Having been in the mail order business many years ago, I can tell you that shipping charges ARE a "profit center". The overcharging is deliberate and is designed to help make up for underpricing your merchanidise. Some quick & simple math will illustrate (and believe it - this is deliberate):
Average order: $100 Average shipping charge: $10 Average overchage on ship: $5 Average profit increase per order: 5% And when you are working in a business that generates average EBIT (earnings before income tax) of 15%, adding 5% is a whopping 33% increase in profitability!!!! Remember: All shipping charge excess drops instantly to the bottom line (that is, EBIT). The most egregious abusers are ebay "merchants" but NPD and the rest are a close second. The profit is so easy and so sexy the vendors just can't resist. Craig Ellis, CPA (I am and it's true) -----Original Message----- From: [EMAIL PROTECTED] [mailto:owner-chevelle-list@;chevelles.net]On Behalf Of Dave Corgill Sent: Friday, October 18, 2002 2:10 PM To: [EMAIL PROTECTED] Subject: Re: [Chevelle-List] Re: Ground Up follows trend At 07:55 AM 10/18/2002 -0400, you wrote: >In a message dated 10/17/2002 11:39:31 PM Eastern Daylight Time, >[EMAIL PROTECTED] writes: > >>Since when does shipping cost have anything to do with the >>price of an item. > > >ASk OPG and Year One about that, they are the worst offenders OPG I call Oh please God (when I see the shipping charges) ----------------------------------------------------- To Unsubscribe please visit www.chevelles.net/list.html To start a new topic, send mail to: [EMAIL PROTECTED] ----------------------------------------------------- To Unsubscribe please visit www.chevelles.net/list.html To start a new topic, send mail to: [EMAIL PROTECTED]
