Getting Shipping Rates Right

Listing an item on eBay isn’t only about providing great photos and an accurate description; the cost of shipping is also an important factor for interested buyers. Buyers hate getting ‘ripped off’ by extortionate postage costs. There are three main ways to communicate to the buyer how much shipping will cost for an item.

Calculated shipping

This feature allows eBay do the calculations for you using the package weight and dimensions plus the buyer’s location to create a total shipping cost. eBay.com has integrated both UPS and USPS for accurate shipping rates. A handling charge can be included in the total cost.

The shipping cost is advertised directly to the buyer on the item page, providing personalised totals of the different shipping services available to them. It could be argued that many buyers prefer the transparency of eBay calculating the shipping cost instead of the seller.

An updated invoice can be sent to the buyer if the eBay calculated shipping costs are found to be incorrect by the seller. However in this event, consider whether it is worth absorbing the cost instead of passing it onto the buyer to avoid the transaction going sour.

Flat shipping costs

This option charges all buyers the same amount for shipping based on the seller’s own calculations and arguably allows sellers to retain the most control over shipping rates. eBay offers use of a Shipping Calculator to help sellers figure out shipping costs. The weight, type and dimensions of the item are needed for the calculation. The calculator includes a section for adding in handling costs.

Sellers should specify the exact shipping service they are using. Once a sale has been made, the seller should always use the exact service specified in the listing, as buyers have an expectation to get what they have paid for. As shipping costs can be a little hard to calculate ahead of time, sometimes it may be more expensive to send an item than first estimated (your packaged item may be one gram above a shipping threshold for example). Although this will eat in to your profit, sellers should still send the item via the agreed upon shipping method. Sending the item via a less expensive service, or going back to the buyer for more money can cause the transaction to go sour at this early stage. Sellers should see this as a learning experience and can adjust their future shipping rates accordingly.

Using the flat rate option does not affect shipping costs for items sold through eBay’s Global Shipping Program.

Free shipping

An alternative solution to calculating shipping rates is to avoid it altogether and simply offer free shipping. Most sellers who do this factor some, if not all, of the approximate shipping and handling costs into the price of the item if using flat rate shipping. eBay strongly encourages sellers to offer free shipping with various rewards for doing so. Offering free shipping isn’t necessarily the best option for every eBay seller however, as discussed elsewhere on the blog.

Combined shipping discounts

Some buyers may buy multiple items from you at a time and are likely to expect a discount for combined shipping. There are two ways to do so:

  • Set up the listing to offer a reduction automatically using the Combined Shipping Discounts feature – eBay will automatically calculate and total the new shipping amount. Listings with the Combined Shipping Discounts feature show the text “save on shipping” which could attract more buyers.
  • Send the buyer a combined invoice when all items have been purchased. The combined shipping total is added manually to the new invoice.

Don’t forget handling and packaging

Remember to add handling and packaging costs to your shipping rates if applicable. Boxes, padded envelopes, packing material, labels and tape all add up and should not charged for appropriately. There also may be pick-up and service fees from your chosen carrier.

The handling amount is combined with the shipping cost and shown as one total so buyers cannot see the exact breakdown. eBay advises that shipping and handling costs should be ‘reasonable’ and clearly specified in the listing to maintain good selling practices.

Other tips:

  • There are maximum shipping costs in certain categories, specifically the Books, DVDs & Movies, Music, and Video Games categories. For items in these categories, there has to be be a shipping option with a cost lower than the specified maximum, or calculated shipping costs must be used.
  • Always check what the competition is doing regarding shipping – if your items are not unique, it is important not to charge a lot more than other similar sellers or risk losing sales. If your shipping costs are dramatically different, consider explaining why in the listing information.
  • Consider purchasing shipping insurance to protect items from loss or damage and including the cost of this in your handling charges. On eBay.com, ShipCover insurance is available when a USPS shipping label is printed.
  • Never guess weights and dimensions – it could you a lot of money. Packing an item before listing it is a good way to maintain accurate shipping costs.
  • Always use the stated shipping service in the listing. Bad feedback is inevitable for sellers who choose a cheaper shipping option than the one paid for.

Do you use calculated, flat rate or free shipping in your eBay store? Or a combination of all three?