Big O Posted August 27, 2012 Share Posted August 27, 2012 For instance, I'd like to get a 36 ounce of DS but shipping is $8-9. No need for any other items right now so it'll just have to wait. No dealers nearby either. Only one in this area is almost an hour away. My closest is the warehouse at 6 hrs away. I guess nearby is a relative term Link to comment Share on other sites More sharing options...
Adam Posted August 27, 2012 Share Posted August 27, 2012 Friends, this is a great thread, and great insight into how you feel about shipping charges. True, offering free shipping, or flat rate shipping would mean that some products would have to have a price increase, especially gallons and 5-gallons. As it sits, year to date 2012, we have paid about $63,400 more in shipping charges than we collected. That means we are not over-charging for shipping currently, and actually, subsidize shipping on a good portion of the orders. If we were to bump prices, maybe 5 to 8%, and offer a low, flat rate shipping, say $7.95, would you find that agreeable? Our average shipping cost per order is about $12.50. Others have mentioned that we are getting rich on shipping, and in fact, the opposite is true....still, I like going to a website and knowing how much shipping will be before ordering. It removes that objection immediately, and that would lead to stronger numbers of people checking out of their shopping carts online. Loving your input friends, and please, keep it coming! -Adam:thumbsup: Link to comment Share on other sites More sharing options...
Big O Posted August 27, 2012 Share Posted August 27, 2012 Therr it is in black and white Link to comment Share on other sites More sharing options...
MAYBEN Posted August 27, 2012 Share Posted August 27, 2012 As it sits, year to date 2012, we have paid about $63,400 more in shipping charges than we collected. That means we are not over-charging for shipping currently, and actually, subsidize shipping on a good portion of the orders. wow, thats a big number! I appreciate you sharing that with us, it's not common for these numbers to be shared.. Link to comment Share on other sites More sharing options...
Kustom_FX Posted August 27, 2012 Share Posted August 27, 2012 I receive a LOT of product at my store from UPS and others and I can tell you for certain Adam's is not making any $ on shipping. I just got in a Y-pipe that cost the customer $42 for the part & $58 for the shipping! I had ZERO up charge in that! I never even look at the shipping costs when I place my orders anymore.. I know what I want, and I order it.. I have a great relationship with this company and have ZERO complaints.... Thank you Adam for the great products and service and candid disclosure of sensitive company financial date. There will always be Adam's products in my garage and on mine and my customers cars. Link to comment Share on other sites More sharing options...
DaveVY Posted August 27, 2012 Share Posted August 27, 2012 Thanks Adam for sharing that information! One item to consider in whether to raise prices 5-8% in order to have a flat rate charge is what is the overall distribution strategy. Is Adam's going to focus on having direct consumer sales that are placed directly through corporate headquarters? Or is strategy going to be focused on in person/show sales or dealer sales? If prices are raised 5-8% then when purchases are made in person at a show, from a dealer or directly from Adam's HQ then the price would be inflated by that 5-8% despite the fact that shipping is not needed. If Adam's raises prices 5-8% then they are betting on direct internet sales to consumers and, unless they change pricing for dealers, will potentially slow down dealer/network growth. If Adam's didn't pass the 5-8% increase along to the dealers than dealers would have better margins to work with which could enhance the opportunity for the dealer to grow. Just some random thoughts on the subject. Link to comment Share on other sites More sharing options...
Adam Posted August 27, 2012 Share Posted August 27, 2012 Great points! At this point, approximately 70% or our sales are direct to the end user/enthusiast. About 20% of our sales are through resellers, and roughly 5% are bulk and/or private label. The last 5% of our sales are done at shows, where we typically offer a show discount of 10%. (Shows are a marketing expense, and one day we hope they break even!) Our goal is to grow this little business and show a modest profit, yet it seems shipping is quite the hurdle! Some of our dealers are doing a great job, and we do things to help them succeed, like cover show entry fees, send staff to shows and clinics, give samples, donate to their charities, etc. You are likely aware, we are a small company, and can be flexible with each of our dealers, making adjustments to each on an individual basis. I typically have a, "Ask....and you shall receive!" policy with our dealers. Link to comment Share on other sites More sharing options...
Feets31 Posted August 27, 2012 Share Posted August 27, 2012 You just give a 10% off at shows discount and that would take care of the increased cost and still allow the flat rate shipping. Working with dealers would be a different pricing structure anyways. Link to comment Share on other sites More sharing options...
CaptainChet Posted August 28, 2012 Share Posted August 28, 2012 Friends, this is a great thread, and great insight into how you feel about shipping charges. Loving your input friends, and please, keep it coming! -Adam:thumbsup: For me, the BEST thing is that when the customers speak, the company listens! Often (and being in the airline business listening to the customer [passengers] is a rare commodity). I know now that Adam is listening to us and sharing his thoughts and problems. While we all have an opinion, the ultimate solution is one that has to make economic sense for the company and for the customer; very difficult to do. My suggestion might be along the lines of shipping charges based upon a scale based upon the total order amount with the occasional special thrown in every now and then. For example; Order Amount: FedEx Ground -----FedEx2nd Day----- Overnight Up to: $49.00 -----$8.95 -----xx.xx ----- xx.xx $100.00 -----xx.xx $150.00 -----xx.xx $200.00 -----xx.xx etc. etc. The advantage of this to both the company and the customer: For the company is that it encourages orders to go a buck or two over the next shipping break point and to the customer is to know that the more I order, the better the shipping rates becomes. It's sort of a win-win situation for both. The shipping charges and price levels is something that Adam's has to work out based upon knowledge of the weights of products, packing materials and labor costs, etc. etc. etc. Of course, certain special items have to have a special price for shipping. Unusually heavy, or bulky items that require extra packing/handling. I mean if you decide to sell lead bricks for $1.99 each, $40.00 worth might weigh 300 pounds and $7.99 shipping would not be prudent business decision! Joking of course, but I know you get the idea. A wise man one said "This is not a money problem, but an idea problem" Thanks for listening to us Adam!!! Link to comment Share on other sites More sharing options...
Mark L Posted August 28, 2012 Share Posted August 28, 2012 Major props to Adam for sharing that information. I, for one, am all for the price bump with a flat rate shipping charge. I think the problem is FedEx and UPS, they're way too expensive if you ask me. When I sell stuff, I ALWAYS ship USPS, never have had a problem and it's waaaaay cheaper than the private companies. However, I can understand why Adam's uses FedEx, as it's trackable and that is needed with the multitude of orders they fulfill. Link to comment Share on other sites More sharing options...
goheels Posted August 28, 2012 Share Posted August 28, 2012 Truly amazing to have the owner of a company listen to the customer and respond directly. I certainly did not know how much money was being lost over shipping for the business. That being said, there has to be a more economic way of lowering the cost of small weight/size items so that the shipping does not equate to 35+ percent of the cost of the product itself. Hopefully people can offer some ideas other than raising prices as a solution to this problem. Link to comment Share on other sites More sharing options...
koebot Posted August 28, 2012 Share Posted August 28, 2012 I don't mind paying the current shipping charges for larger items/orders. For me, it's when I only need a couple of smaller items when it becomes a deterrent. Link to comment Share on other sites More sharing options...
Feets31 Posted August 28, 2012 Share Posted August 28, 2012 One thing I thought about was being able to stockpile the daily and weekly specials and buy all at once. this should save on shipping costs to the customer. However, I often add and subtract items several times sometimes over several days, so I am not sure how you make me commit to something and then buy it at the end of the week. It would likely be a nightmare in the billing software and for the online chat help. I think it would be a great selling option and would allow me to buy several smaller items with a cheaper shipping rate. But I am not sure how you do it and not make it a billing nightmare. Maybe you have a Monday item Tuesday item and Wednesday item. On Thursday the Monday item goes away and the Thursday item is added. On Friday another item is added and the Tuesday item is eliminated. After Wednesday of each week the customer has the chance to buy 3 different items at the special price. Maybe the Monday item gets cheaper on Tuesday and even cheaper on Wednesday. But there are also only so many available. Link to comment Share on other sites More sharing options...
MAYBEN Posted August 28, 2012 Share Posted August 28, 2012 One thing I thought about was being able to stockpile the daily and weekly specials and buy all at once. this should save on shipping costs to the customer. However, I often add and subtract items several times sometimes over several days, so I am not sure how you make me commit to something and then buy it at the end of the week. It would likely be a nightmare in the billing software and for the online chat help. I think it would be a great selling option and would allow me to buy several smaller items with a cheaper shipping rate. But I am not sure how you do it and not make it a billing nightmare. Maybe you have a Monday item Tuesday item and Wednesday item. On Thursday the Monday item goes away and the Thursday item is added. On Friday another item is added and the Tuesday item is eliminated. After Wednesday of each week the customer has the chance to buy 3 different items at the special price. Maybe the Monday item gets cheaper on Tuesday and even cheaper on Wednesday. But there are also only so many available. that kind of defeats the purpose of a Daily Special.. the D.S. is for that day and that is the special pricing, if you were to stack them, it would be as if it was a big sale on many items.. the Daily Specials bring lower margins to attract buyers to purchase, 9 times out of 10 the customer will buy another item.. Link to comment Share on other sites More sharing options...
Feets31 Posted August 28, 2012 Share Posted August 28, 2012 Maybe you buy the privilege like at Amazon and pay $ each year to be a part of it. You agree to a certain day of shipping. Say Wednesday is historically the slow shipping day of the week, so you get to package two specials of the week and it will be shipped on the next Wednesday. If you needed something quick you would not use this feature and would do business as usual. Maybe you have to buy Monday's special to get Tuesday's special at a certain price. Or maybe we are working too hard, willing to spend more Money to beat the $8-$9 automatic starting point for shipping any item. Link to comment Share on other sites More sharing options...
LFairbanks Posted August 28, 2012 Share Posted August 28, 2012 (edited) I think alot of the issues associated with shipping charges is the cost of fuel. Just last week it cost me $125 to fill up my personal vehicle. I can only imagine what the fuel bill is like for a company like UPS or FedEx that has several thousand vehicles. Lets also not forget about the cost of electricity to move those belts. Twenty years ago I was curious what the electric bill was where I worked. The building was half the size it is now. I was told for that building it was $50,000 for a month. I have always been a believer that you usually get what you pay for. UPS and FedEx both have excellent tracking systems. All this technology cost's money. Here is a video I found a while back that shows some of the technology involved in moving packages. It may give some insight into shipping cost's. [ame=http://www.youtube.com/watch?v=JZu_gxi3sbs]Fedex and UPS Documentary - YouTube[/ame] Edited August 28, 2012 by LFairbanks Link to comment Share on other sites More sharing options...
Vink70 Posted August 28, 2012 Share Posted August 28, 2012 I just wish that the smaller items. like single items wouldnt be nearly as bad. But I do 100% understand where they are coming from for sure. Just means I have to wait to order the single smaller items until i need things in bulk. Link to comment Share on other sites More sharing options...
Team Adam's Posted August 28, 2012 Share Posted August 28, 2012 Energy costs (fuel, electricity, etc) all play a huge role in shipping prices... obviously as gas prices rise, so does their overhead, and as companies tend to do that cost is then distributed out to the end users. Link to comment Share on other sites More sharing options...
ironzgti35 Posted August 28, 2012 Share Posted August 28, 2012 Maybe I missed it but why is FedEx the only option? UPS and USPS packages can use tracking numbers, just like Fedex. Link to comment Share on other sites More sharing options...
Feets31 Posted August 28, 2012 Share Posted August 28, 2012 Multiple companies would probably lead to extended shipping time, misdirected packages and higher costs to sort packages. I think what we are really asking for is a better way to hide the shipping costs from ourselves so it is not looking us in the face each time we order. I imagine each of us has a comfort point of where we want the cost at when we order. So instead of a psychiatrist we want Adams to hide the true shipping cost from us so we feel better when we order. Link to comment Share on other sites More sharing options...
Adam Posted August 28, 2012 Share Posted August 28, 2012 Multiple companies would probably lead to extended shipping time, misdirected packages and higher costs to sort packages. I think what we are really asking for is a better way to hide the shipping costs from ourselves so it is not looking us in the face each time we order. I imagine each of us has a comfort point of where we want the cost at when we order. So instead of a psychiatrist we want Adams to hide the true shipping cost from us so we feel better when we order. True on the first sentence, we get up to 50% off our FedEx rates by having solid volume. As for the second paragraph, that's a fairly blunt, but fair statement! Link to comment Share on other sites More sharing options...
ArmyAcadia09 Posted August 29, 2012 Share Posted August 29, 2012 Maybe I missed it but why is FedEx the only option? UPS and USPS packages can use tracking numbers, just like Fedex. I'll probably have Mook kickin my shin next time I see him, but I believe they left UPS due to lots of people getting beat up boxes and having issues with the receiving aspect. Just what I think I remember. Link to comment Share on other sites More sharing options...
THE Mook Posted August 29, 2012 Share Posted August 29, 2012 There are more than a few reasons we use FedEx, but accuracy, lack of damage, and customer service are supreme for the volume we do. Link to comment Share on other sites More sharing options...
Chewy Posted August 29, 2012 Share Posted August 29, 2012 Friends, this is a great thread, and great insight into how you feel about shipping charges. True, offering free shipping, or flat rate shipping would mean that some products would have to have a price increase, especially gallons and 5-gallons. As it sits, year to date 2012, we have paid about $63,400 more in shipping charges than we collected. That means we are not over-charging for shipping currently, and actually, subsidize shipping on a good portion of the orders. If we were to bump prices, maybe 5 to 8%, and offer a low, flat rate shipping, say $7.95, would you find that agreeable? Our average shipping cost per order is about $12.50. Others have mentioned that we are getting rich on shipping, and in fact, the opposite is true....still, I like going to a website and knowing how much shipping will be before ordering. It removes that objection immediately, and that would lead to stronger numbers of people checking out of their shopping carts online. Loving your input friends, and please, keep it coming! -Adam:thumbsup: Now I know you're growing... If memory serves, that's a considerable increase from last year... I think we had $750,000 dollars in freight and UPS charges last year between our own store locations. The cost of shipping has gone up CONSIDERABLY in the last few years. Fuel prices play a large part in that. Link to comment Share on other sites More sharing options...
camaro2ssblack Posted August 31, 2012 Share Posted August 31, 2012 (edited) I certainly appreciate the comments and feedback from Adams regarding the shipping prices. I am in no position to question their loses on shipping but all I know is that other companies ship the exact same product, for the exact same price, in the exact same condition for a low flat rate or free for orders over $99. Your talking about significant savings on every single order, and IMO that cannot be ignored... Again, I appreciate the fact that we are able to have this discussion openly with the owner to reach an understanding on both sides of the coin. And no matter who you get it from, Adams FTW Edited August 31, 2012 by camaro2ssblack Link to comment Share on other sites More sharing options...
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