So you’ve got a great product, an easy to navigate website that leads customers right to buying it, and a reasonable price – everyone should be blowing up your site ordering it. The next thing you’ve got to account for is that nasty gremlin of shipping.
Until you’re on the shipping end of things, you don’t realize what an expensive and painful process it can be to offer free shipping. First of all, it’s tough to decide which shipping option to use. This site has a nice comparison of USPS, UPS and Fedex. Their bottom line is that USPS is best for most small business shipping and I agree. I’ve used UPS for shipping larger, heavier shipments and will probably investigate it for shipments to distributors (WHEN that happens).
Luckily, I have small, light products that also happen to fit well into standard sized padded envelopes. So, here’s a standard shipment breaks down for me. When I am shipping just one Card Caddy, the dimensions are 4x3x1 inches and I can fit it into a #0 size bubble mailer. Multiples fit well into the larger-sized bubble mailers, up to 8. I haven’t had anyone order more than 8 – I will probably have to use a box at that point.
My online store through GoDaddy automatically calculates shipping after the customer has placed their order, based on the per unit weight of the Card Caddy and their location. What’s nice is that they use the retail price from USPS to calculate shipping. On the shipping API I use, Shippo, it’s $2.13 to ship from me (in Maryland) to San Fransisco, CA via USPS First Class Mail Parcel. On the USPS website, it’s $2.74. Shippo charges me $0.05 per shipment, so it’s really $2.18. The shipping labels are another $0.10 apeice and the bubble mailers around $0.25, so in this case I come out ahead $0.21. Some shipments are more, and the mailers are more expensive as they get bigger, so on larger orders, I end up losing a few cents. I can live with that.
So, my big challenge now is to figure out how to offer “free” shipping. Since my MSRP is $6 and shipping costs around $2.50, that’s a big percentage of my total retail price eaten up. Since I’ve only had the site up for a few weeks, it’s tough to tell from the analytics how many people are dropping off the site once they have put stuff in their cart, but then calculated the shipping, i.e. been turned off about having to pay for shipping. Shipping’s like lunch – there’s no such thing as it being free.