Will the recent Royal Mail price changes affect you?

By Sharon Fussell, March 5, 2015

I note that Royal Mail have announced their yearly increased postage charges, yet again… Of course they do this every year at this time, but I do think the price hike could have been worse.I am happy to see they are keeping their small packets prices/sizes as per the Christmas offer they introduced.

I hope they continue the small packet offer, where if it is up to 2kg in weight the postage price is £2.80.

This makes a difference for book selling, I rarely have books that weigh over 2kg, but often have books between the 1kg and 2kg bracket.

When you sell books with fine profit margins, a cost increase can break any business, especially an online business, as you do rely totally on the postage service.

Of course, for Merchant Sellers, Amazon allocates a postage credit. They did in fact increase this postage credit from £2.75 to £2.80 a few years ago, but this hardly covers the costs of fees and postage when selling low-value items.

I know Amazon will be besieged with sellers asking them to increase the postage credit, but I fear they will just urge you to ensure you price books allowing for postage charges within your profit margin.

Lately I have been selling light items, but bulky ones, so no matter what weight of the item is it has to go as a small packet, the cost of which is substantially higher than a large letter.

So how can you keep prices in check to ensure you make a profit on every sale you make?

  • Ensure that all items have a premium on the price that will easily cover postage costs and leave you with a profit.
  • Unless you are a Pro Merchant Seller, do not offer any low-priced items (1p) – and then only ever large letter size.
  • Also, ensure if you sell items on eBay that you ensure you will be able to clear a profit after fees, commissions and postage costs.
Be very selective when opting send items overseas: Amazon’s overseas postage credit is really low, unless you are sending very light items or a very expensive one that easily covers the cost and leaves you in profit!I often see items that are priced far too low: it will be totally impossible for the seller to be in profit after postage etc.

But if it makes them happy, so goes it!


What do you think?

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