Have you shipped a package to the east or west coast
recently only to find out that the shipping is more than the sale price of the
item? Yes it happens all the time now rates keep climbing year after year and in
particular with the US postal service. We previously covered some of the many
reasons in our article about the revenue
assurance program it’s really not a single problem but a multitude of issues combining to drain
revenue from the postal service. Loss of revenue from first class mail decline,
the high cost of 6 day a week deliveries and imports from countries like China
which ship for pennies on the dollar subsidized by you the US consumer. It’s no
secret that marketplaces like eBay, Amazon, Etsy and others are well aware of
the situation and how detrimental it is to their businesses. Both eBay and
Amazon have been very vocal about how some of these factors are negatively
affecting their marketplace sellers in fact just this week eBay is celebrating
its 12th annual eBay advocacy day an event where eBay flies in 20
sellers to meet with their congressman and a representative from the executive
branch to discuss some of the concerns of the eBay small business merchant.
While this is commendable it really does amount to a dog and pony show 20
sellers griping to their congressman are not going to fix this and
unfortunately this cannot be resolved without government intervention. Maybe
there is a quick fix… If not a complete fix how about a life preserver? Believe
it or not there is one but the bad news is it’s not happening and likely will
never happen. Well what is it? Simple stop marking up our shipping costs! When
you buy a label from sites like Amazon, eBay or Etsy do you really think that
cost is what the site paid USPS for that shipment? Of course not they have a
massive amount of leverage with USPS and the motto in online these days is make
a profit on everything from warehousing to listing, selling and purchasing
postage a nickel here and there adds up quickly. Well why wouldn’t they pass on
these savings if not in full then partially to keep their volume up? Not
happening because of wall street and shareholders again this is another revenue
stream that they have gotten very used to no one knows except the post office
just how good their rates are and they are quite content keeping those extra
dollars to keep their profits up as well as the share price. Is it a bit
hypocritical of these websites championing the little guy while squeezing him
for a few extra dollars on shipping fees yes absolutely particularly galling is
when they push you to offer free shipping are they giving you a better rate
when offering free shipping? of course not, again that would be cutting into
their bottom line. What’s the solution? Nothing is going to happen without the
government getting involved and the only way this will happen is if sellers and
marketplaces combine forces to push for change. Online retail is still
relatively new, remember Amazon, eBay and internet retail in general are just
over two decades old and if nothing is done to address these issues it could
have serious detrimental effects on millions of small business owners as well
as consumers.