Estimating shipping costs can be tricky. The last thing you want is to loose money because you didn’t realize it would cost so much to send your item but you also don’t want to overestimate and scare away customers during the checkout process by adding on a shipping fee which rivals the cost of the item. Here are some tips and tricks I have picked up along the way for estimating shipping costs.
1. Use Etsy’s shipping estimator tool!
This is a great add on Etsy provides and with a little extra attention you can get an accurate estimate on your shipping. One drawback to this tool is that you need the final destination postal code before you can use it. One trick I have picked up along the way is to wait until I have an order then box up a few of the heavier things I am curious about and act as though I am sending these items to the buyer (of course just back out once it comes time to purchase the label!) I am based on the east coast so whenever I get a West Coast order I take the time to test a few of my draft listing weights and see what it would cost to ship. After a while you will get pretty good at estimating this!
2. Think about your true shipping COST
If you’re thinking like a business shipping costs should not just cover your final postage fee but should atleast include the cost of your packaging (boxes, tissue paper, that cute washi tape you had to get to tape the tissue paper, bubble wrap for fragile items-this can be a significant expense if you’re buying it new!) and maybe even think about partially covering the costs of your printer (especially if you’ve bought a special postage printer), scale, labels etc. If you live far for the post office or the shipping service you use you may even consider the cost of gas into your total shipping costs.
3. Think like a buyer.
That said, the shipping fee you require does not have to perfectly reflect your shipping cost. You want to put as much of this cost as is reasonable to your customer and can always slip the difference into the cost of your item. NOTE: The shipping and taxes collected at checkout will not be included in any discount coupon you may be offering so if you regularly run % discount promotions be careful when you hide shipping costs in the price of your final item.
Unless you are dealing in large specialty items like furniture, you don’t want the cost of shipping to exceed (or even come close to) the cost of the item itself. Think about when you are purchasing an item online. If the item costs $8 then you get to the final checkout to pay and your bill is $16 you might think twice about confirming that payment. For example, If you suspect the shipping cost of your $8 item to be close to $8 think about pricing the item at $12 and lowering the cost of shipping to $4. That way the customer is going into the payment process already prepared to pay $12 and when they receive the $16 bill they are less likely to baulk and reconsider.
4. FREE SHIPPING
Its not always possible to competing against other services like amazon that offer free shipping, especially when you’re not getting the major shipping cost breaks the big companies get. FREE SHIPPING is a major perk however and is a great way to run a promotional sale. Be sure you have your items priced at such that you do not loose money when you run these promotions!