The High Price of Free Shipping

Knowledge Base -

The High Price of Free Shipping

Many shoppers are coming to expect free or reduced price flat rate shipping from online stores, but how many shoppers know how online retailers are accomplishing this?  In truth, it is more expensive to ship packages in the US than most of us realize.  Online stores that offer free shipping or free returns use one of two strategies. 

Many just raise the price of the item, for example, if they would have sold the item for $45 plus shipping, and shipping typically costs them $12, they sell the item for $67.  We can't really take advantage of this strategy because all of our items are hand-crafted in the USA. That means the cost of our labor (the wages we pay our workers) is 25%-588% higher than the cost to use foreign labor or robotic automation.  If our prices are already 25%-588% higher than cheap import goods, you can imagine how customers would feel if we tacked another $12-$24 on to the price. Instead, we prefer to be transparent about how much shipping really costs.

The other strategy that many large online retailers use to "pay for" the cost of free shipping or free returns is to sell something else in addition to the product you are purchasing. But they aren't selling it to you.  Many online retailers make money selling customer data or selling advertising, and this is how they are able to offer free shipping or free returns, even if they end up losing money on the sale.  We don't sell your information, and we don't host advertisements on our website.

Finally, our shipping rates may seem high because customers expect the weight of our product to be similar to other cushions they have purchased before.  Latex foam fill lasts years longer than other foam or polyester fiber fill, but it is heavier to ship.  Many of our items are also classified as "oversized" by the shipping carriers, which is heavier to ship than smaller items such as books, clothes or shoes.   Because our cushions last years longer than the competition we feel that they are worth the investment, and thousands of our customers agree.  

Our shipping rates are based on the actual cost to ship a package by weight and size to your zip code via UPS Ground or USPS Priority mail.  We do try to absorb some of the cost of shipping, but as a small Made in USA business with a low profit margin, we don't have much room to absorb additional costs; and since we do not sell anything other than latex foam cushions and textile home decor, we do not have another source of revenue to offset the losses from absorbing shipping costs for the customer.  We hope to someday grow big enough to offer reduced price shipping. By leaving an honest review of our purchase and sharing word about us with your friends and family you can help us grow.

NEW YORK TIMES: Amazon Knows What You Buy. And It's Building A Big Ad Business From It.


Leave a comment

Please note, comments must be approved before they are published