How Will Sellers Deal with Postal Rate Changes?

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Ina Steiner

AuctionBytes Blog
News and insight focusing on
ecommerce and the online auction industry
by Ina Steiner, Editor of AuctionBytes.com

March 31, 2007

How Will Sellers Deal with Postal Rate Changes?

By:

Sat Mar 31 2007 20:23:25

New postage rates go into effect on May 14, 2007, in the United States. What are your strategies for coping with the changes? Fill out our survey (which goes live late Saturday night) and then post your comments below. We'll be publishing the survey results in a future issue.

Comments (44) | Permalink

Readers Comments

How Will Sellers Deal with Postal Rate Changes?

Sat Mar 31 23:08:39 2007

This is ridiculous. Service has plummeted over the last two years with more and more packages missing or damaged, and often inexplicably slow delivery times. I guess I'll start using Fed Ex a lot more.

How Will Sellers Deal with Postal Rate Changes?

by: Terry

Sat Mar 31 23:55:22 2007

Will have to watch what we charge for postage. Think the buyers are going to be the ones that will be getting screwed. As a buyer, I will be more careful and watch the shipping costs.
What is more amazing to me is not that USPS is rating their rates, its that FedEx, DHL, & UPS all raised their rates by as much as 30% AND added a fuel surchage on top, and noboby seems to care!

How Will Sellers Deal with Postal Rate Changes?

by: Mcnerd

Sun Apr 1 00:04:36 2007

Interesting previous comment. I've seen a marked improvement in the USPS service since the last couple rate increases and less reports/claims for missing or damaged packages. Delivery times are fast and predictable, which pleases the customer.

Of course I don't like this latest set of increases. The increase gets passed on to the customer, just like any other costs of business.

How Will Sellers Deal with Postal Rate Changes?

by: Jo

Sun Apr 1 02:00:50 2007

I have found that comparing rates between USPS and Fedex Ground save me and my customers money. Just going to have to do more of that in the future.

How Will Sellers Deal with Postal Rate Changes?

by: Cliff

Sun Apr 1 02:31:59 2007

I just hope eBay doesn't debut their new feedback 2.0 around the same time -- buyers who aren't aware of the USPS rate increase may rip into sellers for overcharging on shipping when they're only applying the new rates.

I also hope eBay can handle the bulk load of edits/File Exchange/etc. taking place around the 14th. I don't foresee any problems on my own site where I use a flat rate and can just adjust it accordingly.

I think the USPS service probably varies throughout the country. I know by me here on Long Island they've been using some new metering machines which have absolutely been butchering any non-flat packages that I receive. I've been forced to pay what I more or less see as protection money (insurance!) to make sure everything gets to me in one piece. No complaints from the customers though, though I ship mostly flats.

How Will Sellers Deal with Postal Rate Changes?

by: Michelle

Sun Apr 1 06:52:52 2007

I have pulled all but a couple of dozen listings off of Amazon over the past year because the piddling amount they give a seller for shipping already in no way reflected the reality of shipping costs for anything that weighed more than a pound. You can't sell something above market there in any sort of attempt to break even on shipping. Someone will always undercut you by a penny and that will continue to happen until the price of an item drops below your cost to even acquire it. If Amazon does not drastically alter what it pays sellers for shipping, most of the 3rd party sellers they have with the exception of the folks with high dollar inventory, will be gone in a few months.

On eBay I list and sell a lot more media items. I typically charge the same for like items as my competitors and less for shipping. I rarely lose money on shipping and often make .25 - 1.00 after costs of materials even though I am undercutting them (sometimes drastically). I'll have to raise my charges a bit. It probably still won't put me where many of them already are. If they raise their rates too, I see even more business coming my way.

How Will Sellers Deal with Postal Rate Changes?

Sun Apr 1 11:53:30 2007

why don't you all grow up, rate going up is just a fact of life,the real problem is gas ,the deliver trucks don't run on air.if you stop and think .40 to get a letter from ny to ca. is very little , a package from ny to ca. in 2 days for under 5.00 try driving it there,get over it and just move on life has bigger and better issues,let be honest if you see something on the innernet you want will you realy pass on it because shipping is 10 cents more think about it ???

How Will Sellers Deal with Postal Rate Changes?

by: Ina

Sun Apr 1 13:07:10 2007

A reader in the UK points out postal rates are increasing there as well:
http://www.royalmail.com/portal/rm/content1?catId=400147&medi
aId=41500683

How Will Sellers Deal with Postal Rate Changes?

by: Paul

Sun Apr 1 13:15:55 2007

I think the effect will be minimal except for low-value, light-weight parcels which will be hit with big increases. Overall I am happy with USPS with most packages I send from Seattle reaching the east coast in 2 to 3 days.

How Will Sellers Deal with Postal Rate Changes?

by: Tom

Sun Apr 1 13:30:34 2007

I buy and sell vinyl LP records on eBay and GEMM. I anticipate that the huge 50% increase in media mail rates will effectively destroy this market--at least on eBay. Most buyers will balk at paying more than $6.00 total (including shipping) for an LP. With fewer sales, and the high unlikeliness that eBay will lower listing fees in that category, the number of listings will dramatically go down--I'm confident that mine will. And as a buyer also, fewer listings means a lot of the more obscure titles I'm interested in won't even get listed on eBay anymore.... I'll bet similar problems will affect booksellers as well. I understand increased costs are a necessary evil, but why can't the USPS spread the pain just a tad more evenly, instead of putting a 50% increase on one particular genre of shipping?

How Will Sellers Deal with Postal Rate Changes?

Sun Apr 1 15:50:21 2007

I'm going to have to raise my shipping charge, and my buyers are going to have to pay for it. I'm concerned about the HUGE increase in the priority mail and flat rate costs. And I'm unsure how to change the 1200+ store listings I have to reflect this price increase (both for first class and priority, since I give my customers a choice) so that I don't lose money on shipping.

How Will Sellers Deal with Postal Rate Changes?

Sun Apr 1 16:31:51 2007

Guess I need to pay attention to my world. I sell used books. If media rates are increasing 50 percent then I am afraid I will literally be put out of business. I am gong to start working overtime before the increase to clear out my inventory. It is time to think of someting else.

How Will Sellers Deal with Postal Rate Changes?

by: Randy Smythe

Sun Apr 1 20:50:10 2007

Marketplaces like Amazon and Half.com will have to adjust their shipping reimbursement or risk losing business so sellers on those marketplaces should be okay. eBay sellers are worried about raising S&H charges in light of the crack down on excessive S&H and the imminent launch of Feedback 2.0 as well as the general need to be lowest price to get the sale.

What’s a seller to do? Certainly pass the cost on to the customer and realize that your competitors are all in the same boat. There is no need to worry just develop a plan and test it out before the increase goes into effect but don’t delay March 14th is just around the corner.

How Will Sellers Deal with Postal Rate Changes?

by: Sweetkatie

Mon Apr 2 14:57:46 2007

It isn't so much what I have to pay, it is what my customer will have to pay, and they are the ones that are going to be complaining. Papajohn must not be a seller to make the comments he made. I understand that rates have to go up, but believe me, my customers don't.

Here is a perfect example, and this is BEFORE any rate increases. I sold two sets of Lego's to a customer. I sent her a combined invoice. I charge actual shipping plus a $2.00 handling fee that I clearly state in my auction. Other than the $2.oo, I do not make any money on shipping. She wrote back 3 times asking me to again combine the shipping as it was coming up too high. I explained that the invoice was correct but she accused me of overcharging her and not combining shipping as I stated I would do in my aution. After 30 days I finally had to file a UID. 10 days after I filed the UID, she paid, but she did it very recluctantly, still claiming that I cheated her. At that point I decided I wasn't going to deal with this woman. I refunded her payment and just wanted to move on. She then left me negative feedback that was a total lie. I responded to her feedback and left her negative feedback to which she responded and still lied and had the balls to call me the liar.

As I siad, this was BEFORE any rate increase. God forbid with the increase comes. I hate to think of the complaints we sellers are going to get.

How Will Sellers Deal with Postal Rate Changes?

by: DG

Mon Apr 2 16:18:08 2007

I ship light smalls via USPS 1st class with DSI insurance (i have flat rate coverage from DSI). The only viable way to ship them safely is USPS. I have already raised my flat s/h rates effective 1/1/07 in anticipation of the increases. My flat rate charged for most items covers postage, supplies (small boxes, tissue & bubble wrap, business card) and fees. No complaints from customers ever. Guess I sell in an easy niche with reasonable customers and I give them more than expected with daily shipping and nicely presented safe packing. So I have covered the increase as of 1/1 and adjusted for what I see as a simple increase in the cost of doing business.

How Will Sellers Deal with Postal Rate Changes?

by: Susan Vanderhoof

Mon Apr 2 18:07:42 2007

I sell specialty items and collectibles that can range from very light to quite heavy. I was exclusively shipping USPS. I typically ship priority because speedy delivery pleases my customers and seems more reliable. USPS has lost two valuable packages in the last two weeks - thank goodness they were insured, but I still incur business costs, plus neat, valuable antiques are lost. I am now going to pay very close attention to UPS & Fed Ex before offering USPS. Just a part of business!

How Will Sellers Deal with Postal Rate Changes?

by: John

Tue Apr 3 00:03:16 2007

The US Postal Service is second to none! In the 8 years I've been selling on Ebay with an average of 40 packages a week the US Postal Service has lost ZERO, damaged ZERO and returned ZERO. I give the US Postal service an 11 out of 10...If you think Fedex or UPS has better service I'm sure you'll find out soon enough that they DON'T!

How Will Sellers Deal with Postal Rate Changes?

by: gejbooks

Tue Apr 3 06:56:54 2007

Although Media Mail is going up a lot for lightweight packages, it's not 50%. The increase is 34% for a 1-pound package (from $1.59 to $2.13), 19% for a 2-pound package and the new rates are a reduction in cost for packages over 5 pounds. As others have said, we sellers will just pass increases along to the customers.

There are more significant changes to international rates - big increases and the elimination of surface mail - and a new flat-rate global priority box.

UPS and FedEx will probably start looking more attractive vs. Priority Mail.

How Will Sellers Deal with Postal Rate Changes?

by: Carol Hearn

Tue Apr 3 08:19:04 2007

Most small and medium sellers haven't taken the time to learn about the significant increases in first class mail and bulky (but lightweight) packages. They are going to get a BIG surprise. The big outcry will come at the end of May.
USPS has done an extremely poor job of explaining the increases.

How Will Sellers Deal with Postal Rate Changes?

by: d1236m

Tue Apr 3 11:01:08 2007

Although we don't like cost increases, we look at it as a way to insure continued great service by the USPS in light of increased transportaion and labor costs.

We have shipped over 3,000 packages in the last 4 years via USPS (mostly Priority Mail) and have not had one damaged or lost. They even provide the boxes for shipping and pick them up at our door for no added cost.

We love the postal service!

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