4 Easy Ways to Reduce eBay Shipping Costs
How to Save Money on eBay Shipping Costs
Shipping cost is one of the top factors buyers use to decide if they want to purchase your item or not. However, if you charge too little for shipping, you can end up eating away at your profit.
As a new eBay seller, finding a balance of shipping estimates and actual shipping costs is one of the hardest things to learn. While charging too little for shipping will affect your gross profit, charging too much can also deter potential buyers. Finding a steady balance between the two is the best way to ship your item without losing money or customers.
In the following segments, I will break down some of the key aspects successful sellers use to improve eBay sales and limit profit loss.
#1. Know your shipping rate costs
As an eBay seller, you need to know how to take advantage of all the different shipping options that are available to you. These options range from using Media Mail, when permitted, to using smaller boxes for items that don't have to go in those bulky Priority Flat Rate boxes.
While many sellers mistakenly use the shipping price calculator on usps.com, I want to teach you how to use your eBay shipping label tool to calculate an exact shipping cost and save you more money.
#2. Use eBay Shipping Labels to save money
There are a couple different ways of calculating a price with the tools eBay provides to sellers, the most popular being the eBay Shipping Calculator. The eBay Shipping Calculator is easy to use and will give you a ballpark price of what you can expect to pay for shipping, but it is definitely not the best tool eBay provides for sellers to use.
The most accurate way to get an exact shipping cost is to use the eBay Shipping Label tool. To do this, you will need to have sold an item in the past in order to have access to the eBay Shipping Label calculator, which is entirely different from the eBay Shipping Calculator because it adjusts the actual shipping cost eBay sellers pay after eBay shipping discounts for sellers.
If you have never sold an item on eBay, find somebody you know that has an eBay account, set up a Buy It Now auction for $1.00 and have them purchase it. Nobody ever actually has to spend any money if you change your Buy It Now payment options to not require immediate payment. Once your friend has used Buy It Now on the item you listed, you can mark the item as paid and continue to use the item for future shipping calculations.
If you have sold an item, find your orders that have been shipped within your eBay Seller page. Even if the item has already been shipped, you will still be able to use the Shipping Label tool to calculate a price.
- Use the drop down feature to the left of the item title (it will probably display "Leave Feedback" or "View PayPal transaction") and click on "Print shipping labels or Invoices".
- This will take you to a new page with different options. Usually the option you want is already selected, so you can just click on the "continue" button.
- You are now at the eBay Shipping Label page. From within this page you can change the buyer's address to determine an exact rate to an exact location or just use the address already provided to still get an accurate shipping estimate.
- Underneath the "Shipping Details" section, you will see a"Carrier" option and a "Service" option along with some other additional options like signature confirmation. For the most part, you will probably use USPS as your carrier, so you can leave that section alone.
- The "Service" option is the main section you will use to calculate an exact shipping estimate. For any item under 1 lb, I always use the First Class option to calculate my shipment. Anything over 1 lb will require Priority Mail unless you are able to ship your item via Media Mail.
- Once you have selected which service applies to your item, you'll be able to enter in package dimensions and a custom weight which should give you an exact shipping amount you can expect to pay.
- I recommend buying a digital scale if you plan on selling multiple items. Digital scales can be purchased for as little as $15.
Many sellers make the mistake of shipping their item in a universally metered or flat rate box. This is what I call "Lazy Shipping". Lazy shipping practices can drastically affect your profit margin.
Let's go ahead and skip past the First Class shipping option of 1 lb and say I want to ship an item that weighs 2 lbs. This item would require a box that is 11 inches long by 11 inches wide by 5 inches in height.
This particular item could fit in a Medium Flat Rate Priority Box for $13.60 cost or a Large Flat Rate Priority Box for $18.85 cost. This item can actually be shipped for $7.91, nearly half the cost of any flat rate option.
Many sellers do not take advantage of using the custom size feature that is available through the eBay shipping label tool. The only catch to saving money through this method is that you have to measure each side of your package, which takes all of 1 minute of your time. Unless your time is worth $300 an hour, one minute of your time to save at least $5 is not much to ask.
- If you are using flat rate boxes to ship 20 items per month when you could be shipping the item for $5 less than the lowest flat rate option, you could save $100 per month on shipping cost.
Other ways using eBay Shipping Labels saves you money
If you are a new seller to eBay, you may not be aware that eBay offers discounted shipping to their sellers through the eBay shipping label program. This is a contract agreement between eBay and Shipping services such as USPS and UPS alike.
You aren't going to save $1 per shipment, but you can very easily save 10 to 20 cents per shipment. For those shipping in bulk, 10 to 20 cents per package can add up very quickly.
The best part of the eBay shipping label tool is that you have a variety of options. You can calculate a price, print invoices, print packing slips and print scan forms.
- If you normally ship 50 items per month at a $2.91 per item, you could potentially ship the item with eBay labels for $2.77 per item, saving you $7 per month.
#3. Stop wasting Printer Paper and Ink
Invoices, Packing Slips and Scan Forms are very attractive to many eBay sellers, but are they really necessary?
I'm going to go a little green on you here.
Packing Slips and Invoices are not necessary to include in each shipment. If you feel you must include one of these with each shipment go ahead, but you are wasting money and time that you don't have to.
If you want a customer to have an invoice, simply send them an eBay message and let them know where they can find it. I have a pre-written message for just this purpose. For Packing Slips, do the same thing. Let them know that each item they ordered was packaged. Simply copy and paste their items from the sales record and send it via eBay message to them. A printed piece of paper included with their package will not lower the chance of return or customer dissatisfaction in any way.
If you are shipping 100 items per week as I usually am, if not more, you could be wasting up to 200 sheets of paper, not to mention printer ink. I know it doesn't seem like much, but if you save a little money here and there it eventually adds up to more than you would ever dream.
Let's address Scan Forms. I do use Scan Forms for the simple reason that they ensure all of my packages are scanned into acceptance with one scan. This is a must for any eBay seller that is shipping 5 or more items at once. Whether you have scheduled a pick-up or are delivering your packages in person to the post office, scan forms are the quickest way to make sure your items are scanned and marked as shipped. When I first started shipping items to customers I would drop off ten packages and notice that they had not been scanned in until the next day. This automatically affected my eBay handling time. Once I started using scan forms, this problem went away. Be considerate of your postal workers and they will be considerate of you.
- A package of printer paper is 500 sheets at $6 per package on average. If you ship 50 items per week, you could save around $5 per month by not printing packing slips and invoices for each package.
#4. Buy shipping supplies in bulk
You don't have to have a warehouse to store all your shipping supplies. If you have a storage closet or shed, these items can be kept there with little interference. I am able to house all of my supplies in a 4' x 4' space. This includes over 100 shipping boxes, 32 rolls of tape and other miscellaneous items.
Tape is what a lot of sellers pay way too much for. The average cost of a single roll of packaging tape is $3 for 55 yards of tape. You can get tape in bulk for about $1.50 a roll or less, depending on your need, that is also twice the length of the standard roll at 110 yards. You are automatically saving four times as much money. 36 rolls of packaging tape sells for $54 including shipping any day on eBay.
Now let's talk about shipping boxes and packaging materials.
If you are an eBay store subscriber, you are offered $50 in shipping supplies each month. A lot of sellers opt to buy bags or tape. Instead of opting for either of those, go with the biggest box you can find. The 12 x 12 x 18 is my box of choice, but there are other options that may suit you better.
Now I say go with the biggest box because even if you are not selling items of that size, you can make a custom box and use the extra pieces you don't need for reinforcing, making layers or a wide range of other ideas. You can usually get 50 boxes and sometimes more without ever having to spend a dime on boxes. Compare this to spending 75 cents or in most cases more per box from Home Depot or other general stores. This method alone will save you at least $37 per 50 boxes. Use your creative juices to figure out what you could use extra pieces of unused boxes for or research ways of making custom boxes for shipping. This is also a great way for those shipping flat items to do away with shipping bags completely as you can sandwich the item between two pieces of cardboard, tape it up and send it on its' way.
- Buying packaging tape in single rolls for $6 per 110 yards versus buying in bulk for $1.50 per 110 yards. That's a total savings of $2.25 per standard roll of packaging tape, meaning if you are using 4 rolls of tape per month, you could be saving close to $10 per month on tape alone. This may not seem like much money, but we will add everything up at the end.
- Buying boxes at Home Depot or another general store costs at least 75 cents per box versus getting your own free boxes from eBay. That's a total savings of 75 cents per box, meaning if you are using 50 boxes per month, you could be saving $37 on boxes alone.
How much you can save by following these simple techniques
We have discussed several different money saving techniques as it pertains to shipping.
If we add up each potential savings, we come up with a grand total of $160 per month with the examples we have used. Note that these examples are based on basic eBay store membership averages of less than 100 sales per month, meaning these techniques are aimed to save you $1.60 per package on average.