One of the issues you will always need to keep a watchful eye on as a seller is the costs associated with packing and shipping the items you sell. While most people realize that there is the cost of the materials for packing the items, they often fail to take into account another 2 areas where costs can impact their bottom line: the cost of shipping the item through a carrier and the time involved.
Shipping Materials: Anyone who has taken a trip to their local stationery store knows that shipping material such as boxes, bubble wrap and tape can take a large slice out of your profit margin when purchasing everything new. While a small number of sellers try to pass these costs onto the buyers, you will also turn away a lot of potential bidders by doing this since it is not a common practice among auction sellers. One solution to reduce these costs is to find many of the packing materials you need for free.
The first place to go is the shipping companies themselves. Most offer free shipping materials for sending items a certain way. You can get free boxes, tape, etc from the post office which will be sent directly to your door. UPS.com and Fedex.com also offer certain shipping supplies for free.
If you need packing material not offered by the shipping companies, there are still other options. For boxes and wrapping material, visit some of your local area stores. Merchants that get in a large number of shipments with breakable items such gift, kitchen and stationary, and stores that do large volume selling such as drug and electronic stores are potential places to receive free packing supplies. The manufacturers will send the items to these stores in top quality boxes with plenty of packing material that is usually thrown away. Simply asking the store manager if you can have some of the discarded boxes and packing material will allow you to get much the shipping material you need at absolutely no cost. In fact, many of these stores will be happy to have you take the items away since it can lower the store’s disposal costs.
If you are a buyer as well as a seller, you can often reuse the boxes and packaging materials you receive. In fact, this is a great area to give you ideas on the best ways to pack your own items. Chances are that some items you receive from sellers will not be packed well. Take notice of those that are packed well and what makes the difference between the two. If you want repeat customers, your packing needs to be top quality. Customers remember when something arrives that hasn’t been packed well and are likely never to buy from that seller again.
Shipping Charges: While many sellers don’t give shipping charges much of a thought since it is the buyer who usually picks up this tab. Having low shipping prices, however, will attract and bring back buyers who come to your auctions making it worthwhile to search for the best shipping options and rates for your customers. If you only sell items on occasion, getting discounts directly from the shipping companies will be difficult. If you begin to sell in volume, however, most shipping companies offer discounts. You can check with the different shipping companies to see the types of discounts they offer.
Another possibility is to use your company’s shipping service. While you need to talk to the company shipping manager to see if this can be worked out, in many cases, it provides nice benefits for all involved. You will get to send your packages at the company volume rate which will be less expensive than you could get on your own, and your company may qualify for additional discounts with the added volume your packages provide.
Packing & Shipping Time: Another area that sellers usually don’t think about in terms of cost is the time involved in packing the merchandise. This, however, is an important factor since time spent packing could also be time spent listing more auctions. Working out a system to reduce the amount of time it takes to package and send items will result in more profit for you if it allows you to list more items for sale.
The first thing to do is designate a permanent area for wrapping. This area should have all the wrapping supplies within easy reach and be well organized. A table specifically dedicated to wrapping is ideal. If you have to go to the garage for boxes, a closet for paper and a desk for tape and labels, plus clear an area every time you need to wrap an item, you are wasting a lot of valuable time. The better organized you are, the more time you will have to work on other areas of your business.
Another option if you have kids is to pay them to wrap items for you. This has several benefits for you. It frees up your time so you can work on other areas of the business. The amount you pay can be designated as a substitute for an allowance and since you are paying them to wrap the packages for your business, you can deduct the costs as a business expense on your taxes (unlike with allowance). Finally, it gives your children an opportunity to earn extra money and at the same time learn a good work ethic.
If you ship through a company that offers a free pick up service, use it. Taking packages yourself to shipping companies and the post office can be time-consuming and again, spent in better ways. If you must go, make sure that you pack all your items and combine the trip into one instead of making several each day. By taking all these issues into consideration, you can reduce the costs involved with packing and shipping your items significantly which will ultimately mean more money in your pockets.