If free shipping, what will they earn?

Discussion in 'Growing and Managing a Business' started by soundler, Jan 27, 2011.

  1. soundler

    soundler
    uix_expand uix_collapse
    New Member

    Joined:
    Jan 27, 2011
    Messages:
    1
    Likes Received:
    0
    Recently I knew that sourcingmap.com (online store) is doing a discount activity by offering free shipping for all their products from 21th,Jan to 10th,Feb. Generous enough. I used to buy some items from Ebay and Amazon, the postage always cost me a little more or less. When I look the prices of the products, I was surprised. Some products were even cheaper than Ebay or Amazon’s.
    It was crazy, I know sourcingmap’s products are from China factory, the product will be cheap, while they charge free postage, how much will they earn? The profit margin is so less. I was wondering is this actually sourcingmap return to their customers?

    Anyone knew this? Pls leave me some information.

    If this is really true, I guess both internet user and its competitors will be crazy.
     
  2. GekiDan

    GekiDan
    uix_expand uix_collapse
    Active Member

    Joined:
    Jun 11, 2009
    Messages:
    2,594
    Likes Received:
    218
    Welcome to the forum soundler. Thanks for posting your questions here.
    Basically, free shipping have slower transit and might arrive, depending on the origin and your location, from 15 days to two months.
    This type of shipping is Subsidized Air Transport and tracking numbers is not available.

    And since they are from Hong Kong, they seem to have the lowest international shipping cost, and the slowest shipping method.

    Most of the time, the shipping prices are included in the base price that you will need to pay for.
    Or if you are in the same region.
     
  3. Fergal

    Fergal
    uix_expand uix_collapse
    Premium Member
    Premium Member

    Joined:
    Nov 18, 2007
    Messages:
    10,578
    Likes Received:
    1,163
    It's very difficult to compete with established sites such as eBay and Amazon, they are extremely well established and trusted by online shoppers. Offering free shipping is attractive, because it represents a good saving for the buyers. The site you mention, appear to be offering free shipping for a limited time in order to win first time business and increase awareness of their online store. They may even be losing money on those sales, but are prepared to bear that lost initially and view it as a cost of promoting their site.
     

Share This Page