July 1, 2016 by Andrew Minalto - 8 Comments

Do you HAVE to offer FAST shipping on eBay?

fast-delivery-on-ebay

Shipping is the biggest hassle for most eBay sellers, especially now that the Late Delivery metric has come into full effect. And with Amazon now offering SAME DAY delivery to select areas in the UK & USA, it’s really no longer a question of whether or not you need to offer fast and preferably free shipping to your customers as that’s no longer going above and beyond but simply the expected level of service.

That’s just the way the market moves and customer expectations when it comes to delivery times are at the highest level ever.

But it seems not all eBay sellers are following the trend, as I discovered from a recent email:

Hi Andrew,  
 
I want to gain some feedback from an expert.  
 
I am selling on eBay and basically I currently offer a lead time of 3-5 days for shipping. This is due to my current warehouse capacity and meeting customer expectations. 
 
But having taken a closer look at my competitors it appears that some are offering an express 24 hour courier service for larger/heavier or expensive items and on the low value items they offer a 48 hour or 2-3 day service.  
 
Obviously their postage offering is a lot faster than mine and it also appears they are selling a lot more even though they’re well priced, i.e. more expensive than me.
 
I am considering moving to a bigger warehouse in order to be able to increase my stock holding, which will allow me to offer the same level of service as my competitors.
 
My question to you is if I increased service levels & got my items posted out in the above timeframe, will eBay give me more visibility and sales? Basically are listings that offer a better service promoted?
 
I just want your input as a bigger warehouse would mean increased costs and I want to be sure it’s worthwhile.
 
Really what I’m more worried about is maintaining my current level of sales, rather than growing it, as one of my competitors who offers a higher level of service has seen a significant uplift in sales recently and I feel this will obviously affect me in the long run.
 
Please let me know your thoughts. I greatly appreciate any help.
 
Regards, 
Alfie 

Hi Alfie, 

Thanks for your email.

The quick answer is – YES! 3 days may not be that bad but a 5 day delivery timeframe really is too long if you want to be competitive in today’s marketplace, especially when you’re competing directly with sellers who offer 1-2 day delivery.

There are 2 major problems if you stick with this 3-5 day delivery time: 

  • Lower rankings for your listings in search on eBay.
  • Lower conversion rates, which even further lowers your listings’ search positions.

The first problem is obvious – Best Match algorithm (which is basically the system behind eBay’s search engine) takes into account whether you offer eBay’s Premium Service (free & fast delivery) to your buyers. If you don’t, this instantly acts as a disadvantage to you against your competitors.

The second problem with such long delivery times is that the people who do actually find your listing are going to be put off from purchasing from you for this very reason! They are simply used to much faster delivery times and many of them will purchase from your competitors as a result. IN essence, your conversion rate (sales to views ratio) goes down AND this number also affects your listing’s search position.  

So I would really recommend you re-think your strategy and start offering quicker delivery services and ideally qualify for eBay’s Premium Service badge (if you’re a Top Rated seller), which means offering:

  • 24h dispatch time
  • ONE free shipping method
  • ONE express shipping method (next day delivery)

Please note – these two methods can be different services. For example, you can offer Royal Mail 2nd class as your free option AND charge extra for RM 1st class, to satisfy the next day delivery requirement.

It’s hard for me to say how exactly this change will affect your margins as I obviously don’t have access to your figures and warehousing costs. Also, be prepared for the fact that you won’t see results as soon as you start offering quicker shipping as it may take weeks before eBay gives you a boost in search.

In fact, as you have established listings with a presumably lower conversion rate than your competitors, it will take some time for that number to increase and even out, so while I highly recommend that you do switch to faster shipping methods, don’t expect a huge increase in sales overnight.

But you shouldn’t be worried about a decline in sales, no! There’s no way that by offering a BETTER service to your customers you’ll get less sales. So don’t worry about that! It can only get better once you switch. Of course if you stay stagnant and don’t upgrade your levels of service, then your sales will naturally deteriorate over time…

Also, I’m not sure how exactly the warehouse size affects your shipping time? I mean – if you have items in stock for immediate dispatch, simply send them! Dispatch orders ASAP! Maybe you can do some optimisation within your warehouse/fulfilment process so that you can offer quicker delivery times using your current premises? Personally that’s what I would start with, before investing more money in a bigger warehouse.

Okay, that’s it for today. If you want your question to be featured in a future Reader’s Question post, then get in touch with me via my Helpdesk here. I will personally answer ALL inquiries and the best ones will be selected for our future Friday posts!

Have a great weekend everyone! 
 
Andrew 

8 Comments
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  1. John Edwards

    My takeaway…

    ” So I would really recommend you re-think your strategy and start offering quicker delivery services and ideally qualify for eBay’s Premium Service badge (if you’re a Top Rated seller), which means offering:

    24h dispatch time
    ONE free shipping method
    ONE express shipping method (next day delivery)

    Please note – these two methods can be different services. For example, you can offer Royal Mail 2nd class as your free option AND charge extra for RM 1st class, to satisfy the next day delivery requirement.”

    Topshelf Mr Minalto…this has gone onto my formula notes…thanks again John.

    1. Andrew Minalto

      You’re welcome John! 🙂

  2. Hi Andrew

    I dispatch my orders with royal mail second class, hermes and interlink. I have no problem with hermes and interlink because i can track them and delivery time is also fast. But problem with royal mail is I cant track. For single item order i cant afford to send with hermes. I read somewhere that to be a TRS I need to enter tracking code on ebay how do I do that with royalmail second class? How other top rated sellers managing their orders with royal mail second class? I see many top rated sellers selling their item in very cheap price.

    One more thing i want to ask. Orders i get after 2pm on friday, I dispatch on monday only. Is this ok? Are other top rated sellers also doing same? Can you advice please?

    1. Andrew Minalto

      Hi Sophie,

      Thanks for your comment.

      Why you say you can’t send tracked via RM 2nd class? You can! It costs extra but just like with 1st class, you can get 2nd class parcels signed for, with the tracking number:

      http://www.royalmail.com/personal/uk-delivery/signed-2nd-class

      As for dispatching late Friday + Weekend orders on Monday – yes, of course, this is perfectly fine. Most sellers do it this way.

      Thanks,
      Andrew

  3. i agree with the delivery times, as an ebay buyer, i would rather pay that little bit extra to get my items quicker. I wish you all the best

    1. Andrew Minalto

      Thanks for your comment Jane! 🙂

  4. Hi Andy,

    Would you recommend offering free shipping on our ecommerce sites also? Is this what you offer on your own sites as people do seem to like the simplicity of the price they see is the price they pay rather than clicking on checkout to see postage costs.

    We have charged shipping on our website and even though our prices are slightly cheaper than ebay even with the shipping charge included we still get customers from ebay checking out our website and saying we look more expensive because of the fact we charge for shipping.

    It seems rather than them actually going to checkout where it calculates the shipping (set fee per order) for them they assume because we say shipping costs in our headder that we are more expensive than ebay and get people complaining.
    I’m thinking of scrapping shipping totally and just inflating item prices is this the model you have on your shops and has this worked better in converting for you?

    Thanks
    Mark

    1. Andrew Minalto

      Hi Mark,

      Yes, I would. But with a twist.

      Offer free shipping on your online shop for orders above certain amount – e.g. depending on what you sell, how much it cost, how much is average order size it could be anywhere from £10 to £100.

      But of course, you could, to keep things simple, offer free shipping by default. Only this way you lose that initiative to increase your average order value (as many people will add more items to basket just to get that free shipping).

      Ideally test both scenarios to see which one works best in your market.

      Thanks,
      Andrew

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