I'd like to offer free shipping on 75$+ but can i do it?

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Canada Canada
Aaron vintage
Kudos: 50
Joined: Nov 25, 2018
I'd like to offer free shipping on 75$+ but can i do it?
25 Nov 2018
Hello everyone!
I'm new to the lucrative world of e-commerce and am launching my webiste very soon. Hoping to eventually quit my day job so im trying to get everything just right. I've been borderline obsessing over it and researching nin stop between shifts.
Anyways, to stay competitive, id like to offer conditional shipping on 75$+ orders. My overall profit margin is 31.9% so im looking for advice on wether it can be done? I know shipping isnt cheap and im willing to absorb some cost but as i said im looking to do this full time eventually. Slow and steady is my plan.
Ive read tons of literature on the subject but nothing too specific so i decided to come here. Any input on the matter is much appreciated and thanks in advance!
United States United States
dlefler
Kudos: 50
Joined: Apr 10, 2017
Re: I'd like to offer free shipping on 75$+ but can i do it?
30 Nov 2018
You need to learn about Shipping Templates, go to settings (upper right at the very top) in your sellercentral account and look for shipping settings. You are allowed 20 templates so you can create many different conditions and assign them to your products individually. You may want to offer free shipping on certain products but others a basic $ fee or...you get the point. There is an option: Price "Banded
Shipping rates are determined by the total amount of the order". We've never set up one like this so there might be other caveats. Good luck.
Canada Canada
Aaron vintage
Kudos: 50
Joined: Nov 25, 2018
Re: I'd like to offer free shipping on 75$+ but can i do it?
30 Nov 2018
@dlefler awesome! Thank you so much for the reply! Can you enlighten me on the sellercentral account? I haven't came across that in my leg work and research. But thanks again im actually going to research it now! May bug you again if thats alright?
United States United States
dlefler
Kudos: 50
Joined: Apr 10, 2017
Re: I'd like to offer free shipping on 75$+ but can i do it?
30 Nov 2018
I thought you were already an Amazon seller, my mistake. You would need to get an account with Amazon of course but as you can see around here everyone does. If you're trying to do this on your own web site then it would depend on your shopping cart. We use Magento and it's as easy as going to shipping settings and choosing the amount for free shipping under each carrier setup you use.
Canada Canada
Aaron vintage
Kudos: 50
Joined: Nov 25, 2018
Re: I'd like to offer free shipping on 75$+ but can i do it?
30 Nov 2018
@dlefler. I have already been reaching out to fulfillment companies to see my options, would you say FBA is the best? And if i may id like to ask about fees i can expect from 3PLs. They take care of my packaging as well so in my fee to them i can cut out my personal expense on packing materials? Trying to set my game plan for fulfillment ahead of time.

I currently use Shopify platform and i see how i can arrange setting for frew over 75, just need to make sure im not in the red for profit if i do offer. The cheapest i can seem to ship anything i offer is around 17 dollars which cuts majorly into my 31%. Canada seems to have much higher prices through the post office.
United States United States
dlefler
Kudos: 50
Joined: Apr 10, 2017
Re: I'd like to offer free shipping on 75$+ but can i do it?
30 Nov 2018
FBA is not a fulfillment per se but I guess you could call them that. There is a ton of info on selling on Amazon around that you should peruse. They're a monster which is why everyone is jumping on board with them. They take a gigantic cut but they have gigantic numbers our sites will never approach.

True fulfillment companies store your products and fulfill your orders from your web site, b2b etc. We do all of that ourselves so I have no idea on costs for that service.

Shipping costs are always a huge problem/cost for everyone trying to compete with Amazon and other sites that offer free shipping. We use USPS and FedEx Ground but shipping costs definitely adversely affects sales.
Canada Canada
Aaron vintage
Kudos: 50
Joined: Nov 25, 2018
Re: I'd like to offer free shipping on 75$+ but can i do it?
30 Nov 2018
@dlefler fantastic info thanks! I actually researched FBA and wasnt sure if it was for me yet. I will get back to looking into that. Just to clarify, if i sign for FBA i ship them my products and they store and ship them or youre saying they dont do that? And what would using them mean for my site? Is it better for ppl to purchase my products through Amazon than as opposed to my actual site? I am hoping to continue using my own methods but if the bottom line is better through them to help me get confditional free shipping then ill opt for them
United States United States
dlefler
Kudos: 50
Joined: Apr 10, 2017
Re: I'd like to offer free shipping on 75$+ but can i do it?
30 Nov 2018
FBA (Fulfilled By Amazonis where you send your product to Amazon, they sell your products and fulfill the orders. They take care of everything and you pay for that very handsomely.
The other way to deal with Amazon is FBM (Fullfilled BY Merchant) where you simply list your products on Amazon but when a sale comes in you fulfill it.
FBA is typically 80% of all Amazon sales compared to FBM so that's why most ecomm people go FBA. They have almost 50% of all online sales! Amazon is almost at a point where more people will be spending money online with Amazon, than with all other retailers — combined!!!
Keep your web site but seriously consider putting your merchandise in front of the largest market in the world. Just make sure you understand they take a very large percentage of your money and that works for your business. This site has many tools and sites you can use to check those numbers and learn about the monster that is AMAZON
Canada Canada
Aaron vintage
Kudos: 50
Joined: Nov 25, 2018
Re: I'd like to offer free shipping on 75$+ but can i do it?
30 Nov 2018
@Aaron vintage. Youve given me amazing info and lots to work with so thank you! Ill hit research road asap and see where i get. Going that route will rely on wether or not itll eat all of my 30% margin or not. Anyways thanks a million and i may have Some follow up qs on this thread so hope youre around!
United States United States
Karenhansen888
Kudos: 30
Joined: Dec 1, 2018
Re: I'd like to offer free shipping on 75$+ but can i do it?
1 Dec 2018
TY for this discussion as i am at the very same crossroads using Oberlo with Shopify. I have contacted support with both now numerous times as they nearly dictate that i offer free shipping. They have me thinking i am not fully thinking it through but on 5 orders i have lost money now on 2 orders because my shipping was more than my profit on the orders! They are encouraging me to read Dropshipping 101. They said i need to keep massaging my numbers to gain a balance of raising my price points so that the 'potential costs' are padded into my items costs so that i can offer free shipping on everything. on the transaction in which i made a 24% margin the other day, the person had ordered a quantity of 3, that made all my costs back but on the other 2, they had only ordered a quantity of 1. My first test order i had the shipping set up to calculate at the check out that allowed me a clear profit; but both dropshipper and shopify said over time and variation of who i am shipping to where in the world that calculate at the checkout would not work out but that if i padded my price per item that it would basically work itself out in the wash.

so thank you so much for this discussion, i shall be watching it eagerly. i nearly scolded one of the customer reps yesterday saying how could this be?

I think they are trying to make the entire process as automatic as possible really, which is something of course that i would want, but i am not in business to lose money. evidently their wisdom is lose some win some and in the scheme of things it will all work out. Not sure i want to do business like that. i could just use another dropshipper and then just stay in the usa. Sunrise pads the shipping into the store owners cost of the item and then too, tells the store owner they must offer free shipping also, but they will only ship to the lower 48 states usa. on both dropshippers settings panels, they allow a global markup figure and of course you can change individual pricing, though have not tried that with sunrise.

So for right now, my cart says free shipping on 1 to 100.00. Which brings up another question, do i check the price per weight, or price per price of items box? Seems to me price per weight...but they encouraged price per item....oh- i am like you only i am ready to lose my damn mind. Grateful to have gotten 5 sales now in just a few days but- this has to be profitable of course!

[Last edited: 1 Dec 2018]
United States United States
dlefler
Kudos: 50
Joined: Apr 10, 2017
Re: I'd like to offer free shipping on 75$+ but can i do it?
3 Dec 2018
First off, we don't have a dropship model here so any opinions I have of that model are my own.

Of course your fulfillment company wants you to sell it with free shipping, stats bear it out, you'll sell more that way and that's exactly what they want, they're making money regardless if you are or not. You can either raise your prices or charge for shipping or do both. With middlemen, like fulfillment centers, dropshippers etc. you have less margin to deal with, it's basic business.

We refuse to give away shipping, it costs us in volume but in the long run we're still in business and growing. We have customers complain about our shipping costs but those rates are live quotes of exactly what it costs us to ship, how could we sell something for $12.99 and ship it for free when the shipping actually costs $13.56? We can't compete at the free level so we don't even try. Our products are the reason we can charge for shipping, they are ours, they are unique. If you're selling something dozens or hundreds of other stores are selling then your options are limited.

Who fixes your shipping costs with fulfillment centers? Have you checked them to make sure they are not being padded. How about raising prices a bit and offering flat rate shipping, you'll lose on some shipments but the increased prices offset that to a degree. You'll have to massage the numbers or realize that drop shipping is not the easy money the wholesalers want you to believe.
United States United States
Karenhansen888
Kudos: 30
Joined: Dec 1, 2018
Re: I'd like to offer free shipping on 75$+ but can i do it?
3 Dec 2018
@dlefler

Spot on. For now, I have begun taking their advice to pad my pricing and dont you know sales have stopped. I see the same products from similar wholesalers all over eBay. And building a nice ambience on both Ebay Amazon and Facebook seems a real challenge so that I'd rather get traffic to my Shopify site.

I am also looking into combining affiliate programs with my store.

Looks like I need to reconsider my products and indeed entertain whether the dropship model will work for me. Thank you.

Avalara
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Thompson & Holt