I just saw a headlamp on steep and cheap and the shipping was $8.50. For a headlamp! WHY!?!?!!? I might as well go into REI and buy it now. I see this crap all the time.

Box, label, storage space, a person to box it up, profit and the fact that postal rates went up again.

Suppose the headlamp is just a few miles away, in my case, say SF.

Gas+bridge > $8

Cheaper for me to ship it than to go get it.

Closet REI 125 miles.

I feel your pain, but we routinely see worse. A $35 item, not heavy or bulky with $40 shipping is a rule out for me. Some companies say, "We have to ship UPS (which only offers Second-day Air to Alaska, no surface shipping)." and I think, "There's no post office in your town? The postal carrier doesn't come to your business every day like they do to mine?!?"

Some businesses may agree to ship everything UPS for a slightly better rate, or simply go with one shipper for simplicity. GoLite is in that category.

Sierra Trading Post and REI both offer a range of shipping options.

Ideally shipping should only be what it actually costs to ship the item. Labeling, storing, boxing, profit etc. should be part of the pre shipping price. Adding all that on to shipping is clever, as a lot of people don't look close enough. This is becoming a more widespread custom and while it is legit if disclosed, I am not a fan. I tend to avoid companies or individuals that make their profit off of shipping.

I worked for one form that did a lot of online sales and the owner had the idea that he was going to break even or better on shipping. He was dreaming.

Unfortunately boxes and packing materials really add up. Expenses can be crushing to a small business that lacks the purchasing power and effeciency of a larger firm. Priority Mail can help solve the box problem, but many businesses want the paperwork to be simple and just use one shipping vendor and UPS usually wins there. If you have a web site, programming all the shipping correctly is a big task. They need to evaluate every item for volume, weight and fragility. My guess is that bottoms out at some point and all those little items go at a minimum with sales emphasis going to higher dollar/volume items. So a big backpack goes free while trekking pole baskets get a shipping charge that is 100% of the cost of the item. That is frustrating for the consumer who knows that it would cost $2 to ship.

For users here, with smaller items under 13oz total, First Class Parcel is the way to go. Priority Mail is good for smaller items under a cubic foot. Larger stuff like packs can go Parcel Select. From there it is UPS or FedEx Ground. BTW, Office Depot seems to have better rates for UPS.

I'm a ceramic artist and ship pottery to people.
I've been seriously burned on some recent sales due to shipping costs that were far higher than what I estimated when I quoted a job.
It can really kill a sale when you're selling a hand-thrown coffee mug or set of bowls for $12 a piece but to ship four of them costs $28. What customer wants to pay that? And if I absorb the cost, I'm making a pittance for the work when you factor in time and materials.

I recently purchased a bowl from one of my favorite English potters. $18 US for the bowl, $22 US for the shipping.

Such is life.

I've had some luck with smaller companies keeping shipping costs down. E.g. I'll call and point out that they can just put the item in a manila envelope and ship it first class for a dollar or two, rather than charge many times that according to their shipping chart. Sometimes they agree, particularly if you shop there regularly. Give it a try, you might get lucky...

Another of the hidden secrets has to do with UPS shipping fees. Let's say that the customer orders an item for $100, and the seller offers to ship it via UPS. They look up the UPS fee based on the address and weight, and let's say that it is $10. So, the customer is billed $110 and the item ships.

Then later, UPS credits the seller for a secret amount of money. That varies from one company to another, and it depends on what has been negotiated. The kickback is on the order of 10-20%.

If the buyer were big enough, he might have his own UPS account. Then he can order the item and supply his own UPS account number to the seller. That way, he pays the seller $100 and he pays UPS the real rate, whatever it is.

--B.G.--

here is an Aussie example.
I sent a tube of silicone to an Aussie customer.
$5.40, and that is the cheapest possible postage for this 3 oz item.
To make sure it would get there I would have to pay another $3.20 for signature at the other end.
As it happens, the Post Office put the stamps on the "sender "side (clearly market "sender") so the parcel went to the Post Office at the other end and then came back to me...

Edited by Franco on 02/14/2013 13:40:48 MST.

I'll go out on a limb and guess most of you haven't worked in shipping. I cut my teeth working for an importer who sold online - and we nearly always lost on postage.

Here is how it worked for us:
I showed up at the warehouse in the morning, my boss had the orders printed out from 4 pm the day before to whenever I came on. I would divide the orders up into categories - type or order and how they were to be shipped.
Then I would pack all the small orders - which took time I might ad, no matter how small. To say that it is easy, well that isn't true. You are always thinking "How can I ship for the cheapest, yet have tracking?" To keep down cost, when we shipped Postal we only used USPS packing materials. Boxes, padding and envelopes are not cheap. Then the packer has to get labels done, on and ready to go.
The big orders involve packing, thinking and making sure nothing will be broken. And so on. I was not only the packer, I ran the phone lines, ran the warehouse and dealt with anything thrown at me - so going outside my normal ways meant I had to stop and use more time up. And...time goes fast. And you are looking at USPS showing up at 3 pm and UPS at 4....not a lot of time. The special need orders always got bumped to last for that reason.

Not every business has mail pickup daily. Many have to go to the post office to do this, which yes, cost time. And time is money.
We had one point where the postal person refused to pick up our mail, due to it filling their jeep. They also hated that most of our flat rate boxes were filled with granite mortar and pestles...hehheh. Those puppies weighed 15 to 30 lbs each ;-)Same driver ran his jeep into our warehouse door one day in anger...sheesh.

Most folks expected UPS delivery. We'd ship Alaska and HI orders via mail - and they were NEVER cheap unless one could get it into a flat rate box. Same with International and military orders. Military/International orders were never fun, customs forms and so on. Ate up more time - and had to be packed super tight. I always saved up the orders and shipped once a week for those.

So look at it this way: I hate having high shipping charges for my own business, so I try to keep them in line. But....an international order to say New Zealand? I can drop $15 to 30 without blinking. I have to charge what it will cost me. I hate charging $10 to ship one book, but it does cost $7 to 10 to do that for many countries + padded envelope + bag + my time to go to the post office. In the US I charge $3.50 for a book to be shipped. I HATE Media Mail so won't use it - any postal worker can open the package!! It cost about $2 to 2.50 to ship + materials. A padded envelope runs 25 to 50 cents each - but the person also gets first class with tracking. If someone pays in for the next level, I often ship Priority so they get it faster.

You win a few, lose on most. And no, the shipping charges are NEVER worked into the cost of the product, unless you are a mega company like Amazon. Smaller companies pay the going rate (the UPS discount mentioned by another poster is based on how many packages you ship a week, you have to really be pumping out orders to get a good one).