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Free Shipping is a Lie

Posted by on Nov 8, 2016

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We all love the word free, even when we know there is no such thing in business — it all comes at a cost.

The cost of free shipping can be especially onerous for smaller e-commerce companies, but it’s even impacting Amazon and Target, two of the giants often considered responsible for popularizing the trend to begin with. Typically, Amazon recovers only about 55% of the amount it spends on shipping, a number that has drawn new scrutiny after the company’s third-quarter earnings significantly missed expectations. As it expands its Prime service and other recent offerings, Amazon’s net shipping costs—the difference between what it pays for shipping and the amount customers pay in shipping fees and Prime memberships—reached nearly $1.75 billion in the third quarter, its highest quarterly total ever outside of the peak holiday season, according to data compiled by GeekWire from the company’s earnings reports.

For more, follow the Via link below.

 

Photo credit to Craig Sunter/Flickr

via https://www.fastcompany.com/3061686/free-shipping-is-a-lie

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