A shop with no delivery fee?

Are you sometimes finding your order too small to be justified for the
shipping cost? I sometimes wish to buy a pair of socks or a single HDMI
cable, and find shipping cost a lot higher than the goods.

I intend to build an online store that never charges delivery fee. The trick
is to sell all small items that can fold and fits into an envelop. Envelops
are cheaper to send and envelops are fast (dispatch from Australia).

There are lots of things that can be put to the limited 2cm envelop space,
e.g. folded cups (made by paper or soft silicone). You wouldn't normally expect to see a computer mouse
be enveloped, but a foldable type can.

Have a look at my store (in-development, not open for business yet):
http://w.enveloped.com.au/

I post here to ask 2 questions:
1) do you find need of such an online store?
2) what (else) do you want to see deliverred in an envelop?

I intend to sell goods at similiar price to other online stores (COTD?),
except delivery is always free and always in envelops, and even an $1 order
is delivery-free‡. The advertisement normally spent for online stores I will
spend in envelop postage and ozbargain community can be my first ad agent.
How do you think?

(The price I put there is matched against typical Aussie online stores. If I've mistakes, post to let me know.)

† Everything on that website is out-of-stock, because I haven't started
the business - once I do, the website will be 'www.enveloped.com.au' instead of 'w.enveloped.com.au'

‡ Kogan has cheap USB cable $1 delivery free send from China. But they may intend for export reward from China's government.

Related Stores

Enveloped
Enveloped

Comments

  • Maybe a pair of socks and a single hdmi, like in ur example

    • Yes I do that too, but I get nervous everytime, while waiting for shipment. When I run the store, I will be sending everything in short time - to start as a small business same-day dispatch should be possible. I hope sending from Queensland won't take too long. Australia Post says "Between metropolitan areas of capital cities -> 2 days", that makes total wait 3 days. I experimented: same-city envelops usually arrive the next day.

  • zhangweiwu I like the name and concept.
    If you have a lot of useful or popular gear, say 500+ items, and price is only a dollar or two above ebay/aliexpress, I'd be a repeat, happy customer. Would'nt mind waiting a week or two if it states delay.
    Good luck, I'll check my bookmark in the next months.

    • Thanks for being so specific on your needs! When you say "Gear" do you imply electronics? like gearbest.com? There is a reason the kind of service you expect (+2 AUD; -2 week's waiting) isn't there yet:

      Every single Aussie purchase is exempted from GST and import duty. If the merchant wants to achieve 1 to 2 week's delivery, they will have to either warehouse it in Australia or dispatch multiple-goods in one air parcel to be redistributed in Australia. Either case incurrs GST and import duty, which worth about 1 to 2 AUD for most gears. Now, if you factor in the re-distribution or warehouse cost, there would be no profit since the Chinese sellers had very little margin to start with. Since I pay GST and import duty, the goods are already +1 or +2 AUD when I sourced them. Also China-Aussie postage is cheaper than Aussie-Aussie.

      So it's more practical to delivery it 4 days and compete against Australian online stores instead of Chinese-ebay sellers or aliexpress.

      I'll keep the need in mind and see if there are solutions, maybe there is a new way to satisfy your needs. Thanks a lot! and please do come back, maybe soon you will find my store's offering good enough:)

      If you mean mainly Electronics, their variety is huge, naturally you need 500+ items to call a shop. Mabye I should talk to the online stores who already have 500+ items and steamline warehouse for them. If redistribution is sufficiently efficent, there could be some margin - it's so easy to reach this idea for a normal store like gearbest.com, that I guess they already tried it and didn't get it working that way.

  • +1

    I have been told off by AusPost before for sending non-letter items as letters. Once, an item of clothing that was small enough to fold into an envelope - they sent me a bill for the excess delivery charges with the reason: "not a letter". Another time, I wanted to send a single Pandora bead, and was told by the post office that I cannot send it in an envelope, it has to be in a parcel. Lol, ridiculous.
    So yeah, good idea, as long as you can get away with it. I have sent DVDs/CDs as "letters" before with no problem.

    • Thanks for the info! Brisbane's local post office confirmed they can send non-letter items provide that I pay "Large Letter" fee (15% of parcel), and I wrapped a few items, one battery recharger, one piece of cloth, in front of them, and I got them deliverred. I'll be cautious and experiment their tolerance in practise. In theory, according to post office's public PDF files, even dangeruos goods (batteries) can be deliverred that way, provide it is only a small quantity inside.

      I kind of expect them appreciate me. The way I started my idea, is reading news saying that Australia Post is having losses to maintain envelop delivery
      capacity because nowadays people uses them less, and asking for government subsidy or something. I thought I am doing them a favour to make letters important again:)

      • +12

        I used to work for AusPost in a Mail Centre, and operated the machines that sort the letters. Basically, with what I know, I wouldn't do what you are suggesting.
        It's not a case of appreciating business or losing money; the machines can't handle irregular objects.

        Every time someone sent something like: A marble, key/s, a pen, the machine breaks. And more often than not, the item was broken as well. The machines work by essentially squeezing the letters, applying huge amounts of pressure and they do get bent as they turn through the machine.
        Even Quickflix who send their DVDs through had to make specially designed envelopes in partnership with AusPost, and even THEN they could only go through certain machines and staff had to take special care.

        • Thanks a lot for the info! I just upvoted it. I did my talk with local post office, then, I am excactly looking to talk to someone in the Mail Centres - such people don't come by easily. Now that you are here, I have more questions:

          1. The intorlerance of the machine applies to the bubble bagged letters that does not exceed 2cm, is it correct? Local post office guy told me, that if it is bubble bagged, and less than 2cm, they accept it, including even mobile phones (asked). I know 'accepts' is not equal to 'processes'. I believe you do mean that even these fit-description objects would still cause problems, right? since DVDs should be already packed that way and still fail sometimes.

          2. What non-letter object would not block the machine? e.g. a scarf? I can specialize in certain things.

          3. I assume, logically, the mail goes to these machines in their first stop, in the sending city, not in the arriving city, right? If the consumers find the need of my service, I can relocate to the best Mail Centre myself where they have least problem processing these DVDs, and use the knowlege of what works already. Relocating is not a big deal because I just moved to Australia.

          Also, an Aussie friend once told me that this concept is a bit like an old Australia online service that envelops new razor blades once in a while when customers finished off the old ones - a razor blade subscription service. But he can't remember the name of it. Maybe you happen to know them too since you already introduced me Quickfix. The case of Quickflix is one that worth studying. I wish to learn from there success or failure.

          Thanks!

        • @zhangweiwu: If it's an irregular shape then one of two things happen. Either it gets sorted as a letter by hand, and staff will notice the irregular shapes and action would eventually be taken, or it will be processed through the small parcel machines and they will probably bill you with admin charges on top.

          You could put small, flexible items in a letter perhaps. Eg, a USB cable. A scarf would simply be too bulky.
          You probably could put a thin mobile in a bubble bag and be under 2cm. But it still couldn't pass through the machines. Be prepared for some broken phones and angry letters returned to you. (Plus, thin phone required = smartphone = expensive. With no tracking = bad idea). Mail gets sorted in the sending location first, then travels to the destination for final sorting.

          Basically, I'm trying to tell you it's a bad idea. Too many issues, too many things that wouldn't fit/work in an envelope, too many possibilities of your things getting broken.
          You're not the first to try to send items as letters that are not letters. AusPost will not accept it. It's a parcel.

        • @zhangweiwu: Not sure if this is the one you're thinking of, as I wouldnt say its 'old', but Dollar Shave Club?

        • @jaybmate: Hey, I think it's it! Thanks!

        • @djmatt24: That's so much information I need, Thanks. The most important information for me is that mails gets sorted in the destination city's machines, so relocating isn't helpful.

          "letters that are not letters - AusPost will not accept it", but we have the knowledge of your earlier description (e.g. Quickfix), the document (Letters product service guide May 13, page 7 where the difference between large letter and parcel), and local post office suggestion (they suggested me to use large letter instead of parcel when I first showed samples) and practical experience:

          Actually before I start, as an experiment,
          I already ordered many packages from different
          ebay sellers (from Australia) who, I suspected,
          would deliver in large letters, and I indeed got
          them in large letters. So it's not a new idea.
          (quote myself from an earlier post on this thread)

          Especially AusPost's own document makes it look like it's an AusPost's efficiency issue too, not entirely non-complaince issue of the senders. Meantime I can assure you I am not the type who know it doesn't qualify large letter and wish to get away. And I will make max use of the knowledge how things works for AusPost.

          Lack of tracking have impact on a few things that I want to think about.

  • A cheap brand-name coin battery less than $2.50 a pair like this would be a good start! You can get them for $2.80 a pair from shops like Daiso.

  • Pretty sure there's already similar type of stores that dont charge a delivery fee, the delivery fee instead is added into the item cost. If the buyer is buying multiple items, your model is probably more expensive for the buyer than if the store charge a flat postage fee.

  • also with regular letter post no tracking items will go "missing" and the Paypal disputes will come hard and fast (if you accept Paypal)

    • That put a stop sign on all valuable items like mobile phone. But it also makes marketing compaign easier: since nothing is more expensive than, say, $10, it's possible to announce that repeat customers can get "anything" for free once in a while, and nothing in range is too expensive to afford:)

      Actually before I start, as an experiment, I already ordered many packages from different ebay sellers (from Australia) who, I suspected, would deliver in large letters, and I indeed got them in large letters. So it's not a new idea. Only the specializing of it may be a new idea.

      I am also considering to resend to the areas known to have mid/big rain, as part of the budget. But that works only if customers appreciate such action.

    • It's easy to resend a few inexpensive packages if the item is gone, but wouldn't it be too easy to trick the system into keep sending or refunding, when the goods are actually consumed? I observed that human contact reduces such 'trick', so perhaps follow up a call before resending would solve it.

  • for high value items, use a registered or signature on delivery label. They can be purchased from the Post office individually or buy in bulk from ebay. As long as you lodge it at the counter to update the tracking, that will protect you from claims on non delivery.

    • I got so much helpful feedback today! Thank you all!
      (Had to sleep, another hard working day ahead)

  • The only problem I see with your model is this:
    1. You will import let's say a cable in bulk. You got the cables for a decent $0.20 AUD each. EXCELLENT
    2. You post this item on your website for $2. So far, so good.
    3. Someone buys your item, pays via let's say.. Paypal
    3a. Here is the problem - As AusPost already advised you, you have to send the letter as a "large letter" meaning at least you have to pay $1.40 (2 stamps) + $0.05 envelope + $0.35 Paypal transaction fee + 2.2% paypal fee ($0.05).
    4. TOTAL EXPENSES: $0.20 Cable + $1.40 postage + $0.05 envelope + $0.40 Paypal = $2.05, you just lost $0.05 (this doesn't even include YOUR TIME and TRAVEL costs to
    drop off parcel)
    5. Problem here is, if you try and sell a $0.20 cable for more than $2, you will not be competing much.

    • You are right that I can't sell it at 2$ (if you checked the in-development site, there is nothing this cheap there) - and even worse, since I buy cable in bulk, instead of selling them directly from China to each individual customers like aliexpress, I have to pay import duty and GST, which adds about 15%. More losses if I sell at 2$.

      So based in Australia there is no way for me to compete against ebay sellers from China. I explained this in an earlier post to NOYANONO.

      What I can do is to compete against Australian stores. Kogan for example sells USB3.0 cable around A$10, with postage would be A$19.†

      So the real question is: is there space to play on the level of Australian stores? Do I must fight Aliexpress sellers? That bogs down to two questions.

      1) do Australians value fast delivery and being able to call a local number?
      (And not to email someone who starts every sentance with "My Friend"‡?)

      So far the ozbargain feedback prefers NO - we can wait the Chinese delivery.

      2) does it cost too much to expose the business to Australians who do value this service?

      Maybe true: those who would be able to notice a specialized enveloped goods store are also those who would spend time browse ebay and wait for weeks - if it is the case, there is no busiess.


      Kogan do sell USB2.0 cable at $1, but they don't do so at loss. They have a Chinese partner who ships it, who reported $6 (a lie) worth of export to China's customs, and thanks to China's policy of refunding exporters (a measurement to make Chinese exports competitive on price), they probably get more refund than sales revenue as profit. They can use this to subsidize other products imported from China. This, is my speculation after seeing their overpriced customs declaration.

      In case you don't get it, China's e-commerce culture requires every seller start every sentance with "My Friend" when they communicate directly to customers. If you buy from ebay China seller, you are likely to receive a message in that style.

      • +2

        Personally, I think there is very little margin and basically you will be playing with CENTS. That is not a viable business. If you are running on a very small profit margin, if Australia Post or Paypal increase their fees - There goes your profit and your business (example Paypal changed their fixed fee from $0.30 to $0.35 in the last couple months)

        Now, in regards to speed of service, I personally prefer it to be shipped locally BUT here is my opinion on it
        1) If a small item is $1 from china and $2 from Australia, I might go for Australia depending on urgency. If the $1 item is sold for $5 from Australia, then I'll go China.

        2) If a bigger item for example I recently bought an RC airplane. From china they were selling for about $61 AUD (converted from USD) - From Australia they were selling for $69.99 - in this case even though about $9 more expensive, I opted for Australia. Why? Because it's a delicate item, it's not a cheap $1 item and it's more convenient. Also, if I had to return the item in case it was faulty, I'd only pay for local return shipping ($7.45).. not a huge box to china which might cost as much as the RC itself. PROBLEM: It does NOT fit in an envelope :)

        • Very good summarize. Thanks!

  • better to start on ebay first but they have selling fee's too.

  • If you start taking customers from the big companies..they can cut the shipping cost and still turn a profit.
    Is your idea for short term or long term?

    • Thanks, I am flattered - I will be struggling getting noticed, lest getting shot in competition. They have to notice me in order to take me down:) That means I already cut a cornor.

      If they cut shipping cost because of me, and I make sure that they have to battle 1 month, they will find difficult to raise the shipping cost ever again, and I'll walk away with the proud that I changed e-commerce landscape once:)

      But the real long term goal is: I would love to move to subscription service as soon as possible, how about a warm feeling knowing your daily needs (razor, socks and other consumables - condoms) are taken care in the mailbox? "your little needs are enveloped", an envelop that arrives on time of need without asking, how about that? That's why I want to start with quality goods. People don't need the warm feeling of having crap arriving when they need them.

      Anyway, I started 3 businesses before, usually it's easier to die in your own hands (idea invalid, business structure bad etc etc) than being targeted and shot in competition. Also, shipping cost is bound to reduce anyway, without me kicking them.

  • If your current prices are what you intend to sell stuff for, I personally wouldn't buy. You might appeal to people who can't get to any store so need the item posted, and can't wait for shipping from China, but how big is that market?

    • I naïvely matched the price to these references:
      a. online stores (kogan, cotd)
      b. Aussie local ebay sellers (not Chinese ones)

      The idea is that if the price is the same, no-postage is an advantage. So when you say you don't want to buy, do you mean:

      1. "You didn't honestly match your price against a) and b), I found."
      2. "I won't buy from a) and b) anyway. You need to be 1 or 2 USD higher than Chinese ebay sellers to get me. a) and b) are for other people who don't know where to find bargains" (This is the feedback from NOYANONO, to which, Tcm9669, apparently an experienced seller, explained that it doesn't work, but I can try to find a middle ground.)

      If 1), can you point out examples? I am unsure if I did it right anyway and intend to go through competition in the coming days again.

      If 2), then what is the reason a) and b) can sell? That begets the question who are the users of a) and b) and for these people why do they shop online at all. Which is more important?

      • Cheap
      • Bulk discount
      • Item not found in local store
      • Can't afford the time shopping
      • More Choices

      The price is by no means final, it together with my selection of items to sell is a probe against market.

      I am really thankful to have received so much feedback in this community!

  • Great idea, wish you all the best

    I send all sorts of jewellery, phone cases, books and more as letters through Toowong (Brisbane) Business Centre, never had a problem and the staff know exactly what I send.
    I highly recommend these boxes, they are designed specifically to post as letters:
    http://ebpak.com/superflat-letterbox/

    Other thing that comes to mind that may have been mentioned (sorry I only skimmed the comments). Australia Post will soon be increasing the cost of sending letters and the delivery time.
    http://auspost.com.au/media/documents/Reform-Fact-Sheet.pdf

  • +1

    Auspost are increasing prices by a lot soon. Like $1 for a letter.

    • This…
      Was in the news recently, and will kill your profit margin outright.

  • some large UK stores often offer free delivery to Australia, and it's sometimes even quicker than interstate delivery here!

    • I wonder how they do that. I have received clothing from UK pretty quickly, usually within 3 days of ordering it. It's some impressive stuff.

      Auspost however is a uncompetitive monopolistic behemoth that is more interested in profits than their customers. All they care is their own stakeholders, revenue and increasing postage fees in response to the boom and uptake of e-tailling (they work very closely with eBay)

      Small businesses however usually shafted on high postage fees unless they can organise some kind of bulk mailling discount.

      https://www.choice.com.au/shopping/online-shopping/buying-on…

  • ebay…

    usually $1 things shipped from hk/china = no freight charge
    but then try ordering the same $1 item (usually cables/adaptors) locally and get charged $8.95 auspost rate…

  • I like the concept, but I'm never fooled by the 'free delivery'. It's just that delivery is included in the price. If you want to buy multiple items, sometimes it's cheaper to buy from a store that does charge delivery. For example Book Depository is great, but if I'm ordering a few books, Amazon can often be cheaper.

  • About two years ago my work had a semi-popular OZB deal for cheap 8GB USB sticks. We were relatively new to AusPost's methods at the time and figured charging people $1 or whatever for postage was cool. Instead we ended up losing a few cents/dollars (can barely remember now) on each customer who ordered just one stick to be shipped via AusPost.

    Since the above commenter djmatt24 pointed out how things work at AusPost's mail processing plants, I wouldn't rely on being able to send anything that isn't paper via their regular mail service.

    We package everything posted with AusPost now, bubble wrap and/or black cling wrap as deemed necessary, and pay about $7-$9 for small items (tracking is a must since customers that like to 'bend the truth'), or more for larger/heavier ones. We use Couriers Please / Fastway most of the time, since we mostly ship out large boxes that AusPost would murder us for on price. Only occasionally do we head down to AusPost these days. If you can get enough volume and can qualify for AusPost's eParcel, you might be onto something, but I'm sure the prices are still more than what you envision for your business to incorporate it into the cost of your products.

    Don't put all your eggs in one basket (AusPost) as any changes they make could make or break your profit margin/business.

    As SirFibbled pointed out, shops that do away with postage costs and build it into their product cost can quickly become overly expensive if buying many items in one go, which would likely make customers leave or check out multiple times, leaving you to process more orders than necessary.

    A bit wordy, sorry.

    • rloose, I love your candid advises! And you are the first to give me exactly what I need and apologize for wordiness:) When you say that customer claims , bending the truth, what is the value of the product with which they did this, how much percent dispatched goods are claimed lost and how much percent of lost case are 'bending the truth' story? Just hazard a guess if you didn't tally. I need to mentally prepare myself for the challange.

      There are a few cases people want to lie about not having received goods: a) they want more of it so they blame the first batch stained; b) they want it but don't want to pay.

      In the first case, it seems just giving them more would solve it (with a note that if they "found it", return it for free or send us photo, for the puruse of tallying liers) and if happen repeatedly, give them a call; In the later case, I fancy it has to be of substaintial value (>A$10) to motivate a refund claim.

      But these are my guesses, only experienced sellers know the truth. I never did e-commerce before and most data from Google are from U.S. when Aussie people seems nicer to me.

      Do you think OZBargain deals have higher 'bend the truth' rate?

      • Since the previously mentioned OZB USB deal and a few other claims of the customer "not receiving" their goods, we have changed it so all our shipping prices include tracking + some level of insurance. Since then, no issues come to mind that weren't rectified by insurance payout (a long ordeal you want to avoid at all costs!). All the orders in question were relatively low in cost, however. But when you're already barely making any money on orders, the additional time to deal with it and ship a replacement for free… it can start to add up.

        I do think OZBargainers have the tendency to bend the truth more. There are some who will grab at any freebie going, just for the sake of it. Some that respect the business offering it and only get it if they're interested. And those who exploit deals, sucking every dollar and cent possible while paying the least possible from their own pockets. It's human nature I guess.

        • Let me ask one question and this will be the last - you are already helping a lot: if I reserve a percentage to resend "not receiving" goods, e.g. in your OZB USB sales, which one is the closest to fact?

          • 1% has to be resent
          • 3% has to be resent
          • 5% has to be resent
          • 8% has to be resent
        • @zhangweiwu: I think it was probably 5% or 8% - the deal only took off because of OZBargain, so we have to be grateful for that, but quite a few of the ones we had to mail were 'lost'. It would have been cheaper for us to refund the order total, but as we wanted to give people the benefit of the doubt and not put OZB off-side on our first ever(?) posting, we took the hit and re-sent the items.

          You're onto something with your idea though. People will buy small things, even if they know they'll lose it or it will break etc. if the item is cheap and postage is non-existent or less than $1. But for this privilege, you get screwed by the dishonest who want to hoard their cheap things that they lose/break. :P

          Maybe you'll get lucky and things will go your way for the most part. It's probably something you need to try for yourself before you give up at least.

          Best of luck mate.

        • +1

          @rloos: who want to hoard their cheap things that they lose/break. :P

          This is exactly the market I want to serve: repeatedly send them small things that they use up (travel coffee bag, razor blades) or lose, as a subscription service, but it's in the long run and I don't have the reputation to ask for subscription yet. Thanks for the comment & data.

  • although it defeats your whole original idea (which sounds cool), maybe focus on your ability to deliver more quickly than overseas, even if you charge delivery and its a parcel rather than envelope. say it costs 10 overseas but you can charge 10 or so here and it is quicker. you wouldn't even need to sell a big range. just the obvious stuff that you can turn a profit on and be cheaper than local sellers.

  • +2

    I checked out the website a few days ago, when it was first posted. I saw some bottle openers that looked pretty cool, so I went to buy them. Before I went through paypal I realised the store wasn't really open. I didn't really give it much more thought as I hadn't paid for anything.

    Today I received a bottle opener and a credit card tool along with a note saying thanks for checking out the store.

    Thanks guys!

    • @zhangweiwu: as a subscription service, but it's in the long run and I don't have the reputation to ask for subscription yet.

      Oh I see that the reputation is being built:) Perhaps I should ask my ozbargain account to be crowned a shop-rep now:)

      P.S. Before the store open, we are working on expanding coverage so that every little thing are there, well, every little thing that fits an envelop, from Aussie flag (folded) to credit-card-holder etc.

  • PVA said:

    keep moving the store around a bit in design, something just doesnt
    seem inviting enough but I dont know what.

    Thanks for the suggestion. I changed the design style accordingly. Is it more "inviting" for you now? :)

    • it's looking better.

      I like http://www.enveloped.com.au/product/travel-wallet/
      but I cant really tell what its like, is it two items (first photo has a small and large wallet)?. And what colour as the photos show two colours?

      • +1

        One item. I updated description for now - photo update takes a few days. Thanks for pointing out!

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