How do Chinese sellers afford free shipping?

 It's obviously a very cheap method, as it can take 6 weeks to arrive. The packages have pre-paid labels, some through Hong Kong, some through Singapore, some apparently direct, obviously they are paying something - I've heard they get volume discounts. But even so, when the cost of goods is so cheap, I don't understand how they make any money.

 

Anyone know?

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How do Chinese sellers afford free shipping?

One reason this is being marked as a ZOMBIE THREAD FROM 2013

is that much of the information in it is out of date and incorrect.

The Universal Postal Union (founded 1874 and now a part of the United Nations) worked for some years to persuade /force China to give up its status as an underdeveloped country (like Liberia or Paraguay). Such countries are given subsidies to their overseas mail by the richer Western countries.

Basically, all UPU members agree to deliver mail from all other members, and do some very fancy accounting to recover the costs of the delivering postal system from the sending postal system.

Western /developed countries agree to complete deliveries from underdeveloped countries for less than they would charge an equally wealthy country.

 

Basically, in addition to speaking softly, the Western nations were wielding a big stick.

Low value Chinese shipments were given the lowest priority by the Western postal systems.

 

We saw the struggle in the form of complaints from eBay buyers whose small, untracked, and 'free shipping' purchases from China were being held at Customs or by Canada Post for months.

 

China caved around the time of the last UPU congress held in Istanbul in the Fall of 2016. *

China  agreed to raise their international package rates over the next five years or so, to cover the actual costs of delivery.

 

This should mean that by 2020, the cost of buying, person to person, on eBay from China will rise considerably.

 

It will not affect the cost of commercial shipping, which does not use the world postal system. So if you need a container of patio chairs, the UPU agreement will not change your costs.

 

 

 

 

*Before the US elections, for the record

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How do Chinese sellers afford free shipping?


@femmefan1946 wrote:

 

This should mean that by 2020, the cost of buying, person to person, on eBay from China will rise considerably.

 


That is a good summary of it. I suspect for larger volume sellers they'll continue to work together with ebay on finding 3PL partners in the US. Ebay actively has a program to work with Chinese sellers for doing just that already.  The other thing is the Chinese government may elect to simply raise their current subsidy rates to offset the increase as well. 

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How do Chinese sellers afford free shipping?

They just put all the packets into one container - ship the container to Vancouver or Seattle and let Canada Post or USPS do all the work. Hey - I can buy an item in China for $10 and they send it to me for free. To buy the same item in Canada - first of all it would cost me $30 and then $75 to ship it to China. Unfair playing field don't you think.
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How do Chinese sellers afford free shipping?

zombie.jpg

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