Shipping charges effect on customers buying

[janeread]

thanks for all these responses - it's very clear from what everyone has said that there isn't one answer - not the answer I hoped for, but good to have the information anyway, so thanks a lot


Jane

[parklifeclothes]

We currently have selected brands where we gave built the postage costs into the product price and it works out pretty well, but we lose out big time when we get returns/exchanges, whereas we have to refund the total paid, even though we have maybe paid £3/4 to send it, also now and again when someone buys 2/3 items to compare we really get hit as we will maybe spend £6/7 and eventually only sell one of the three products when they have decided what one fits/suits.
Currently looking at minimum spends to qualify for free p&p and also the pro's/con's of set charge per item.

[TraceyHand]

Darron
Those are the exact reasons we eventually abandoned free shipping.
Doesn't help that clothing can be heavy and it's probably one of the most likely things to be returned.

[parklifeclothes]

The other problem we find with free shipping is the demands people then impose. Wanting to know where their order is if it doesn't arrive next day.
The other idea we are looking at is something like Amazon's 'super saver' option, that allows Amazon to ship out in bulk and by far slower methods. We would probably be able to do this by processing orders using this option once a week and therefore freeing up more time in the rest of the week to service 'paid' p&p orders and spend more time working on the site.

[TraceyHand]

hmmm...
Offer a standard shipping rate and give customers the option of downgrading to a cheaper, slower service...rather than offering a cheap rate.

interesting..

[parklifeclothes]

Not quite sure I worded it right, I've confused meself now!!!

[janeread]

hmmm...
Offer a standard shipping rate and give customers the option of downgrading to a cheaper, slower service...rather than offering a cheap rate.

interesting..

does anybody do this, because this is an option I hadn't thought of ..

[Duncan Rounding]

Amazon market this the other way around - free shipping (within I think 5 working days) or 'normal' shipping at the standard rate. They cleverly make standard shipping the default at the checkout though.

In actual fact I usually buy with the free shipping and still receive my goods within a couple of days - just as fast as I would expect the standard shipping time to be.

Interestingly we offer free shipping over £50 on fancylines and very few people actually add goods to take the purchase over the threshold - most sales are a little below and with shipping added on come to almost the threshold itself - so in that line of goods shipping prices may not be the deciding factor.

At the moment we only offer standard shipping which is first class post but are considering making second class post the 'standard' and offering first class as an additional price adder. Not to make money on the faster shipping but to save money on the majority of shipments.

[TraceyHand]

At the moment we only offer standard shipping which is first class post but are considering making second class post the 'standard' and offering first class as an additional price adder. Not to make money on the faster shipping but to save money on the majority of shipments.

Interestingly, this is exactly the opposite of what I have just done!

I used to do second class as standard...with an optional "upgrade" to first class for an additional £1 (which more than covers the cost difference)
However, I became increasingly unsettled for several reasons
a) goods take too long to reach the customer (IMO)
b) At the tariff I was using, I was not covering costs on the majority of the "second class" parcels
I knew I needed to overhaul my postage rates and decided to eliminate the second class rate altogether. I now only offer the first clas rate at the same price it was before.

Main advantages (compared to before) being..
1) most orders go out "same day" and can potentially arrive next day...good customer service leading to recommendations etc.. and
2) no more sorting into first and second class mail. It's all going first class!

It's quicker, easier, better for the customer who can potentially get their order "next day" and, perhaps most importantly, no drop in orders and I'm covering my P+P costs now!

I waffled, sorry.. just sharing. (I'm that kinda gal lol)

[Duncan Rounding]

Thanks for that Tracey - more food for thought - I'm not going to rush and change it. The reason we offer first class right now are exactly the reasons you mention.

[Stereo Steve]

I've put a lot of thought into this and looked at what the big sites do. Now, most of my competitors do next day for £5.95 plus vat via city link. We tried the same and we tried a bit cheaper but found that the average order in our business is around £25 and we were making a couple quid per order. If they want to do that, that's fine, but I don't. So, I sought to differentiate myself.

We have put up our product prices and offer 2 shipping bands. We have economy courier(1-4 days) at £5.99 and next day for £6.99. Effectively we use the same service but the economy option gives us more time to dispatch.

If you spend over £50 you get free economy shipping and next day for £2.99. If you spend over £75, both are free.

This way, we make more on the small orders as our prices have risen but people do get a good deal if they spend £50. We still make a good profit either way. Many people will linp over the £50 to get the free shipping which is fine by us but we do make a lot more on a £35 order than a £50 one.

The main thing is that we have a marketing tool that is within reach of most punters plus we make a far higher average profit per order than before. On top of that, it's really working and orders are growing fast.

I must admit, I do plan to build another site offering free delivery on everything, just to see if it takes off. Most of our goods are heavy and low value though so it's not ideal but I would be intrigued to see how it went. I guess there is a part of the market that would love it.

Downsides are price comparison sites where you don't look so good but I feel it's been a real winner for us.

[Stereo Steve]

I would also point you at Ebuyer who do free for super saver (still city link) but charge a huge premium (£7 odd) for next day. I have used both, depending on the need. I think this is a great idea and must make them great margins.

[george]

I must admit, I do plan to build another site offering free delivery on everything, just to see if it takes off.

Watch this space Steve.

[TraceyHand]

Watch this space Steve.

*books front row seats to watch G's space*

[pinbrook]

At surf-wax we do not offer a choice, it all goes first class or parcel force, we say in T&C please allow up to 5 days for delivery, and contact us if it doesn't arrive after 10.

We chose to do this, as it covers us for when an item is out of stock, we can get stuff into stock quite quickly, (but with 600 DVD titles we can often be missing the odd DVD that only gets ordered once a year) but it means for the majority of orders we promise low and more often than not deliver high.

I reckon we get 4 emails a year asking for Next Day, and have never had any one ask why we don't offer a choice.

Its all shipped by weight at about 10% over value of stamps, to cover jiffy bags. I prefer costing shipping by weight as it helps with costing where looking at overall shop profitabilty. Customers like it (no-one has ever commented about cost).

We movedfrom "free" postage a couple of years ago as our prices looked to high on price comparison sites and SERPs, number of orders at the time did not change.