What Free Shipping Means

It really is free:

China Post postage label
China Post postage label

Yeah, I’m sure that’s not what it means, but, still…

I don’t understand how the total cost of a nontrivial something shipped halfway around the planet can be less than the price I’d pay to return it. I’m certain it involves massive subsidies and mysterious cash flows that never break the surface of the eBay “Buy It Now!” pond.

7 thoughts on “What Free Shipping Means

  1. Old line: We lose money on every order but make it up on volume.

  2. Part international postal treaty, part stupid American politics.
    Member countries accept international mail from each other and forward it for a low fee. So, international mail from countries where mail is cheap is cheaper, than domestic mail in developed countries. Made sense, but is a big problem now. Companies are even dumping mail in low wage countries and resending. I like the cheap stuff, but I’d also be able to sell something online without adding $3-$5 shipping. Paying a little bit more for imports would be enough to have decent US shipping rates.
    The second part is politics. If they wouldn’t defund the usps, one could ship domestically for a lower rate and it would help small companies – not just Amazon, that can afford its own warehouses – to compete. By telling the USPS, that they should work like a private carrier, but obey international postal laws, they basically subsidize imports and defund domestic grow.

    Rant over, now I need a cheap Li-Ion board from aliexpress…

  3. I know, right?

    I usually order from DealExtreme. Often I will place an order for half a dozen things for maybe $20 total. What happens next is that various items are available at different times, so I’ll get maybe three packets in the mail each one containing two or three items. Sometimes I’ll get a packet with a single item costing just over a dollar.

    A friend of mine suggested that the Chinese government is happy to subsidise the postage costs (partly or entirely) if it means that my money goes to a Chinese company instead of somewhere else. This makes a lot of sense.

    Oh, and one more thing. If I buy something with a battery in it it gets rejected by the postal security in Guangzhou. You can look at the tracking history and see that it is presented to the post office several times in the hope that it will get through due to some slackness somewhere. Eventually I’ll get an email saying the tracking number has been changed and the item will be sent to me… from the Netherlands! So, since China and the Netherlands (and me) are on the same planet and subject to the same rules why is it that the Netherlands carrier can deliver the item to me, but China Post stops it? And, more importantly: how does it get to the Netherlands? It’s the same package, with an NL Post sticker on top of the original label.

    1. Some shipping/freight companies have special contracts with various postal companies and get special rates. Like “UPS Surepost”. UPS does the profitable long distance and for a few pennies USPS walks the last mile. For me it means, I get a packet at the UPS location 1/2 mile away, and for $5 I could pick it up, or they send it to the local post office the next day and two days later USPS delivers it.
      Some freight company have a special freight deal either for airfreight or a sea container, they fill it with mail from their customers and then ship it to a country that offers a special mail deal. From there it enters the normal mail stream.
      Internationally, I got stuff from China via Sweden Post! Netherlands seems to be the same deal.
      From China, “Yanwen” seems to use empty freight capacity to the US and then dump it in New York at a special rate.

      1. From China, “Yanwen” seems to use empty freight capacity to the US

        That would explain almost everything: the incremental cost for that volume would be pretty close to zero, so a tiny subsidy gets it across the pond.

        Then USPS delivers the package under the assumption that somebody paid some postage somewhere. Which seems no longer true: USPS becomes the Politburo’s unpaid delivery department.

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