by Mike Gibson

Created on: April 02, 2009

As an eBay seller, should you offer FREE SHIPPING?

There is no such thing as free shipping it just means that you (the seller) pays shipping for a customer. Why would you want to do that? According to eBay the theory is that you will attract more customers to your item because people like free things. The second reason one that I actually agree with - is that sellers were making the shipping fees so ridiculously high to avoid paying final value fees on the actual selling price of the item that eBay was losing out on fees and customers were feeling ripped of or at least had their intelligence insulted. I'm all for fair shipping fees on a lot of my listings the shipping fee that I charge is actually LESS than the cost of shipping itself let alone the cost of my shipping supplies. I do however, try to get the shipping cost to cover the actual shipping.

What would be the advantage of offering "FREE" shipping? To draw more customers to your listing? NOT LIKELY! First of all, when experienced eBay buyers like myself look for an item, we click the option to "list items by price + shipping". Buyers don't really care how much the shipping cost is they just want the best total price. If a product is $10 with Free Shipping and another seller has the same product for $6 + $3 shipping, are you going to buy the first product just because of Free Shipping? ABSOLUTELY NOT! What about unexperienced eBay buyers? Do they fall for the Free Shipping logo? Probably not, more than likely they choose the option "list items lowest price first". This option doesn't take into account shipping costs so the seller who offers free shipping is usually going to start the item at a higher price to cover some of the shipping costs the seller who charges for shipping can start the price lower and will be listed ahead of the higher priced free shipping item. I consistently sell my products for a higher price than my competitors and I NEVER offer FREE SHIPPING!

So what is the bottom line on FREE SHIPPING? It screws the seller! Not only do we have to eat the cost of the shipping the shipping can end up costing the seller up to 15% more than the actual cost of shipping! If you don't charge for shipping you WHOLE total sell price is charged a Final Value Fee which ranges from 8%-15%. So if I would sell a book with FREE SHIPPING I would not only have to pay the typical $2.76 postage, $.24 envelope, but also an additional $.42 in fees for shipping that I have to pay anyway! Sell just 10 books a month and this is an additional $4.14 in fees sell 100 books a month (a lot of sellers do) and they are paying an additional $41.40 in unnecessary fees! Am I going to pay $5-$100 more a month in unnecessary fees just to get a few customers who don't know what they are doing to look at my listings? NO WAY!

Finally, customers understand that shipping is a necessary expense. How many late night infomercials have you seen where the shipping and handling for a stupid little item is $9.99? Then on top of that, it is a 4-6 week wait for delivery!? OUTRAGOUS! Even when I ship Media Mail, which is the slowest postage it would never take more than 2 weeks and often is much quicker than that! The bottom line.. If I charge $2.99 to ship a book and it gets to my customer in a week and in the condition I promised I think the customer is satisfied. And based on feedback from my customers, They are!

Sorry, eBay I'm not offering FREE SHIPPING!

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