If you sell products online as your home-based business (for instance in a drop ship arrangement), one decision to make is how much you will charge for shipping.
Conventional wisdom says to just charge the customer the same shipping as it costs you to have the product shipped to them. In fact, this is what a lot of online businesses do with a live shipping calculator based on weight and destination. Still others may offer free shipping on their products.
Obviously to offer free shipping, you will have to absorb that shipping charge somewhere else. That usually means figuring out an average shipping charge and adding it to the selling price. This obviously makes your item appear to be higher priced, but there can be a psychological advantage in the customer’s mind.
Many customers are very leery of shipping charges and appreciate the straightforwardness of the ‘one charge fits all’ price that free shipping offers. Others will know the shipping is rolled in there somewhere and will still compare pricing elsewhere. One disadvantage to free shipping is that it makes your prices appear higher in shopping engines such as Froogle and BizRate that allow the shopper to filter by price.
But it ultimately depends on your market and where your website shows up. You may need to test free shipping to see if you get a better sales ratio your products with that option.
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