99p delivery charge… from Hong Kong!
I bought something on eBay yesterday. Not exactly an unusual occurrence, I buy lots on eBay, but this time I chose to make the purchase from a seller in Hong Kong.
The item wasn’t particularly expensive, but it’s light in weight. eBay’s Best Match search algorithm did it’s normal trick of surfacing the cheapest deals to the top but the top result had a postage cost of £2.50. I’m not particularly surprised at that bearing in mind Royal Mail’s recent postage increases. Business postage rates kicked in earlier this month and the consumer price tariff increases as of tomorrow.
The second search result gave me a slightly cheaper buy it now price but the postage was only 99p. That’s the one I purchased but (and it’s a big but) it’s shipping from Hong Kong!
How can it be cheaper to ship an item half way around the world than it is to ship it from the UK? If a realistic UK cost to deliver is 250% times the cost to deliver from within the UK something has to be wrong. The seller isn’t loading the item price either – it was a £1.99 item cost with 99p delivery charge so the total was only £2.98.
Shipping costs are going to start hurting UK sellers. It doesn’t matter if you offer free postage, incorporate some of the postage cost into the item price or simply charge the full amount of postage plus VAT that it actually costs you to deliver if your competitor in Hong Kong can ship at 20% of what the delivery will cost you.
Quite honestly I don’t know how it’s possible to pay for a jiffy bag, processing and delivering anything from Hong Kong for £2.98 and still make money but as a buyer that doesn’t bother me. What does worry me is how I’m going to be able to compete with those sorts of prices unless I myself relocate to Hong Kong.
Clarky says
11:05 am on 30/04/2012
Assuming the item in question is light, you can post a 50g letter from HK to UK for £0.27
See here: http://www.hongkongpost.com/eng/postage/overseas/bulk/index.htm
I bought a stopwatch a few months ago for £1.98 including postage from HK and wondered the same thing.
If you have a play around you find the heavy parcels work out quite expensive but the lightweight ones (That RM have screwed everyone on but are still delivered by them for our HK friends) are ridiculously cheap.
Chris Dawson says
11:22 am on April 30th, 2012
So you can post for about 50% of the UK cost from Hong Kong then! That’s just wrong on all levels including the environment!
Clarky says
11:25 am on April 30th, 2012
Yup, the worst part for me: From the moment it lands to the point of delivery guess who delivers for this incredibly low price – Royal Mail!!!
It would appear that we are subsidising incoming Airmail…
ebuyerfb says
11:24 am on 30/04/2012
You don’t compete on price. You compete by offering your customers less hassle if the product doesn’t work, delivery times that are about 20x faster, and providing customer support where you speak the same native language as them.
Clarky says
11:28 am on April 30th, 2012
It depends on the product and timescale of the customer. In my example I didnt need the product particularly quickly, if it went wrong then it was £2 wasted and the nearest comparable product in the UK was £5, Service and speed do not really matter unless the product is a) expensive or b) needed quickly.
Godotcloud says
11:48 am on 30/04/2012
I’m a seller from HongKong so that may be i can answer your question.
Our post office have a service specifically for ebay sellers with volume orders(for those who delivery thousands orders per day),we call it HK small parcel. It cost about £5 per kg,without tracking number,no processing fee.For light weight packages such as jewelries or watches, 1 kg can be about 20~30 parcels.
For sellers with low quantity to deliver,they just send their package to the those big seller or agent,and paying higher postage (about £9 per kg).
Yes the price is low enough,but please note that it takes about 14 days or longer to arrive destination.And as there is no tracking number, package lost happens often.
Chris Dawson says
12:03 pm on April 30th, 2012
Hey thanks so much for this insight, really interesting to know what the postage rates from overseas are
Sounds like you guys in Hong Kong have got a really helpful (Low cost!) postage option
Godotcloud says
12:16 pm on April 30th, 2012
I think the main cost difference is the “tracking service”,We can also ship those small parcels with tracking number,but the price is quite different: they cost £11 per kg and we need to pay additional £1.2 processing fee for each parcel.
I guess that if Royal Mail also provide a “BULK service” without tracking, maybe they can also provide similar price for you.
St-georges-dragon says
12:20 pm on April 30th, 2012
Royal mail contract price is very similar to HK ,the big differance for us is that their is not that much call for bulk shipping to Hong Kong
Clarky says
12:25 pm on April 30th, 2012
The per kilo price is about the same but the per item part is well over the HK price. ISF is a joke price wise in comparison.
JD says
12:28 pm on April 30th, 2012
Therefore more room on the plane? Therfore less expensive?
St-georges-dragon says
1:01 pm on April 30th, 2012
does not make the distance any shorter however much room there is?
as any courier or transport operator will tell you, running empty is not cost effective
JD says
11:55 am on 30/04/2012
The latest RM prices are really hurting small exporters the most.
50% of my stuff goes overseas and what comes in from HK for a few pennies will now cost £3.30 to return at small packet (stamps) price.
RM gets that for a quick sort, a trip to Heathrow and loading onto a plane. No delivery needed.
peach says
12:39 pm on 30/04/2012
Doesn’t make much sense at all because Royal Mail still handles the delivery with all related costs to it.
St-georges-dragon says
1:59 pm on April 30th, 2012
its a postal union thing they all deliver each others mail
JD says
12:15 pm on May 1st, 2012
And as we have seen in the case of China / Hong Kong a cheap mail price for exports is very good for the ‘local’ economy.
In allowing RM a totally cavalier attitude to international small packet pricing the government must have had a blind moment.
Or perhaps fitting RM up for privatisation is more important than the LARGER economy.
Liz says
1:03 pm on 30/04/2012
I enjoy lots of nice free postage from Chinese sellers and in 5-6 years of buying from China nothing has been lost and can arrive in 7 days (quickest 3, I didn’t quite believe it)
Even postage from Japan (the most expensive country in the world) is much cheaper. I can get a 800g kimono in 2 days fully insured for (£15) or if I am feeling cheap 7/10 days for £5.
Doomed we are. Doomed.
Jimbo says
1:56 pm on April 30th, 2012
Liz your blog is throwing up some kind of security warning.
Liz says
4:26 pm on April 30th, 2012
Thanks, looks like I was recently attacked. Sorted now though!
Gerry007 says
2:36 pm on 30/04/2012
.
I have been surprised how many sellers on ebay UK, have so far not upped their P&P costs, today.
They will certainly either be sending at a loss or near it, unless their charges are already silly high, & they are just absorbing it.
We’ve defaulted all our P&P cost to 2nd class [at 1am today], with 1st class as an option. So far today, ALL buyers have just paid 2nd class…..
Airmail from the UK, is just silly now.
In a way, as we do not sell much international stuff, it does not effect us.
One point is that even with standard airmail prices, there is no tracking & overseas buyers expect after paying £3-5 for P&P for it to be tracked. BUT, having just had a packet from the US,with just 2 CD’s in it & the postage cost was nearly $6 [no tracking] it’s no cheaper inbound from the western world.
We buy from china [in bulk], and even when getting samples here, if you ask the supplier to get a rate from, say, DHL Hong Kong, it is always cheaper than sending the other way.
Maybe, if any tamebayers are sending lots overseas, they could look at an advert here on tamebay, ie: Eparcels, here:
http://www.e-parcels.com/
We in the west will n ever be able to compete with eastern sellers for so many reasons, mainly everything just costs less there, that’s why we all buy there.
St-georges-dragon says
3:11 pm on April 30th, 2012
we have upped our postage cost in line with price rises we are also now reluctant to carry some of the cost of postage to keep TRS discounts because of the decrease in discounts so we are off to the past in our time machine to see if the the stage coach can deliver cheaper
jim says
3:32 pm on 30/04/2012
china EMS is not expensive, They also used to do discounted rates the higher the weight.
I used too import items using this method.
The Shopkeeper says
6:49 pm on 30/04/2012
On a RM business contract low weight packages – even with low volume – are cheaper to post internationally than second class within the UK.
Quite how RM arrived at their price structure God knows!
isleman says
11:38 am on 01/05/2012
Chris,anyone who imports from China will realise that the postal charges are a hell of a lot cheaper!.
More and more people who want to buy on Ebay will buy from Hong Kong direct.
Most products trade are bought for pennies.The cost of it getting to the customer is what is killing uk sellers.
The uk postal charges just tell me that it is cheaper buy (as a customer) direct.So what if I buy 10 for the price of 1 in the UK.At least if 3 work,then I am up 300%.
Ebay will be full of chinese sellers as the years carry on.
Rant over!.