Offering Free Shipping On eBay: How Not To Lose Your Ass On It When Doing It

In this post, I would like to discuss the topic of free shipping on eBay. Personally, I prefer to use calculated shipping rather than offering free shipping, but I want to share with you some tips on how to ensure you don’t incur losses on shipping if you choose to offer free shipping.

Shipping costs are often one of the biggest expenses for online sellers. Sometimes, the cost of shipping can be higher than the actual cost of the product itself. This can make it challenging for online sellers to remain competitive, especially when compared to companies like Amazon that offer free shipping to Prime members, or when advised by “gurus” to offer free shipping to customers.

If you decide to offer free shipping, it is crucial to accurately estimate the shipping costs, considering the worst case scenario. For instance, I am located in Indiana and the farthest shipping zone for me is the coast of California up to Washington State, then I would include the shipping cost for that zone in my product price. It’s important to note that eBay charges a fee of about 15% on the total purchase amount so you may to adjust your product price to cover this fee. For example, if you sell a $20 item with $10 in item cost and $10 in shipping cost, you will pay a $1.50 fee on the $10 shipping cost, which means you may need to charge around $21.50 to cover the 15% fee on the free shipping part.

It’s also recommended to pre-package your items to accurately determine the size and weight of the package for calculating shipping costs. Although this may require extra effort, it can help you avoid surprises and accurately estimate the shipping costs. If you are unsure about the size or weight, it’s better to overestimate rather than underestimate. For example, if you think the box will be 8x8x8 inches and 10 pounds, you could calculate it as 10x10x10 inches and 12 pounds to avoid any potential discrepancies.

It’s important to understand that offering free shipping requires careful planning and consideration of worst case scenarios to avoid losing profits due to underestimated shipping costs. While some sellers claim that offering free shipping doesn’t significantly impact sales, it’s likely to depend on various factors such as the type of product being sold and the preferences of the buyer. In summary, if you choose to offer free shipping on eBay, ensure that you accurately estimate the shipping costs and account for the eBay fees to protect your profits, and be prepared to prepackage your items to determine accurate size and weight for shipping calculations.