that I am going to have some listed as free shipping within Canada and others listed with a cost for shipping and see how that works for a while.  

I look at the minimum I want with shipping included and go from there.  I use the difference in the  value of the Canadian Dollar to cover all my fees, envelopes, supplies, etc.  

[gilliankehler]

Well i picked through some of my listings and the ones whose prices seemed outrageous with the shipping cost factored in, I switched to charging for shipping. So we'll wait and see how this little experiment plays out 😉

The fun thing about eBay is you can always experiment with different selling tactics to see what works!

[rose-dee]

As an aside, one thing I'd mention is that I was wondering whether the photos you use for designer items that show the live models are taken from elsewhere, or are these your own photo shoots?  Strictly speaking, if they're taken from other sites or sources without permission of the original owner, they should not be used on eBay.  

I'm just bringing this up because I see you have several listings with live model photos, and if your competitor(s) or the name brand owner notices one and reports the listing, eBay may take them all down.  If you have permission from the photos' owners, then make sure you keep that documentation handy in case you are challenged on it. 

I agree with 'pj' about the "all lower case".  This seems to be a trend that has caught on with the younger generation, presumably because it makes things easier when thumbing all those keys on a small mobile device not to have to use the capital shift.  However, I think it does make things more difficult to read and understand when you're trying to convey detailed information, and looks less professional than using proper English style.

You can say "free shipping" in your titles -- I'd put it at the very end -- but only if you're actually shipping free to everywhere.  As others have said, I really can't see the sense in providing free shipping internationally (or even to the U.S.) unless your margins are really big and you can easily afford it, or your items are really small and you can always ship with Light Packet.  

The problem with free shipping domestically (within Canada) of course is that once you get beyond the letter mail size and weight (i.e. maximum 38x27x2cm and 500gms), you're looking at parcel services of one kind or another, which are expensive and variable, depending on destination, size and weight.  So it's easier to offer free shipping domestically if you're selling small, lightweight and thin items than if your items are of all shapes, sizes and weights.  It's also easier to offer free domestic shipping if most of your buyers tend to be in the U.S., since you'll be losing less often on shipping rates for the occasional sale within Canada while gaining more often by paying no FVFs.