Reduce your shipping costs
Shipping is one area of selling strategy that I think new sellers over look. They lose a lot of money and are less competitive because of it. EBay shoppers tend to be bargain shoppers looking for the best deals on the internet. They compare prices on merchandise, as well as shipping prices.
Now put yourself in the shoes of the shopper for a moment. Imagine that you were browsing for merchandise that you wanted. You stumble upon the listings of two different merchants who are selling the same exact item at the same price. The only major difference between the two listings are the shipping prices and options. All other things being equal, which listing would you choose?
Exorbitant shipping fees (gouging) are prohibited on eBay. Since eBay allows sellers to set their own shipping rates, it is wise to set shipping prices as close to the actual shipping costs as possible. Keep in mind that eBay charges a final value fee on the shipping. The higher the shipping cost, the higher the final value fee. Therefore, it behooves the eBay seller to keep shipping fees and costs to a minimum. It benefits both the seller and the customer.
Weigh everything that you ship
The first thing you will need is an accurate shipping scale. This is so that you can actually weigh the item that you are selling and calculate out the shipping costs ahead of time.
The type of shipping scale that you should purchase is dependent on your business needs. An industrial postal shipping scale may be best for some larger e-commerce businesses, whereas a consumer postal scale may be better for low volume, smaller business sellers. If you plan to sell some light-weight items, then a low cost consumer shipping scale is sufficient for your needs when starting out. Good digital shipping scales are available for cheap on Amazon, eBay and at office supplies stores.
Buy a shipping scale designed for postal shipping, with the capacity to accurately weigh the types of items that you are selling. Make sure that you purchase a digital scale that weighs in increments of at least a tenth of an ounce. I purchased my first shipping scale from office depot for about $30 dollars. It has an 11lb capacity, which is good enough for the items that I usually sell.
Weigh the item along with the packaging material that you will use. Then, input the shipping weight into the eBay item listing. Once you know the shipping weight of your items, then you will be able to accurately charge for the costs of shipping through the different carriers. On eBay, sellers have the capability to enter shipping weights on the backend for each product listing. The seller will have a pretty good indication of how much shipping will cost for each item and the shipping fees for each type of service offered.
Factors that impact the cost of shipping include package dimensions, weight and where the items is being shipped. If you know all of this information, then you can easily figure out shipping costs, give or take a few pennies. Don’t forget to factor in complete shipping expenses (supplies, gas, etc.) into the price of the item that you are selling. You also have the option to include a shipping and handling charge to customers on the backend as well. This is where I add in the cost of packing materials.
Selecting your delivery service or carrier
Which carrier should you use? Well, it depends. Most consumers and businesses ship parcels via the USPS, UPS, or FedEx. Others choose a freight service for bulky and heavy items. Determine which carrier offers the best value and efficiency for the type of shipping service that you need. The USPS usually offers the best value for parcels that weigh 13 oz. and under via their First Class Parcel delivery service. The USPS also offers low cost Media Mail service for certain types of package contents (books, CDs, DVDs).
When possible, I ship packages weighing 13 oz. and under through First Class Parcel instead of Standard Post. You can easily save money by sticking say, a small lightweight clothing item in a bubble mailer and sending it by first class parcel. Plus, it is much cheaper than parcel post and the customer will get their merchandise faster.
Some customers don’t like to use USPS shipping services due to problems with packages getting lost in the mail. So, they rely on higher priced (but more reliable) carrier services from UPS and FedEx. They all offer shipping discounts for businesses that ship in volume.
Save on shipping supplies
Always recycle shipping materials. Whether they are shipping boxes, envelopes, bubbler mailers, packing peanuts, bubble wrap, remember to save them all. Break down boxes that you receive and set them aside for later reuse. Sometimes, I check Craigslist and Freecycle for listings of free shipping supplies and moving boxes.
Another thing that people don’t know is that the USPS has free Priority Mail Flat Rate® boxes and envelopes available for shipping. Some of them may be available at a local post office and others can be ordered at the USPS website. Have them shipped to you free of charge. The added benefit to using Priority Mail® shipping is that free USPS tracking and insurance up to $50 are included.
Order cheap shipping supplies in bulk from a wholesale supplier of shipping products like Uline or find sellers on eBay who sell discount shipping supplies. The most expensive way to get shipping products is to go to a regular retail store and buy shipping boxes and packing materials individually. The practice of buying “as needed” is okay for the casual, occasional eBay seller. However, this is not a smart move for the seller who ships moderate to large volumes of merchandise. It might not to seem like much but those extra $.30-$.50 or more that you pay per individual shipping supplies add up over thousands of packages.
Purchase postage online
There are quite a few companies that offer online postage/carrier services: The USPS, FedEx, UPS, and stamps.com are just a few. Sellers can also buy reduced cost postage for shipping through the USPS and FedEx directly through eBay or PayPal. I do most of my shipping through the USPS. In my experience, it is so much cheaper to purchase postage online through eBay or PayPal versus going to the post office counter and paying for shipping in person.
It is also more convenient, because you could pay for the postage from your PayPal account. You also don’t have to worry about any transcription errors in addressing the packages because you print the shipping label from the eBay website. All the information is prepopulated and placed on the shipping label. No special labels or printers are needed. The shipping label can be printed from a regular laser or inkjet printer. USPS tracking is free as well, which is a savings of up to $1.05 per package.