What shipping method are eBay sellers using?

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kreative-labs
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31 Jan 10 10:09:56 pm
I am so confused with shipping on some items on ebay like this item# 260513805054, the item cost $2.38 free shipping... adertises standard flat rate shipping...but the cheapest flat rate is $4.90 theres no way they can be sending flat rate. What shipping method do you think is being used to ship the item at a low low price and still make money off there listing???


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dwmgoods35
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31 Jan 10 10:15:24 pm
hmmm I checked out the product...Im kinda confused too. The only thing I can think of is this guy must be buying these in large bulk and each one but me like $1 or something. I really don't know how hes making money doing this. He may just be selling this at a loss to get more traffic to his other products that are selling to make him a profit. Some sellers use this strategy.

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dwmgoods35
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31 Jan 10 10:19:43 pm
I found his supplier...Check out the link below. I think its the exact product too!


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kreative-labs
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31 Jan 10 10:22:16 pm
but even getting them at $1.00 how is he able t ship it and cover ebay fees,paypal fees and still make money?


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dwmgoods35
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31 Jan 10 10:32:18 pm
lol yeah thats the million dollar question. hmm unless this guy is the actual manufacturer I don't know how hes making money...usually bigger companies have corporate account but do you see anything in the shipping section on ebay of any handling fees? that may be a way hes bagging some buck.

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fudjj
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31 Jan 10 10:57:39 pm
Not sure of the product, but I sounds like a loss leader set-up to me. He could be just cutting the throat of a competitor on sale price and on shipping, just to take his market, then he is playing on generating other sales with where he can make margin on the extra generated traffic.

It's a proven marketing tactic, and one that can be extremely effective at taking you competition out, but it can come down to how deep your pockets are at times, especially if the loss leaders aren't generating the anticipated rise in over sales from the increase in traffic.

It works like a all you can eat buffet lol

There is always a selection for you, most are cost effective for the seller, but there is usually a few dishes that aren't. You will always get some going and filing up on the big dishes, and the seller takes a hit on these customers.

Where he makes his money is on the averages, where most people will choose a selection of the more profitable food options.

Crazy analogy I know, but when you throw up a loss leader strategy, you'll always lose money with some customers. Some just snapping it up and running, while other stay and grab something else, or at least come back to shop with you again later.

You are hoping that the averages work in your favour!

Of course if we are talking about an inexperienced seller here, he could just well have no idea and be losing cash hand over fist lol


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kreative-labs
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1 Feb 10 01:21:53 am
hmmm so there are ALOT... of people selling the same product on ebay anywhere from $1.93-$5.00 free shipping could they all be doing the same technique?


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fudjj
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1 Feb 10 01:50:50 am
Drop in some links for them, I'll take a quick look


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kreative-labs
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1 Feb 10 02:04:46 am
380193570820 200433744023


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fudjj
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1 Feb 10 02:23:41 am
Well I really have no idea what that would cost to send in the US, but they may well be getting heavy shipping discounts through high volume being large power sellers, so the shipping, and perhaps a small margin could be in that price.

Depending on the popularity of the product, it still could be a loss-leader strategy, each countering the others moves to maintain their market share.


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kreative-labs
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1 Feb 10 02:35:19 am
what would be better for an average joe, to go flat rate and higher price of item, or go to usps and get shipping price to address of buyer?


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fudjj
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1 Feb 10 03:01:01 am
Unfortunately that can be a suck it and see type scenario. Everyone has their preferences, I would suggest testing the market by running an off-branded account to selll against yourself. Everything identical, just different shipping strategy. That will give you very reliable data to develop your final platform on.

Once you decide on your platform, monitor it constantly. I monitor everything daily when it comes to ebay. If a competitor makes a move that threatens my business, I counter it the best I can to limit any damage straight away, then consider putting one back across their bow as a warning shot.

If a new seller is trying to gain market share behind me, I'll do whatever I can to cut them off at the ankles, and running from ebay as fast they can run if I perceive them as a threat.

The really scary thing, there are thousands like that on ebay all doing the exact same thing, so you need a very solid platform to get yourself established, and you need to monitor everyone around you as much as you can to make adjustments where you need to if you possible can.

It's actually a really good idea to map our a range of strategies for a range of different scenarios. I know, I sound paranoid.....they're coming to get me lol. I look at it like a game of chess, you are always trying to work out where the opposition is going to be 7 moves ahead of where they currently are, and then develop your own strategy to combat them : )

Strangely enough, I've now managed to sew both food and chess into this thread lol, not bad considering it's about shipping : )


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