Shipping options; auctions vs. grading services

[Nutmeg Coin]

When I buy an auction item generally the item is shipped priority mail; that generally costs them under $6 to ship a flat mailer or $10 for a box, though more often than not I get the item(s) in a flat mailer. None of the grading companies as far as I am aware will ship for less than $20 claiming insurance regulations as the reason. Yet insurance rates through Hugh Wood or Ship and Insure are percentage based and do not amount to a great deal for items under $1-$2K. So why is it so difficult for grading services to ship certified coins for under $20? Many ebay sellers throw in free shipping, which costs all of $2.50 for first class with tracking.

[bstrauss3]

Shipping and *Handling* (which includes supplies, rent, utilities, etc.)

 

You don't think the guy or gal in the mail room works for free do you? You don't think the boxes are free do you?

 

Those bubble mailers are $20/100 or 20c each. USPS costs 2.34 - so they've already lost money w/o considering gas or time.

[RWB]

There is no such thing as " insurance regulations" related to a mailed item. It is a profit center for companies.

[Mr.Mcknowitall]

There is no such thing as " insurance regulations" related to a mailed item. It is a profit center for companies.

 

That depends on the meaning of "insurance regulations", I think. A company shipping an item may not have a business policy that covers shipping losses not insured for a certain amount. It may also refer to carrier (motor freight) coverage. As an example, you are remodeling your home. You order an item for the builder to install, as an allowance under the contract. The item is damaged. You call the shipper. Not their problem. It is carrier coverage. You try to claim against the builder. Nope. The insurance is for your account. There are Federal and State regulations concerning coverage. Once the item ships, your own insurance carrier should have been notified that you are requesting coverage, and pay for same.

 

The observation about companies/individuals that ship free, is either a loss leader for the item being shipped, or it has been figured into the cost in some manner. There is no such thing as free shipping. Somebody pays something. It is not really the profit center that that some think. Maybe the tv hawker stuff, but that is a given to some degree.

[Nutmeg Coin]

I can see a few dollars extra above costs to ship items but not considerably more. On ebay you would lose a lot of business if you charged all your costs in shipping items. It took me about a minute to package an item today, usps provides priority supplies for free. In large volume shipping items drops in cost considerably.

[Mr.Mcknowitall]

I can see a few dollars extra above costs to ship items but not considerably more. On ebay you would lose a lot of business if you charged all your costs in shipping items. It took me about a minute to package an item today, usps provides priority supplies for free. In large volume shipping items drops in cost considerably.

 

I can understand. The issue may be the way the auction houses set up their insurance coverage policies, and what coverage amounts limits are. The insurance company may well have insurance regulations that effect the cost, under an ICC reg. Large volume is not particularly the case though, in coin collecting, is it, when a singular sales event of a coin to a certain person is shipped? It is not the same person receiving the large volume. If you are per chance referring to large $ amount, that does not translate into a discount for insurance either, and is usually the opposite, in my experience.

[RWB]

The comment was made from the perspective of being required to have insurance on coin shipments by some "regulation" or "authority." Once purchased, there are various rules usually imposed by the insurer or common carrier.

[bstrauss3]

usps provides priority supplies for free

 

As we were saying a few lines up, it's not free - the non-trivial cost is built into the $5.95 shipping fee. Think about it - those boxes have to be manufactured and shipped to 1000s of post offices around the country. The stock levels at each one need to be managed and when necessary more stock shipped out. People take those boxes and use them for all kinds of things other than priority shipping.

 

And of course, the cost is heavily dependent on how you account for the costs... floor space for the priority mail box display? Who pays? General overhead or charge back to the priority mail cost line. etc.

[Nutmeg Coin]

My point was that it costs auctions, grading services and sellers nothing to ship with the free envelopes, tyvek and boxes usps provides. Ancillary supplies like cardboard boxes obviously cost grading services extra as does tape and other materials.

[bstrauss3]

And they have a shipping/receiving room with security, security cameras, insurance coverage, etc.

[bourse28]

As an ebay seller I throw in "free shipping".

 

However the price of the item is calculated to include S&H along with the cost of the item in the markup equation. There is an ebay calculator which can be found online. I would google it then bookmark it.

 

Shipping and handling is a major variable cost in any numismatic business. This includes USPS, insurance, signature confirmation (expensive items over $250),packaging costs, labor in packaging the item for shipment, transportation time to PO, etc. Variable selling expense on ebay once you consider ebay FVF, paypal, and shipping cost can easily reach 15% of sales. Being in the business I don't do any of this for free.

 

Many coin buyers have no clue as to basic accounting or what it takes to run a coin business let alone how to sell coins. In reading some of their comments in these forums its obvious some of them know nothing about shipping coins, USPS requirements or rules. There is no point in argument with them just apply overhead costs accordingly to the cost of the item along with your basic profit commission to the business.

 

[e1cnr]

I can see a few dollars extra above costs to ship items but not considerably more. On ebay you would lose a lot of business if you charged all your costs in shipping items. It took me about a minute to package an item today, usps provides priority supplies for free. In large volume shipping items drops in cost considerably.

 

 

So you can ship about 60 packages per hour? 450 packages a day?