Free Postage vs Charging for delivery

[catboxes]

Hi

I've recently changed my eBay account over to a business account (what a nightmare!)

I've been happily selling away over the past couple of years, and I ALWAYS offered free postage as I think it makes the item more attractive.

But now that I have to accept returns, I don't think I can justify offering free postage anymore because if someone returns something (for a change of mind), I can't claim back what it costs me to send it out in the first place.

What are people's thoughts on free postage vs charging for postage? If I charge for postage, I will be reducing the cost of the item accordingly, but I'm worried I won't attract buyers if I don't offer free postage. Is offering free postage more attractive to buyers, or is that not really a factor, and they go by the overall cost? Does anyone have any advice on which is the best option?

Helen x

[ducatimondo]

It depends on a lot of factors.

Yes, buyers are swayed by free delivery, I certainly look for items that have that as an option, even though I know it is usually factored into the price.

Are you looking to achieve or TRS and offer the premium service extras that will get you the TRS discount on FVF's?
If so, then may be wise to look at free delivery from the get go, or otherwise you have need to edit it all again later.

We offer a free delivery option on all of our items across 2 different shops.

I can understand the frustration of needing to refund in full if you get a return, but I think it stops a potential deal breaker in the checkout when buyers are in the process of ordering.

I suppose it also depends on how many items you get returned too.

If you were doing clothing where sizing can cause issues, then I would imagine they get high returns volumes, whereas other items rarely get returned.

[catboxes]

Hi

Thanks for replying!

Unfortunately, I don't know yet what volume of returns I'm going to get as I didn't offer returns for a 'change of mind' when it was a personal account. I sell a lot of things that require the buyer to read the description, so I'm expecting my returns to go up once they realise they can return (because if they haven't read my description, I think a lot of people up until now will have accepted their mistake but now I have to offer returns their mistake is going to become my problem, if that makes sense?)

I was going to go for TRS, but then, looking at the benefits, the 10% off fees don't really offset the postage costs, and I've been doing well enough without worrying about the badge. So wasn't going to worry too much about that.

I always look for free postage as well, which is what makes me think that's what buyers want, but I sell a lot of £9.99 items, so by the time I've sent that out which costs me £2.99. Then, to get it back and try and resell it and pay that out again and again, the item becomes worthless.

Ahhh I'm sitting here on an endless back-and-forth loop in my head on what to do lol I've been avoiding up until now making any edits on the live listings as they are currently retaining the no return setting, but as soon as I make an edit it forces me to change that so I can't bury my head in the sand for much longer 

Helen x

[magpiecorner1]

Six and two threes if you add the postage charge to the item costs when giving free postage (and you would be mad not to!)  If you sell something for £90 and £9 postage or £99 with free postage, that is the amount you give back to the buyer.  And whatever the item costs you to send, you can't claim back outgoing postage.

There is an advantage to offering free postage, the 10% discount on fees. 

We've periodically worked with free postage on a couple of business accounts and had one with free postage on all 1500+ items for about 12 years.  A couple of months ago, we changed over to charging for postage, because these days eBay is a cack handed with estimated delivery dates, and it has become harder to stay under the defect percentages.   Hasn't resulted in a drop in sales.  We still combine postage.

[catboxes]

HI

Thanks for replying!

I thought when returning something under the 'change of mind' option the buyer isn't entitled to the original postage costs back. So from your example above, if they paid £90 + £9 postage they would only get a refund of £90? Am I wrong in thinking this? If I am, I may as well stick to the free postage?

Yes, my items include the postage cost, so that's why I was thinking I could reduce all my prices by the amount I was going to charge for postage.

So you've not seen charging postage make any difference to your sales?

Helen x

[4_bathrooms]

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@catboxes wrote:

But now that I have to accept returns, I don't think I can justify offering free postage anymore because if someone returns something (for a change of mind), I can't claim back what it costs me to send it out in the first place.

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You can't reclaim the outgoing postage cost from the buyer's refund even if you charge for shipping. The law states you must refund the basic outgoing shipping cost if the buyer wants to return for remorse reasons. So, if your basic shipping charge is £4.00 but you offer a next-day service for £10.00 you would still have to refund the £4.00 basic shipping charge if the buyer had paid for the enhanced shipping then returned for remorse reasons. 

However, eBay insists business sellers refund the full outgoing shipping cost if the buyer returns for remorse reasons. In the above example eBay would require you to refund the full £10.00; when you sell on eBay you offer your buyers more rights than they have enshrined in law.

Note that if a buyer opens an Item Not As Described (INAD) case you are responsible for refunding the outgoing shipping in full and paying for the return shipping (unless you offer free returns).

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@catboxes wrote:

What are people's thoughts on free postage vs charging for postage?

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Most people are smart enough to realise that "free" shipping isn't really free. £25.00 + £4.99 shipping is exactly the same as £29.99 including "free" shipping. Offering free shipping means your listings will appear in the search results if a buyer selects the "Free P&P" filter when searching. However, if your buyers are likely to purchase from more than one of your listings in a single transaction offering "free" shipping complicates offering discounted postage for the purchased items.   
  

[susapric-68]

It's not all bad news about having to take returns,as a business seller now you now have the right to get them back in the condition you sent them and if not you can deduct upto 50% from the refund

[fatbobfan]

I think it depends on your inventory

As mentioned clothing may have a high return rate for sizing and there are probably others categories I am not aware with simialr sort of returns request

We get a 2 maybe 3 a year (small parcels) , its annoying but take it as part of online selling, £10 a year, not a bad hit. 

Can give your potential customers confidence, always mention it in discussions with messaging, it reassures them of their purchase, if their is any issue its a free returns process. 

TRS discount as well, guessing it will tick the Ebay algorythm boxes (who knows) 

Perhaps take a look at your selling history and unhappy customers? If they are few and far between you should be OK

If your inventory and listings are quality it should'nt be an issue.

[floral.lines.supplies]

There's no such thing as freepost! Freepost means the postage costs have been calculated into the cost of item. Don't forget to add extra for the small% fee and correctly calculate the full cost if you offer 1st class.

Returns ;

Some returns are charged to your account and some will be paid by the buyer....depends on the box they've ticked.

[the-nutwood-collection]

If you Google 'Does offering free shipping increase sales' you'll find a number of interesting articles on the subject.

Sometimes (and I don't think this will apply to you), not offering free shipping can increase the basket size.  For example, I buy craft materials.  If the shipping is a flat price, then I have a tendency to browse the site to see if there's anything else I need/want and therefore get 'better value' for my shipping charge.  If it's freepost and all I want is a couple of spools of thread, I just order them.  If I want another couple in a week's time, I order again.  Freepost doesn't give the buyer the incentive to think ahead and order all they're likely to need. 

I ordered a couple of packs of charity Christmas cards.  The shipping was £4.99.  I browsed, and added sweeties and stocking fillers - I'm easily suckered into increasing the basket. 

[catboxes]

HI

Thanks, everyone, I hadn't realised that you had to refund the original postage cost (if this is charged for and not free) when refunding someone for a change of mind, so it makes my thought process a bit moo (a cow's opinion) lol

Thank you all for your help, though; I really appreciate it!

Helen  x

[catboxes]

That's very true and is something I do as well, so I hadn't thought of that from a selling point of view! Thank you x

[insidethe93]

In case you haven't already thought of it, may I suggest offering:

1. Free shipping, and

2. Option(s) automatically offered at check-out to upgrade to, say, 1st Class post/48-hour tracked, 24-hour tracked. Obviously with the extra amounts stated.

At times when I'm shopping recreationally, if a seller offers free postage on most or all items I'm more likely to look through their shop and buy more. If I have to ask for combined postage I don't like waiting, and I have to plan ahead a bit to make sure I'm around to pay promptly when the new invoice comes in, and generally I don't like to "make a fuss" as it means the seller has to do something. The time spent between buyer and seller (which could be a day or so) is time otherwise time the item could be being processed or even already despatched.

The advantage of points 1 and 2 above is that buyers can't then moan at shipping delays (well, there's always one or two buyers who'll moan anyway).

Sellers tend to assume people want the cheapest shipping but that's not always so!

Having options automatically at check-out means hopefully reduced buyer queries about shipping.

Another advantage is that it covers busy times such as the run-up to Christmas, or even just a buyer's need/wish, depending on what the item is plus you don't know what's going on in people's lives.

I tend to gravitate towards sellers who offer faster shipping options AUTOMATICALLY AT CHECK-OUT. Friends and colleagues who also use eBay tell me they seem to do the same especially at Christmas.

[tornari-group]

We've covered both options! All our eBay listings are free delivery, with multi-buy discount set at 10-15%. Our WS has lower prices but a blanket £3.99 delivery charge regardless of order value. Both methods are successful, but we have noticed WS orders tend to be larger - buyers are searching the shop to add items, knowing there will be no increase in postage charge. Both work. eBay brings in a good rate of orders, mainly single items.

Choose which way you want to go and run with it for a few weeks. You could always change it around later on. Good luck.

[alpr8027]

Furthermore regarding returning the outgoing postage for remorse returns, if you offer postage upgrades, for example express/ special delivery, it has always been my understading eBay will insist you also have to return the full postage cost including any extra payment received for the upgrade to get a refund on the FVF.

[sheba-knows-best]

In my opinion it's to do with workload.

I think an awful lot of people still go for the cheapest price and ignore the postage on top. So - it's just my opinion - but I think most people still go for the £25 coat with £4.99 postage, rather than the £29.99 coat. The reason I think this, is all of my mates all rave about their 'bargains' and never think to mention the postage.

Having said that - I offer free postage to simplify things. It stops people constantly messaging offering to buy a few, if I give them a good postage deal, but I know full well they're really using the service to try two or three, keep their favourite, and end up with almost free postage for my efforts after I've refunded on the combined parcel (and combined refunds aren't always as expected either).

In contrast - if I offer free postage - any postage saving is mine. Although sometimes - if the buyer doesn't look squeaky clean, I still post separately to stop the 'there was only one item in the parcel' scam.

Returns in clothing are high. Mine is at 12%.

[fatbobfan]

Forgot to mention International Shipping, 

If you as the seller offer International service and dont take the UK postage rate into the equation, you can make a little extra there as well,

All helps