Use the formula from earlier to determine your handling cost per item: Then answer the following questions to determine the cost of S&H for any item in your inventory:
#UPS STANDARD CALCULATOR HOW TO#
Now that you have all the knowledge you need, here’s how to calculate shipping and handling.įirst, open a spreadsheet or grab a sheet of paper and number lines 1 through 4. Use it as your handling cost when calculating S&H. The result is your “opportunity cost”-the time you could have spent doing other things that would make money. Finally, complete the same formula from above: Then set the minimum amount you’re willing to earn per hour while preparing and shipping items-that’s your hourly rate. But if you have to spend 20 minutes preparing it for shipping, you’re making just $7.50 per hour-minus the value of the time you spent identifying the item, buying it, and creating the listing!įind out how long it takes you to prepare an order for delivery. When you first start selling online, you may see that you can sell an item for a $2.50 profit and think hey, that’s worth doing. If you work alone, you might think you have no handling costs. If you have employees, then you have to multiply how long it takes them to prepare each item for shipping by how much you’re paying per hour.
#UPS STANDARD CALCULATOR FREE#
To find out how to create an accurate estimate of your packaging costs, see " eBay and Amazon Packaging Costs: What to Budget." Also check out our article on the USPS free boxes program to see if it can save you money on packaging. If you’re sending something in a box, it could cost you anywhere from $0.75 to well over $5.00. If you’re sending something small in a padded envelope, you shouldn’t have to pay more than $0.50. It’s generally safe to budget $1.00 for packaging if you’re using small boxes.
To determine the true shipping and handling costs for an item, you need to add up three things: Otherwise you’ll charge too much or too little, and your sales or profits will tank accordingly. If you want to be competitive, particularly on online marketplaces like Amazon and eBay, you need a firm understanding of how to calculate shipping and handling. It’s tempting to just charge $4.99 on everything and call it a day. Shipping and handling costs can seem like a real mystery when you first start selling long-distance.
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