Hi guys I am looking to open up a small online business. Currently I am at planning and research stage. It looks like I can't make any money or keep the price competitive after factoring the shipping cost. I am wondering how do companies like Dealfox etc. provide free shipping? If it was small items like cable, screen protectors I would understand because they only cost the price of a letter. But I bought stailess steel water bottles from them for less than $8 including shipping. How is that possible? Do they strike special deals with courier companies as they sell in huge numbers? How could I keep my shipping cost low as a starter?using Austpost is even more expensive I gather. Please help me with your advice.
How do sellers provide free postage?
apprentice on 17/05/2014 - 16:50
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You can't beat them. They ship out of places with low costs, e.g. HK, Singapore, Shenzhen, and in bulk.
In terms of postage. Maybe not. On ebay i normally buy locally if the price is a few bucks off due to the advantage of short shipping time.
Sure, that's what the OP has to do, avoid low value, low urgency items.
If not possible due to very cheap buy prices at a post going out of business auction, then perhaps a local business operator has access to AusPost:s cheap high-volume eParcel Service.
Lots of small businesses should form an AusPost acceptable affiliation, that buys eParcel service together, to get into that high-volume, low-cost (per parcel) price-class.
Small membership fees would make such an affiliation work, with some web-app based way to arrange & pay for shipping of each eParcel.
I didn't think the eparcel discounts were that significant. Do you have any example figures?
International postage is a fraud, you only pay postage to get the item out of the country, then the receiving country foots the bill to deliver it. That means you'll never compete with Asia on price. So the advantages you have left at your disposal are 1. time (delivery next day vs 2 weeks), 2.service/aftersales, 3.Value add or 4.Dropship. Good luck.
is that really how that works? I was always wondering how the Chinese could sell items so cheap with free shipping.
Is this also why Shipping from other countries is so expensive (USA/GB) because they are paying for aus post to deliver it to me as opposed to just getting it to australia?
No, it's the same for all countries, the convention is that the sender pays to get it to the destination country. USA/GB Post have to charge their customers more to pay for their higher costs their end.
interesting so the reason Chinese post is soooo cheap is because the cost of employees and other things is so ridiculously low but because USA and GBP have workers rights and higher pay that gets passed to the seller and in turn me?
Thats very interesting I always thought there was some money trading place somewhere. But I suppose the lack of money transfer explains why international tracking is so shit since Aus post Doesn't care and has no reason to make it better.
Tracking is a value-added service so if you happen to be able to see where it is without paying for the service, that's considered a bonus. Remember that in the distant past, without barcodes, computers etc, there was no tracking.
A time before tracking. shudder
Almost as bad as a time before conveniently accessible ice cubes in a hot climate zone.
I think I was misled slightly by some of the discussion here - http://forums.whirlpool.net.au/archive/1917559 but its not far from the truth why postage is much cheaper from China->Au vs Au->China.
Here is the accurate truth - http://en.wikipedia.org/wiki/Universal_Postal_Union
To summarise, the amount charged to a country is the nett kg, so if China sends 100kg to Australia and we only send 20kg to China, China gets a bill for 100-20 = 80kg. However the rate is only something like $1 or $2/kg vs maybe $7 to send 500g just within Australia (ie $14/kg).
The problem with this system is that it costs many times as much to move a parcel around in Australia vs China due to labour costs etc, so their postage rates are much less and we as taxpayers who own AusPost effectively pay MOST of the cost to move the Chinese parcels once they land in Australia.Also their sellers are located close to expedition points—e.g. I imagine it doesn't cost that much per item to move a shipment from Mongkok to Chek Lap Kok—whereas recipients in this country are distributed all over.
Very interesting thanks!
There's no such thing a free shipping. Free shipping means the shipping cost has been factored into the selling price. Large organisations can use their buying power to secure better postage deals with Australia Post and/or courier companies.
Lots of multinationals ship out of Hong Kong, Singapore, etc., as postage is only a fraction of Australian rates.
we were just doing a return with Parcel Point flat rate $6.90. Don't forget the cost of RETURNS