leavings
Member
Hey everyone, as I'm preparing for the release of my album, I've been trying to decide how I'm going to fulfill orders. I was considering using an online service, but I've been looking into alternatives and I thought I would let you know what I figured out.
I found that the online services take a pretty large amount out of every cd you sell through them. For example, cdbaby.com takes $4 per disc, and cdstreet.com takes 25%. Both services also charge a setup fee, which I found was fairly standard among others in the business. Most of them also charge a high shipping fee to the buyer, which, while it doesn't take away from your profits, makes the price much less attractive to your fans. My goal was to find a method that would save me at least a buck per disc, and hopefully avoid overcharging the buyer for shipping. I found that the cost of shipping cd's on my own is far below the cost of using a fulfillment company, even taking into consideration the time committment.
I looked around and found cardboard jewel case cd mailers (you probably know what I mean) available regularly online for about 18 cents each in bulk (500 of them for under 90 dollars including shipping). There are also bubble mailers that are about 1 or 2 cents more, and are probably worth the extra money since they're self-sealing. One CD in a box or bubble mailer weighs under 5 ounces, which would cost $1.29 to send first class.
The other thing you would need is a paypal link on your site. Of course, this is assuming you already have a website. If you don't and you're at the stage where you're selling an album, then I strongly suggest you get one. Anyways, paypal charges 2.9% + 30 cents for each transaction on a standard business account. If you sell a high volume they give you a merchant account and the percentage varies between 0.7% and 2.9%, dependent on your volume. So, suppose you sell your cd for $15, the worst you could do is owe them 30 cents plus the 2.9% on $15 which is about 45 cents, so a total of 75 cents.
So, what does it all add up to...
$0.2 for bubble mailer
$1.29 for postage
$0.75 for paypal services
= $2.24
This saves you about $1.50-$2 per disc. I know from experience that it takes about a minute and a half to package and address a cd. So, suppose you're selling about 5 a day, or 35 a week. If you shipped once a week, it would take you an hour to package them and however long it takes you to go to the post office, which for me is about half an hour. I'm pretty sure you can apply postage directly to these, put them in your mailbox, and cut out the trip to the post office, but I personally like to see them put in someone's hand. All told, you end up making back about $40 an hour for the extra time you put in.
You could also charge your buyers an honest shipping price to meet your cost, and save another $1.29, bringing the total cost down to under $1. Most people will see that shipping charge is insignificant and very fair compared to what's usually paid.
Naturally, there is a lot more to consider. If you're a high volume seller, then maybe the extra money spent is worth it. Also there's the possibility of failed delivery, which is (sometimes) conveniently taken care of by a fulfillment company. The list goes on, but what I've presented is a reasonably accurate estimate of what kind of investment you can make in taking care of business on your own.
I hope this is helpful to some of you out there, and let me know if you have any further thoughts.
Peace out from Delft,
Peter
I found that the online services take a pretty large amount out of every cd you sell through them. For example, cdbaby.com takes $4 per disc, and cdstreet.com takes 25%. Both services also charge a setup fee, which I found was fairly standard among others in the business. Most of them also charge a high shipping fee to the buyer, which, while it doesn't take away from your profits, makes the price much less attractive to your fans. My goal was to find a method that would save me at least a buck per disc, and hopefully avoid overcharging the buyer for shipping. I found that the cost of shipping cd's on my own is far below the cost of using a fulfillment company, even taking into consideration the time committment.
I looked around and found cardboard jewel case cd mailers (you probably know what I mean) available regularly online for about 18 cents each in bulk (500 of them for under 90 dollars including shipping). There are also bubble mailers that are about 1 or 2 cents more, and are probably worth the extra money since they're self-sealing. One CD in a box or bubble mailer weighs under 5 ounces, which would cost $1.29 to send first class.
The other thing you would need is a paypal link on your site. Of course, this is assuming you already have a website. If you don't and you're at the stage where you're selling an album, then I strongly suggest you get one. Anyways, paypal charges 2.9% + 30 cents for each transaction on a standard business account. If you sell a high volume they give you a merchant account and the percentage varies between 0.7% and 2.9%, dependent on your volume. So, suppose you sell your cd for $15, the worst you could do is owe them 30 cents plus the 2.9% on $15 which is about 45 cents, so a total of 75 cents.
So, what does it all add up to...
$0.2 for bubble mailer
$1.29 for postage
$0.75 for paypal services
= $2.24
This saves you about $1.50-$2 per disc. I know from experience that it takes about a minute and a half to package and address a cd. So, suppose you're selling about 5 a day, or 35 a week. If you shipped once a week, it would take you an hour to package them and however long it takes you to go to the post office, which for me is about half an hour. I'm pretty sure you can apply postage directly to these, put them in your mailbox, and cut out the trip to the post office, but I personally like to see them put in someone's hand. All told, you end up making back about $40 an hour for the extra time you put in.
You could also charge your buyers an honest shipping price to meet your cost, and save another $1.29, bringing the total cost down to under $1. Most people will see that shipping charge is insignificant and very fair compared to what's usually paid.
Naturally, there is a lot more to consider. If you're a high volume seller, then maybe the extra money spent is worth it. Also there's the possibility of failed delivery, which is (sometimes) conveniently taken care of by a fulfillment company. The list goes on, but what I've presented is a reasonably accurate estimate of what kind of investment you can make in taking care of business on your own.
I hope this is helpful to some of you out there, and let me know if you have any further thoughts.
Peace out from Delft,
Peter