Amazon consistently losing 1/3 of what I send, plus sending what they don’t lose on relaxed scenic journeys to far-flung FCs in one-starbucks towns in flyover states has put my product “out of stock” for the last time while they lose or sit on hundreds of units, and forced me to (ominous music) go FBM.
But Double-U Tee Eff?
So a customer places an order for a small item that can be shipped as First Class Mail, and is charged $8 and change for shipping. The actual cost of First Class postage is $5 and change through “buy shipping”.
Who gets that extra $3?
If it is me, can I write a macro to auto-refund this excess shipping charges back to the customer in real time, or must I wait until the order is shipped and received before issuing any kind of refund? Or will Amazon not look kindly on refunds with the memo “Shipping Overcharge Refund”?
First of all, some of us think FBM is awesome (happy, perky music).
So a customer places an order for a small item that can be shipped as First Class Mail, and is charged $8
Assuming you are a pro seller, as I’m sure you are, you set the shipping charges through your shipping templates. Amazon collects whatever amount from the buyer you tell them to. If they collect more than shipping actually costs you, then you pocket the difference. In your current scenario…
Who gets that extra $3?
That would be you. But…
Amazon takes their cut of the shipping charge too. The referral fee you pay is based on the total cost, including shipping. So if you’re in a 15% referral fee category, only $2.55 of that extra $3 goes to you, and 45 cents (15%) goes to Amazon.
If you want help setting up an FBM shipping template, just ask. It can be confusing the first time you look at it.
Thanks, I have left everything at the defaults, but I do have the correct weight and size of the package, so how could Amazon have messed up so badly on the shipping estimate? Now, perhaps it is because the order came in on a Saturday, and they did not expect me to ship until Monday, but priority mail for that package would have been MORE than $8 to that location.
I expected that Amazon would know the shipping rates from my zip code to the zip code of the buyer, and would be able to price the shipping exactly - there really should be no need for me to “buy shipping”, I should be able to select a configuation option to have this done as a matter of course for all FBM orders for certain products, and the shipping should be “pre-bought” and tracking number assigned when I get the order.
I am at times mystified at all this extra fuss and bother over what should be the simple spitting of shipping labels out of the zebra label printer, and the spitting of matching packing slips out of the other small-format printer. I have no idea why I have to write code to make this happen with the very klunky interface Amazon presents. As all I want is the packing list sheet, the mailing label, and a database record of the purchase. The “printer interface” amazon wants to use is horrible, the process apparently manual, and there seems to be no way to print a “mid-day” group scan sheet for the MORNING’S shipments, and a different “afternoon” USPS scan sheet for the afternoon’s shipments, as we have a mid-day pickup, and the afternoon’s packages would be dropped off at the local Postal Orifice.
So, must one buy some sort of subscription 3rd party middleware to have something that is even slightly working? Its annoying at 50 packages per day, I cannot possibly imagine this “working” at hundreds. (Hulk ANGRY, Hulk SMASH puny laptop and printer!)
Using a Priority Mail Flat Rate envelope (assuming as you stated the item can be shipped as First Class Mail), the price would be $7.60 with the weight limit of 20lbs going to anywhere in USA and a limit of 4lbs if it was an international shipment.
In reading your posts, it doesn’t seem as much of a price issue as it is a processing / work flow issue. We would take up @Roxy 's offer of help if it is needed on the shipping templates to control the pricing. We would bet that she also has some work flow tips or suggestions if given more details about the optional work flow.
Looking at the “template”, I see no better granularity than state name, when the USPS varies service times down to the 5-digit zip from any one 5-digit zip origin, so it looks like one has to quote the worst-case transit time for anywhere in a state to deal with the kludge that Amazon has for what should be a matrix of 5-digit zips straight from the post office or UPS or whatever.
Why should I have the risk placed on my shoulders surrounding courier transit times? If I am buying postage from Amazon, then THEY should know the service levels and quote the correct transit times from the post office to THEIR customer, who I only hear about AFTER the shipping has been quoted, selected, and paid for.
The rationale is you choose the carrier and level of service, and you are responsible for the ontime delivery.
It seems unfair to some but others of us accept it is our responsibility independent of where we make the sale. When you are in business you are responsible for many things which you do not control.
When a customer is unhappy for any reason, it is my problem.
I don’t mind accepting responsibility, but shipping in modern times is based upon 3-digit zip code areas for the most part, both in terms of pricing and transit times. Amazon’s slap-dash over-simplification to state boundaries is certain to harm the “customer experience” by overcharging some, and under-promising to others, as my only option is to quote the worst-case scenario for each state.
but shipping in modern times is based upon 3-digit zip code areas for the most part
Forgive me for laughing under my breath, but this 3-digit zip code stuff is what prompted Amazon to come up with their ‘shipping automation’ which I absolutely detest.
You can use the automated transit times if you like, and Amazon will do the behind-the-scenes work for you, but you still have to set your own shipping prices, or do things the easy way and just go with free shipping.
Amazon is still set on the same-price-for-everybody standard shipping they’ve had since the beginning, so you’re just going to have to accept that and work with it. It isn’t really as bad as you seem to think, but for someone dealing with it for the first time, especially coming from FBA, I can understand why you might think so.
If the customer is okay with the shipping price, why are you intent on refunding it? The money is already in your pocket. If you think you are overcharging, then lower the shipping fee. Unless you are an individual seller, the shipping fee is all under your control.
The risk placed upon your shoulders was created when you decided to become a retailer. Everything else is just variables that you have to mix and match to maintain a profitable business.
A little history
Before Amazon existed as seen today, our website had to deal with shipping. Back in those days, customers expected free shipping on the internet (late 1990s early 2000s). USPS First Class with delivery confirmation for a 3 oz item was $0.95. Our price was calculated for the item by adding the cost of the item, a % amount for website cost, PayPal transactional fees, USPS costs (which was the same anywhere in the US) and the profit we needed to make on the item. As USPS prices went up, we adjusted the item’s cost. When USPS introduced First Class Package and included delivery confirmation, we were excited as it meant less paper work in processing.
Determining Zone Pricing
When USPS introduced zones, it forced us to rethink how we could make it work with the different prices in zones. We were happy with the grouping of 1oz to 4oz, 5oz to 8oz, 9oz to 12oz and the 13oz to 15.999oz. This meant that most of our orders fit in the 1oz to 4oz and anything more we would put in a Priority Mail Flat Rate envelope (to get the included insurance). So now it was how to address the zone pricing for the 1oz to 4oz.
We are basically in the middle of the country here in the Panhandle of Texas. About 85% of our shipping is to zone 5 and zone 6. The remaining 15% is evenly split between zone 3, zone 4, zone 7 and zone 8. We decided that we could charge the zone 6 price to everyone and avoid trying to set up exact zone pricing. On everything sent to zone 6, zone 7 and zone 8, we would incur a small extra cost on shipping. On everything sent to zone 3, zone 4 and zone 5, we would gain a small extra income. It was basically a wash.
Setting the Zone Pricing to the Venue
Next was implementing the shipping cost into the different selling venues. On our site, we decided to have our item price stand by itself and then charge a flat shipping cost based on our calculations that zone 6 was our best average. On Amazon, we decided to add the flat shipping cost to our item price (what is considered offering “free” or “included” shipping) and then offer an additional option of Expedited Order which meant we would process the order by the next day (we do custom items) and then ship USPS Priority Mail Flat Rate envelope for an additional cost to the customer.
The way we have done this has kept our profit structure the same on both venues and met the expectations of the different customers that each venue attracts.
Summary
In the end, our pricing is fair … our shipping fees are fair … and our customers appreciate the service we give them. Our customers don’t say our items are cheap and they don’t say the items are expensive. Our customers do thank us for the service and communication we deliver with each order. We achieve this on both venues operating differently when it comes to shipping fees.
As to why Amazon (or even us on our own site) would not set up the zone shipping to be exact from each ship from location to each ship to location … this would be best explained by comparing gear types. Being exact would be like having a gear with many fine teeth to make the process work. If any one tooth of that gear broke (had an issue), it could bring the entire process to a halt (break it). On the other hand … if you create a broader group to work with, then the gear would have less teeth but larger teeth, those teeth would be stronger and less likely to break thus creating a more reliable process.
Agree
Agree
And from our 50+ years in retail … we have learned that there is value in keeping things simple and learning that it is okay to go with the flow at times. There will always be problems. Find the solutions that work for you. Relax and have fun with the different challenges that come with retail.
You can even work in combined s/h for multi item single cart purchases. I would take up Roxy’s offer for help also. I have many years experience with the shipping templates and only need a couple for what I sell. People love combined s/h charges especially with the multi-item % discount I offer. Sales are slow right now but I expect they will pick back up soon as the kiddo’s all get back in school. I only did FBA for about 5 years out of my 22 years on here and will never go back to FBA.
I think @packetfire was just surprised to discover that Amazon, unlike nearly every other retailer on the planet, doesn’t tie their shipping into the carriers’ systems for real-time price and transit quotes. You can’t really blame him, Amazon does a good job of convincing the public that they are a technology leader with cutting edge innovation.
Those of us who know better can forget what a shock it is for someone to discover this for the first time.
Completely agree with first statement. The conflict for business owners is figuring out where/when we do actually have “control” and then mitigating loss and liability when we do not. But we accept the niggling inconveniences and injustices when we decide to operate.
As to the second…one of my favorite SNL skits, parodying what a truth-filled vacation company advert would include if they could. I assume it was based on actual online reviews of travel services!
It’s like folks shopping for a house who complain about paint colors.
Yeah, and its gonna take me a bit to adjust to their non-zoned shipping template after decades of using the raw post office zone matrix and calculating shipping from zip code to zip code, like anyone would do.
