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Joined: Jan 2009
Posts: 29,788 Likes: 1295
Moderator Ambassador Field Correspondent  Lunker
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Moderator Ambassador Field Correspondent  Lunker
Joined: Jan 2009
Posts: 29,788 Likes: 1295 |
If I want to ship a package I have 3 choices. USPS, FedEx and UPS.
USPS is about a mile away. Their hours are 8-noon M-F, 8-10 Sat.
UPS is roughly 25 miles away in Bourbon, IN and is open from 5pm-7pm M-F
FedEx is roughly 30 miles away at the South Bend Airport. I don't know the hours.
Using my account with FedEx or UPS I could use my account number and drive 10 miles to Plymouth and drop off the package at the "you ship" store.
I consider that driving anywhere costs $0.65 per mile when you figure in vehicle cost, all maintenance, fuel, and insurance, not including my time spent on the road.
So, I have to run the numbers and see what is more cost effective for me when it comes to shipping. Do I want to spend an hour on the road driving to and from to drop off packages plus put miles on the vehicle? Or is it more cost effective to spend more on shipping but eventually have less $$ out of pocket?
A business cannot charge what it costs them to provide a service, or it would be just exchanging money. There are a lot of hidden costs that customers don't think about. A business that has guaranteed delivery times can't use 10 year old equipment that might break down. New equipment costs $$ and that has to be paid by someone. A $$ reserve has to be held for emergency expenses, etc., etc.
Fuel changes price daily. I cannot see a viable business that doesn't have some sort of price adjustment yearly unless there is enough profit built into the item to average out costs over 2 or more years. When costs are fluctuating, I cannot see how a business can stay profitable by not passing on those costs to it's customers. The tighter your margins are, the more important it is to pass those costs on quickly, or a business will be selling things at a loss, and it won't stay around very long if that happens too often.
Until I see at least one truck running around with Baird Freight on the side of the truck, I have to stick with the big 3 and adjust prices accordingly. Am I happy about what things cost today vs. what the customers are willing to pay? No. Is there anything I can do about it? No.
A customer the other day was complaining about the price of a certain item. They found it on-line for "X" amount from an out of state company. They wanted to know if I would price match. I looked up the price on what it would cost me to ship, the credit card fees, my product cost and the state sales tax on the item.
After I figured that out, I saw where I would make less than 2% on the sale, and that was if I didn't have to spend any time on the telephone with them walking them through how to use the product. On a sale of less than $200, what would the majority of people on here have done? Say yes or tell them that you couldn't match the price?
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