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Shipping and handling mark-up


#1

Hello all -

I’ve rarely if ever marked up my shipping/handling for my customers.
Though I do see and notice that it is happening to me in the U.S.
now. I ordered supplies last week and noticed that the shipping cost
was doubled on my invoice.

This does not sit well with me and I disagree with the practice. All
of my own USPS shipping is done online. Pay and print, schedule a
pick-up. Very little time or expense for me besides five minutes of
packing and some tape.

Anyone have any input?
Margie Mersky
mmwaxmodels.com


#2
I've rarely if ever marked up my shipping/handling for my
customers 

This has always been a major beef of mine. "Shipping and Handling"
should not be used as a profit center! These people are treating the
customer like an idiot who is lured in by a lowball price and then
wind up paying a lot more than they would if they looked at the
shipping first. Sure, packing and packaging is a cost of doing
business, but it should be reflected in the price of the product,
not “S&H”. Granted, I don’t deal with precious metals, where the
insurance becomes a factor, but most supplies don’t fall into this
category.

Lee (the saw guy)
knewconcepts.com


#3

why was it doubled? what was doubled? if there was a base price
given how did the company calculate the difference you expected?
regarding handling i always ask if part of the company’s doing
business involves an employee or drop shipper physically getting the
item into a box why is there additional handling involved?. or I
state I don’t want my items handled. just put it n a box and mail it
or use a flat rate mailer if its an option and small enough to fit in
x size USPS priority container.

As for my own mark-up I assess the costs of overhead when
calculating price before shipping. If its an item that is warehoused,
or it’s a cutom order it must be handled- and in that case the price
reflects tha nature of the item - but in my case it is usually an
order for raw materials that are cutom karated and coloured gold and
then further milled ( meaning drawn or rolled or billetted, if not an
order for a recut or faceted parcel of stones cabs, etc. , or an odd
amount of x over a standard catalogue line item ( i. e. - someone
wants 57 dwts of a master alloy that is pre-packed into 30 dwt
containers, or someone asks if I can split a 5 kilo parcel of
cuttlebone to accomodate their not-for-profit organization’s small
class size being offered on a one time basis for free to low income
participants for making a token for therapy or some such OT related
notion). i know that the students of that class won’t in all
probability buy again so the price reflects my presumption on the
cuttlebone, but the master alloy is probably going to be used by a
repeat customer if not an account holder so a standardised shipping
table exists for repeat customers and other orders are on a per
order basis.

Knowing your costs is essential in figuring what to charge for S & H.
I have found USPS flat rate mailers reasonable if its not an item or
items that must be insured for over 1700+ bucks per oz. as is the
current gold spot- silver being reasonable to use a flat rate maile
if its a small order like those to hobbyists or one time orders of
less than a pound of assorted small items. Even then items are
insured but for far less than gold requires. Calculating insurance
and offering limited options can be done by creating your own forms
on line ( if you are taking orders from a website and offering carts
on the site) that are flat rate in nature. For mail order or from
custom orders you must send out figureing the costs before or at the
time of taking the order is imperative- or the time and energy it
takes to pack, and get tit to a shipper provided you aren’t calling
for a pick up which changes the costs involved to a degree. If
including transportation ( gas, taxi etc. ) those should be added in,
but s standard doubling the actual cost is not really approrpiate or
in my opinion ethical- you should be making money on your item not
shipping. If you spend a great deal on packing supplies ( like those
formable packs that are air activated and cost 22 bucks per piece up
to 30 bucks for large size packs) then giving the customer that
option is an up front add-on charge in addition to the cost of
shipping… It sounds like you are shipping the most basic way
possible though- if you want to add a premium for the ink cost ( or
toner) and supplies ( tape, etc. ) as they all cost money and you
haven’t figured those costs in overhead when setting your prices you
may add it to the flat rate costs you offer as options >Personally
its obvious to me when a seller of anything is making money on their
shipping and I pass those sellers up for that reason alone- there is
nothing one vendor has that can’t be gotten elsewhere for a
reasonable flat rate cost. I ask for flat rate shipping often and get
it more often than not. UPS in my area is not my choice for many
reasons- but New Orleans is different than most other places on earth
since katrina- 6 years after the flood things are still not working
right including deliveries getting to studio or home on time, or as
promised while the USPS option for flat rate mailing is actually more
reliable as the same individual knows their routes while delivery
companies seem to be using temps still. Even with that caveat
related to place the cost of a flat rate is appreciated by customers,
and easy to figure out in your shipping management.

back to your recent experience though- contact the company that
invoiced you and ask why the cost you expected was doubled- may have
been a mistake. or oversight, or just plain greed. look at the label
and see what is printed on it and then call them for an explaination
and refund!


#4
I've rarely if ever marked up my shipping/handling for my
customers. Though I do see and notice that it is happening to me in
the U.S. now. I ordered supplies last week and noticed that the
shipping cost was doubled on my invoice. 

I have noticed this as well with things I’ve purchased through the
mail or had sent by overnight companies, and yes, it’s annoyed me
too. However, I figure it’s part of the service if I’m ordering from
a company and having it sent to me at my place of business. After
all, the company I’m buying from has to pay for the packaging to
properly ship the order, the cost of the manpower to pack the stuff,
and the fuel and transportation to get the package to the shipping
company if they don’t have someone coming by. Those things do add up,
as I’ve found to my own chagrin.

Still…if it’s obvious someone is simply adding on extra to make a
little extra profit in the deal, then I get picky and think twice
from ordering from them in the future.

Just my two cents…


#5

When people inform me what the S&H is before they send it, I have no
problem. I can turn it down then if I feel put upon. Now it seems
there are four things for certain - death, taxes and S&H.


#6

Thank you for your feedback Kathy and one other member. Here’s what
happened. I ordered $18.00 total for a gemstone. The shipping that
they charged me is $12.65 On the envelope that was shipped the
actual postage is $2.68

If the company has twenty orders a day that’s quite a profit!

Margie


#7

I agree with you. This bothers me too. I don’t see why anyone needs
to mark up shipping, and especially put on a handling fee if there
is profit already made on what you are buying? They are not having to
deal with public, wait on a customers, pay an employee to do it,
deal with putting it in a box and bag, in person…stores do not
charge a personal handling fee, so why in the world do people charge
more for shipping than what it costs, or add on what would cost
possibly the box which is ok to me, but yes, it is pretty much point
and click today with the post office picking up packages in the US.
Even the round stamp for international shipments can be done online.

I am in Mexico. Here shipping is reasonable, we are considered the
same as Canada by the US Postal Service. I see so many businesses
unwilling to ship to Mexico. I don’t get it. We have a good solid
service, I have received and sent 100’s of packages, nothing lost.
Stones, Silver, Precious Metals, Tools, all has gotten here fine. It
isn’t too slow, I get things from the US in about 10 days, sometimes
in 4. But what really gets me, once I convince the person to ship to
me, that it will work, etc…they want to charge me twice or 3 times
more than what postage costs…if I ask them if they will charge
actual shipping, I never hear from them again. Why would anyone want
to lose a sale in this economy? First Class International Airmail is
a lot cheaper than Priority Mail, Flat Rate Boxes included but it
gets here in the same time, so it makes no sense to do Priority
unless it weighs a certain amount. I would buy so much more, with my
US Credit Card, if people would ship to me in Mexico! Forget UPS, Fed
Ex, DHL, those are totally unreasonable, besides you get charged
taxes and duty everytime, with regular mail we are never charged
taxes and duty (as it is supposed to be under $300 US value).go
figure.

So now I order a lot from the Chinese, I have a few contacts who are
honest and reliable. I also order from Britain, and other countries,
they have no problem shipping out of the country…to Mexico. But I
see a lot gripe about sales, open up your doors…there are a load of
people out there, if you would just accept to ship outside the USA,
and that doesn’t mean just Canada…


#8
These people are treating the customer like an idiot who is lured
in by a lowball price 

First I’ll say that we charge exactly what the shipping costs us,
except I generally make it a round number. One client we deal with
frequently has a charge of $23.75 or something, and I just make it
$25. That’s an aver sion to odd numbers, not that I need the buck
and a quarter or whatever.

As to Lee’s quote - on Ebay they call them “shipping pirates”. I
watch alternative TV more than network, and they have cheap ads a
lot. “Your {always diet pills} are FREE, just pay shipping and
handling”… yeah, even though it’s cheap TV, they just donated a
video ad and the air time all for your benefit. I was born at night,
but I wasn’t born LAST night. In some ways this is just bitchin’ and
moanin’, yes. We refuse to jump on that bandwagon, though


#9

That’s exactly the kind of profiting from shipping that is really
unethical.

…if you really like the stone keep it- if it too wasn;t worth the
cost consider sending it back and ask for a refund of the entire
invoice… This seems to happen alot on ebay/auction sites in
particular - but if you bother to open a dispute you’ll get yoour
money back when you return the stone.Even if you don’t return it i
think there are provisions for recovery if the seller didn’t have
some shipping policy stated- it’s that fine print in those seller’s
shipping policies that people rarely read until after a last minute
bid !

Yet another reason i gave up on ebay at least 6 years ago, when
shipping became outrageous and all too commonplace! i had some
findings ordered that were stamped .999 Ag or 18-22 kt and did not
contain even 1% of either metal ( though the sellers seemed to be
located in the US and Uk they turned out to be Chinese companies and
notorius for selling items as precious metals with , perhaps, a thin
plating of gold or silver if you get lucky ! ) -The sheer hassle in
getting it resolved was enough to make it so I have never looked
back…( in fact I think ebay is on the downswing-- they just closed
the money market fund closely related to the company ( through
paypal)…the corp. is loosing money and customers and becoming a
haven for scam artists taking advantage of the unsuspecting …the
FTC and other US agencies are getting more and more involved due to
complaints and fraud and there are too many things one has to be
cautious of…, )…rer


#10

Proper packaging actually DOES cost money, and it can be quite a lot
of money depending on what you are shipping, and how careful you are
in packaging it. I am currently having issues with a printing
vendor, who is doing a great job printing some banners I ordered -
but then rolls them on nothing and sticks them in a collapsible box
to ship them across the country - so of course they arrive creased
and squashed! They just can’t seem to “get” the proper packing part
of the equation!

As I said in another post, I do a bit of eBay selling of a range of
non-jewelry items. I DO charge a handling fee, based on what it is
going to cost me in time and materials to properly pack the item.
The shipping I charge what it actually costs - that is effectively
my cost. But good boxes aren’t free, all packaging material isn’t
free, good shipping tape isn’t free, and the time to use all these
isn’t free. I do NOT include any of this in the cost of my item, as
I would then be charging the person buying it at a craft show for
packaging costs they did not incur. That does NOT make sense to me!
The person having the item shipped should pay the packaging fee!
That said, some items cost essentially nothing to pack, most a
fairly modest amount, and some a good bit more. The customer should
ALWAYS know ahead of time what their shipping and handling cost is!

Beth Wicker
http://www.bethwicker.com


#11

Margie:

Did they have a policy in effect at the time about how they figured
the shipping costs? And do they tell you in advance approximately how
much the shipping costs should be - giving you a chance to say NO?

I must say I find this difference slightly outrageous if it is JUST
shipping. Did they insure the stone? or ship it 1st class? I think
I’d question this - I do find it a big excessive for such an
inexpensive stone.

Kay


#12

I would contact them and suggest there was an error in the shipping -
nice, polite way to point it out! It might, in fact, have BEEN an
error! I sell a lot (not jewelry) on eBay, and find that every now
and then their shipping calculator just flubs - the shipping charged
is way out of line of my actual cost. But I’m small enough that I do
pay attention to each transaction; a big company might not. When
this happens on one of my transactions I either refund the difference
through PayPal or stick cash in the order, depending on the amount
and what they want85

So really, it IS possible this is an honest error - at least give
them the chance to fix it85. because that difference is certainly
excessive!

Beth Wicker
bethwicker.com


#13

I’ve been shipping both to U.S. locations as well as around the world
now for a bit over a decade. My observation is this, it is a lot more
expensive that some folks think it should be or is. This is
especially true of overseas shipments. Requirements for some
countries when shipping silver say it must be shipped with insurance
or registered mail. Believe me, registered mail is very expensive,
and some methods of shipping don’t even allow insurance, so you are
forced into sending the item at a higher rate. I recently priced
shipping a rather small package to Australia at over $40 when
abiding by the rules because it had silver in it. Shipping to U.S.
locations is much lower cost, but packaging materials are not always
free, nor is the labor to do the packaging, or the transport to the
shipper. True, if you ship priority mail you can get a free box from
them, but not everything fits in those boxes, and shipping via the
flat rate boxes can sometimes be exorbitant.

I offer free shipping to my customers within the U.S. and actual
cost shipping overseas. I do have to eat a fair bit of the expense of
doing this, but I consider it a form of advertising. I am seeing a
lot more Internet businesses offering free shipping for a limited
timeframe, and expect to see more do as I do in the future, if the
postal rates stay the same. However, I expect they will continue to
go up. Then I may have to change my policy.

Personally, I abhor businesses who overcharge for shipping. I have
found that offering low-cost or free shipping does bring me more
business than when I used to charge for it. In fact, it brings in
more business than any of my other advertising, plus it develops a
sense of trust in the customer. Businesses who try to make an extra
buck via shipping and handling are really being dishonest about their
prices. That tends to make customers lose trust in them. Nobody likes
to be lied to, and they are in fact lying about their prices by
padding the shipping cost.

Overall, I will say the Postal Service does a good job of getting
packages to their destination. They are not perfect. They could be
much better if they scanned each package as it progressed through the
system, as does UPS and Fed Ex. However, I expect then we would have
to pay UPS or Fed Ex rates. In the long run, we may have to do so
anyway, considering the bad financial condition of the postal service
these days. I have heard that they must fund retirement for employees
that have not even been hired yet, as a mandate from Congress. No
wonder they are having difficulties!

Susan
Sun Country Gems LLC
suncountrygems.com


#14

Proper packaging actually DOES cost money,

I am in complete agreement here. Few things make me angrier than
receiving something once lovely but now damaged due to hasty or
clueless packaging. Careful packaging is something I’m very willing
to pay for. I’d like to think a “sender” will take the same careful
time I put into preparing a package to ship, and in no way begrudge a
surcharge over the actual costs of postage. How nice it would be if
things we need to send and receive could just magically insert
themselves into boxes, securely packed, taped, & addressed (into free
boxes and taped with cost-free tape as well). Until then, a handling
fee seems logical to both pay for and to charge a customer.

Virginia


#15

I agree about proper packing materials and their cost- Look at a
Uline catalogue if you want to get an idea of high quality materials
for every purpose and class of item shippable- But what is at the
heart of this post is a gemstone ( single from what i recall) not
necessarily in a gem jar ( plastic thing with foam- costing about
4.00 for 18-20 5/8" containers, or a dozen slightly larger ), and
costing 2.68 to get it to the buyer ( marge)-

I can’t imagine it costing more than 4.50 and that’s with the few
minutes of lighting,ac on, electricity to run a pc and printer and a
lot of other presumtions divided by maybe 4 minutes of time- ok, 6
minutes of time …the cost was as Beth put it, perhaps an
error…nonetheless, ebay sellers are notorius for overcharging, as
are tv ads offering “free” product and the s&h covers the costs plus
posting…she got taken…lesson hpoefully learned…

most “gemstone sellers” on auction sites are resellers- one is lucky
if they wrap a parcel in a gem paper and then cushion it before
dropping in a padded envelope to send it. Most don’t insure even
internationally while a few require insurance ( some actually add it
some don’t) unless it’s an actually valuable stone, cab or parcel-
collecting on insurance is a hassle requiring months if sent USPS,
and slightly less with UPS…fed ex insurance and post for jewelers is
worth the cost if its a valuable item or shipment ( the locked
aluminum container is what I’m referring to ) as is jewelers mutual
or other specific insurance if you are in business out of your
house…( there was a thread reccently about policies and having a
home studio- it’s in the Orchid Archives) but we are talking about
an 18.00 stone with the shipping and handling costing almost as much
as the product and NOT professionally packaged…


#16

My shipping cost starts at $5.00 as that is the cost of a small box
by USPS Priority Mail when I print the label at home. Insurance for
$500 is about $7.00 on top of that. I do not charge domestic (US)
customers for the shipping.

John


#17

It’s been done to death, I guess, but I still feel the need to toss
in a penny or two. When I expect to sell one item at a time, I just
include the cost of shipping in the price of the item. If I have no
idea how many items might go in an order, I charge a flat rate. That
way, if I’m shipping enough items to lose money on the shipping, I
can afford it, and if I am only shipping one half-carat amethyst, I
at least break even.

When I set new shipping rates, I add a fudge factor for packaging
materials and such, and also to cover (I hope!) the next couple of
postage rate increases. That way I don’t have to update my shipping
rates every time the Post Office decides they are going broke, and
my customers don’t feel like I’m charging more for shipping every
time they place an order.

Don’t know if that’s the right way to do it, but it seems to work
for me.

Steve