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Postage and packing

How to work out cost

     
12:55 pm on Jul 20, 2005 (gmt 0)

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I am setting my website up to allow orders to be placed online. I am unsure how to price the postage and packing. We sell a wide range of products. I was thinking of baseing it on weight, but this would mean weighing each and every item we sell. I could just select a fixed rate, but on very light weight low cost items we may loose sales due to the price of the p&p. I was wondering how others have answered this problem?
1:23 pm on July 20, 2005 (gmt 0)

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We weigh each item. Its not often we add a large number of different weight products.
2:24 pm on July 20, 2005 (gmt 0)

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Thats my problem nearly all of my products area different wieght meaning that adding a lot of products (which I have to do in the near future) will require a lot of wieghing.
2:44 pm on July 20, 2005 (gmt 0)

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If you want your shipping charges to be accurate and set up so neither you or your customers are short changed, you have to weigh each item.

Yes, it does add some time to adding new products but it's all part of the game.

3:49 pm on July 20, 2005 (gmt 0)

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Don't forget that the box that all the product go into adds some weight to your shipping weight. So, if you can add a "handling weight" (hw) to each order via the shopping cart, that would be ideal. I charge 0.5 lbs HW for each box, but as products get heavier they require more packing material and a heavier box which can raise the HW even more.
3:50 pm on July 20, 2005 (gmt 0)

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I do see what you mean, and I feel that is the way that I will go. I was thinking of adding a shipping band property to each product. If more than one product is added to the cart then the item with the highest shipping band is used.
4:16 pm on July 20, 2005 (gmt 0)

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Consumers like flat rate shipping. Unless your parcels range all over the field in weight, then pick an average weight, that will give you a break even point on the shipping.
4:38 pm on July 20, 2005 (gmt 0)

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Using shipping tables caused all kinds of problems for me. We had items of all different sizes and weights. Sending the same item within the city, state, or from coast to coast would charge the same, but the charges were dramatically different.

We wrote a direct interface into UPS/FedEx to calculate rates, but we still needed weights.

Initially I set default weights to like .4 lbs, since shipping rates go in 1lb increments. That way the third item in the cart went to 2lbs. Then we put in estimated weights for all the heavy items.

Next we tied shipped orders into the tracking api's, which also report the package weight. If we shipped one item in one package, we would drop this weight in as the new package weight. So our system improved as we shipped.

And of course the last thing we did was request shipping weights from all our vendors and to start weighing items ourselves. We still override with the shipped weight from the tracking because this brings in the shipped weight, not just the item weight.

By calculating accurate shipping, we can charge a small premium on every order, without having to gouge our neihbors while giving a deal to someone across the nation.

But then again, they hit $75, and we give free shipping, lol.

10:09 pm on July 20, 2005 (gmt 0)

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I see you are in the UK like me, and as such we are lucky not to have to worry (in 95% of cases) about offering different delivery levels and prices depending on how far away a customer is. (Our exception being on courier deliveries to Northern Ireland and remote Scottish Highlands and Islands)

What delivery methods will you use? For example, say a next day courier cost 5 and this covered up to 20Kg of goods, would this be about the maximum you would send in one go? And would the minimum be the cost of a jiffy bag and a first class stamp?

Under the above circumstances, we charge a flat rate on all orders of 3.95 with free delivery for orders over 50 in total (our gross margins allow for this).
This is fairly standard in our industry.

I suggest you work out the maximum and minimum costs, and set a price that means that you at least cover your costs averaged over all orders. And check your competitors to be sure you have it about right :)

There's another good thread here [webmasterworld.com] that has some discussion on delivery charges.

jules.

2:17 pm on July 21, 2005 (gmt 0)

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Our normal policy with mail order is to charge the customer what it cost us to send. Anything over 2kg gets sent via carrier. All other stuff gets sent via royal mail. I think that I will have to go down the route of weighing each item. That way it will be better for the customer and us.
3:39 pm on July 21, 2005 (gmt 0)

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Consumers like flat rate shipping. Unless your parcels range all over the field in weight, then pick an average weight, that will give you a break even point on the shipping.

Yes, Yes. Yes! Easy for us to understand; easy for the customer. Only the smallest customers get a bad deal.

If our average UPS shipment costs $6 (easy to figure) and we charge a fixed $7 then we know we are covering shipping costs.

I can't believe some of the unnecessarily complex shipping schemes I see on websites. Fixed cost makes it easy with telephone orders too.

6:53 am on July 23, 2005 (gmt 0)

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The problem I have with a flat rate is that some of the items we sell are very light weight and small. I don't want to put customers off by charging 7.
7:10 am on July 23, 2005 (gmt 0)

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Weight. Each item sends a weight along with other info to the shopping cart. The cart provides all the carrier rates.

Fixed cost makes it easy with telephone orders too.

We explain that shipping will be calculated when the order is packed. We can give them an estimate, based on experience. But in the end we weigh and charge accordingly. I am working on a local order system for telephone orders, and the rate charts for all the major carriers are available online, so that is getting added to the system. But still, the inventoried items need a weight for this to work.

FWIW, it was a PITA to set up all the weights. But it's a one time task.

3:33 am on July 25, 2005 (gmt 0)

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I have to agree that flat rate shipping is the best for customers. They do not have to go all the way through the shopping cart only to find out that the shipping cost is too high for them.

We have used a flat rate shipping for all our orders. One thing that was working for us is that our shipping charges are based on the each incremental pounds. ie, 1.5lb is the same rate as 2lbs. We figured out what the average weight of our orders and adjusted our flat rate accordingly.

Also, this method will also encourage customers to fill up their shopping cart. They know that paying shipping charges on a $10 item is the same as a $100 item.

 

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