Truth in shipping


With many online retailers offering free shipping on every order, consumers have arguably come to expect free (or at least low-cost) shipping for all their purchases on the web. Of course, not every retailer plays this game. Some still charge full price for shipping. This seems especially common with clothing stores and others who sell a unique product you can’t get elsewhere. As they see it, there’s no business reason to pay for shipping costs if customers are going to buy anyway. I can’t fault them for that logic. But what really bothers me is when they charge shipping rates that are two or three times the actual cost.

You’ll probably recognize this scenario: You’ve filled up your shopping cart with say $50 worth of products. When you go to check out, the shipping cost appears, and it’s something absurd like $13 — almost 30% of the cost of the items. Why am I calling this absurd? Well, the products in question usually weigh a measily one or two pounds, clearly in the $5 territory for anyone with decent shipping volume. So what’s the rest of the shipping charge for? I’d argue it’s just hidden profits.

Don’t get me wrong: these stores have every right to make money. But it bothers me when they try to make the products look cheaper by burying the rest of the costs in the shipping. To this end, I propose a “truth in shipping” disclosure for online and catalog retailers. How would this work? Basically, whenever the price they’re charging for shipping is more than say 25% higher than their actual shipping and packaging costs (or some industry average based on weight), they would have to tell you about it. Of course, I don’t expect this will ever happen. All I can hope is that the free market will punish those who continue to charge outrageous shipping costs, instead of just pricing their products fairly in the first place.