Offering free shipping on your eBay items may place your listings higher in Best Match, but this comes at a cost. Of course, any business person knows that you aren't shipping the item for free, you are incorporating the shipping fee into the asking price of your item. But, remember that your final value fees are figured on the sale price of the item, so the higher your sale price, the more fees you will pay. Here is an example of how offering free shipping will cost you money.
Let's say you are selling a large or heavy item that costs around $20 to ship. If you offer free shipping and build that $20 cost into your asking price and offer this item on a fixed price listing, it is costing you $2.40 in fees. (Based on 12% final value fees.)If this is a stock item that you sell many times a month, you can see how that fee will add up over time.
So, the free shipping option is really a catch 22. Do you offer free shipping at a cost to appear higher in Best Match? Or do you not offer free shipping to save on fees and settle for appearing lower in Best Match? What do you think?
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Happy Selling!
I have also heard that offering free shipping actually can lower your DSRs, as buyers don't think it's worth a 5 for some reason. I seldom offer it.
ReplyDeleteIt's a catch 22 situation. I don't offer free shipping because I sell glassware which is heavy. I keep my prices very low and don't charge a handling fee. I don't think it's fair to place free shipping items higher in the search. The customer is still paying for the shipping, but are beind deceived.
ReplyDeleteI don't like using free shipping. We do it on a few items, but I just don't think it's the best way to go. It is good for people that aren't good at math. Other disadvantages are that you will not get many, if any international sales, because they will have to pay the full price with shipping built in, plus the cost of international shipping. I would say that about 20% of our sales are international, so that would be a big loss. Another disadvantage is that customers don't have the incentive to order more than one item, because with normal shipping you give them a discount on shipping. Last Monday, we shipped 45 packages, but sold 52 items, so 6 or 7 of those 45 customers ordered more than one item, and I am sure some of them were because of the shipping discount. There are ways around these things, but it is easier to use the shipping calculator. We have about 15,000 sales on eBay now, and have tried many different things, and that is what works best for us.
ReplyDeleteI agree with both Suzanne and Chris. I offer free shipping to attract traffic to more expensive items; however, I am getting away from free shipping as well. It eats into profits big time, and if a person is going to buy online, they expect to pay shipping.
ReplyDeleteWhat I do sometimes is throw in Del Conf and insurance at my expense, and inform the buyer I am doing that.
Personally, i think eBay once again do not care about any damage that can arise to your business through these kind of issues!
ReplyDeleteI mean if a seller is paying the shipping to grab the buyer and please eBay you are the only one losing un less you are selling high ticket items?
Thats why some sellers in certain markets only use eBay as a sales funnel for back end sales from their websites, to combat the costs and make more profits!
Great post Suzanne love this blog....Ed.