Cutting My Own Throat

I officially recused myself from the Dr. Oz promotion when I learned that the doctor expects 70% of the show’s viewers to order their Corn-n-Tater Bags over the Internet. That’s a lot more than the 20% that I had guessed – potentially 35,000 orders, not the 10,000 that were already freaking me out.

I might have been able to set up a second website dedicated to those orders. It would’ve cost me around $1,200 to do it and my developer’s availability was iffy. But even if I could have gotten it done in three weeks, I had no way to stress test it. Based on a $1 per order commission, I might have earned as much as $35,000 – pretty damned good for a $1,200 investment, on the face of it, until you realize that my payment processing cost would’ve wiped out most of it (35,000 orders times $17 gross times 3.25% processing fee equals $19,335 right off the top), and the consequences of dropping the ball would have been devastating. The Healthcare.gov debacle is the latest example of what happens when a busy website launches without sufficient testing...something the game industry has known for a long time.

Passing up a break that was far bigger than I have ever wished for might seem stupid and self-defeating. Homecooked Shortcuts is going to divert their link to a professional fulfillment house for a few weeks of pure insanity. Steve promised to restore the link to Curio City as soon as volume falls below 100 orders a day. That’s still twice as many orders as I’ve ever shipped in one day, and it could go on for days or even weeks. Even without that, I’ll still get spillover sales from people who find me through search. So I still stand to reap considerable reward from the Oz thing without cutting my own throat. If this pans out, I’ll still set new records for November and December.

This all assumes that product is available. Homecooked is “only” producing 25,000 bags on the assumption that Dr. Oz is exaggerating. That’s a huge investment for them. If the doctor’s results match his projections, though, those bags will all be gone in a few hours. My $2,000 gross from the 150 that I have in stock will be the end of that. I guess I should place one more reorder before the Nov. 13 air date, even though the 150 that I already have looks like an awful lot.

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I lost interest in the Google Analytics training after the first two lessons proved to be aimed at big companies that employ marketing and web development specialists. I wanted some tips that I could use; instead I got a lot of general information that would be relevant to Wal Mart. The third of six sessions started getting a little more practical, but I ran out of time to complete the course. Oh well. I didn’t really need to know how to segment my data among web and mobile applications and create data sets customized for my international sales force. I might still complete the remaining lessons by the Oct. 30 deadline if I unexpectedly find myself with nothing else to do.

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WTF Google? 

“In your Merchant Center account, you have selected the ‘Carrier-calculated’ 

shipping option at the account level; however, you have not provided item level ‘shipping weight’ attribute values for all of the items included in your feed or via API. Shipping weight values are required in order for the ‘Carrier-calculated’ shipping option to calculate and display shipping costs on Google Shopping.

“Starting on November 5 2013, we'll begin verifying that all accounts using the ‘Carrier-calculated’ shipping option are including ‘shipping weight’ values for each item. Items using the ‘Carrier-calculated’ shipping option that do not include ‘shipping weight’ values will generate errors during insertion and the items will not be eligible to display in Google Shopping.”

Good old Google, always making compliance harder for little players. Obviously, all of my items have the weight attribute; I couldn’t ship them otherwise. The problem lies in Sunshop’s data feed. I don’t know how this never came up before but I am once again at Turnkey’s mercy…please don’t make me lie to Google and tell them I’m using an arbitrary fixed shipping rate of, say, $6.

The Marketing Wizard Named Oz

This is going to be much longer than my usual post. Get yourself an adult beverage and put your feet up.

The guy who makes Corn-n-Tater bags (let’s call him “Steve”) is going to be on the Dr. Oz show on November 13. This TV doctor reportedly draws 168 million daytime viewers. I’m told that 50-60,000 people will try to order bags within four hours of the show’s airing. Maybe I’m off base, but I’m going to assume that most daytime TV viewers will order via telephone. But even if 20% of viewers prefer to buy online (purely a guess), Curio City could be slammed with 10-12,000 orders within those four hours. And demand will remain heavy for at least a few days, if not weeks, after the crush. 

For perspective, remember that it took me eight years to reach 10,000 sales. We’re literally talking about doing 10 years’ worth of business in a day.

Order taking and order fulfillment are both epic challenges. I have about three weeks to brace for this and I’m already getting elbow-deep in Christmas. Bear with me as I work through this. Leave a comment if you see any logic errors or have any insights.

Taking Orders

MDD Hosting has been rock-solid. I pay $9.78 per month for their Intermediate shared server plan. Their website says that 1 GB of bandwidth is equal to over 100,000 hits; cPanel says that I typically use about 6 out of 720 available GB per month. Raw bandwidth isn’t a problem. However, I’m limited to 25 concurrent MySQL connections. That means that only 25 people can navigate my site at any given moment – perfectly adequate under normal circumstances, but a serious bottleneck under the Oz scenario. 

Google Analytics says that my average visitor spends 1:21 minutes looking at 2.6 pages, but only 2% of them actually buy anything. The Oz crowd is pre-sold so their conversion rate should approach 100%. If a real buyer takes 10 minutes (purely a guess) I could handle 25 simultaneous shoppers six times an hour, or 150 transactions per hour (not allowing for the normal Christmas shoppers who wander in). If 10,000 people are trying to place orders in four hours, that’s 2,500 per hour. The difference between 150 and 2,500 equals a lot of frustrated shoppers. Put another way, it would take my website 66 hours working at full capacity 24 hours a day to process 10,000 sales. And there’s an outside chance that I might get even more traffic than that. 

Upgrading to semi-dedicated hosting doubles the connection limit to 50 at a cost of $50 per month. While doubling my capacity should cut my backlog problem in half, it doesn’t solve it and probably isn’t worth doing.

The next step up is a virtual private server. That runs a whopping $124.50 per month, but it gets rid of the connection limit and might solve the bottleneck. The Corn-n-Tater windfall would easily pay for a month or two of expensive hosting, and then I could revert back to my shared plan.   

Other costs are involved besides the monthly rent. I’d need to hire my developer to install Sunshop on the new server. If he is even available on such short notice, that’s going to cost at least a couple hundred bucks. I’d have to either reissue or reinstall my SSL certificate, I’m not sure which. Google would punish me for having a new IP address (I’m currently paying extra for a dedicated IP; can they reassign it to a new machine? I don’t think so but I don’t understand these things). Then I’d have to pay my developer again to undo this and revert to cheap hosting; I obviously can’t do that in December, so I’d be stuck with the expensive hosting for at least two months. My best guess at the total cost to move to an upgraded server and back is about $750-900.  
  
All of this assumes that Sunshop itself is up to that kind of load. I have no information on which to base or question that assumption. I might go through all the trouble and expense of moving only to find out that my little shopping cart still can’t handle the traffic.

SUMMARY: Taking orders is already possible, but at an unacceptably slow rate. Upgrading to overcome the bottleneck is expensive, but not prohibitive. Securing my developer’s support on such short notice might or might not be doable. I have no way of stress-testing the new installation before the big event, and I don’t have the expertise or time to troubleshoot if something goes wrong. Changing my IP address a month before Christmas would definitely pooch my normal holiday traffic; Google hates that. After all that risk and expense, it’s possible that Curio City won’t perform any better than the Obamacare exchanges did on their debut.

CONCLUSION: Risky and expensive, but not impossible.

Another option just occurred to me: Buy a separate URL and build a second store just for the corn bags! Running a second business would be a lot more expensive and trickier to set up (a new Sunshop license, new merchant services account, new bank account, new email addresses, new PayPal account, new SSL cert., etc.) but easier to run once it was implemented, and it would not put Curio City itself at risk. I could just shut it down when the rush is over. No time to dive into that idea today but I’ll explore it later if Steve is interested (see the Bottom Line below). 

Filling Orders

Suppose that I solve order-taking and find myself with 10-12,000 orders in a short amount of time. Yay! Now what?

One hundred corn bags fill an average-sized shipping carton. Ten thousand bags would be 100 boxes. The manager of the UPS Store that handles my receiving would freak right out, even if they were broken into four or five shipments. Plus I’d have to schlep them home in my Miata or Anne’s Fit, find someplace to store them…and then break them into 10,000 outgoing envelopes. 

Have I mentioned that I’ll be in the thick of my Christmas business by 11/13? There is no way that is going to happen at home.

I would need a commercial space with a loading dock and a one- or two-month lease. There are plenty of empty storefronts nearby and our local real estate baron might be willing to deal. I’d need heat, electricity, and Internet access. Just for the sake of moving this to the next step, let’s make two huge assumptions and say that I could find such a space in the next three weeks, and that I could get it for $1,000 a month. 

Have I mentioned that I’ll be in the thick of my Christmas business? I’ll be working flat-out by mid November just to keep up with normal business. I could spare a few hours to oversee a remote operation, assuming it’s not too remote, but there’s no way I can fill those orders myself. I would need to hire somebody. I don’t even know what all is involved in bringing a temporary employee on board; I’m sure there’s lots of paper to process. My wife believes she could find somebody who’d work for $10 an hour under the table; I’m deeply uncomfortable with doing something so illegal so openly. But to get to the next step, let’s make a couple of more big assumptions: That I can find somebody who’s trainable and willing to work for $10/hour in the next three weeks, and that this person (or combination of people) will put in 40 hours a week. That’s $400 per week in wages, plus approximately 12% in payroll taxes if I follow the law. And if my CPA is reading this: Relax, Ron, I'd keep it legal.

If s/he’s doing nothing else, this person can realistically print one shipping label and seal one package every two minutes. That’s 30 packages an hour or 240 per day or 1200 per five-day week. At that rate it would take 10 weeks to handle the expected volume. Steve plans to advertise 6-8 week fulfillment. I would need two minions for five weeks just to meet their guarantee. Labor is now up to $896 per week or $4,480 for five weeks. (Now I’m going to need a second month on that lease.)

These minions are going to need two computers, two Dymo label printers ($280 each), five or six 10-packs of labels at $326 each, and 10,000 padded mailing envelopes ($4,000). That’s about $6,500 worth of supplies plus whatever the computers cost.



So for a first pass figure $2,000 rent + $4,500 labor + $6,500 known supplies, plus the cost of two computers. I could buy myself the new laptop that was already planning to get in January anyway; figure $800 for that. My wife thinks she can scare up a crippled freebee for the second one. Total anticipated cost of fulfillment = $13,800 – round it up to $14,000.  

Have I mentioned that I would have to make this all happen in three weeks while the Christmas season is gearing up?

SUMMARY: Fulfillment is complicated and expensive, time is short, and there are way too many large assumptions above. It will fail if anything goes wrong. There’s a reason Homecooked Shortcuts is outsourcing their fulfillment. I might be able to outsource fulfillment, too; there are lots of companies that do that. But I don’t have time to look into that today. In fact, the fulfillment industry is such a hive of scum and villainy that I wouldn’t have time to research and implement that even if I decided right now to go for it. 

CONCLUSION: There is no freaking way I’m going to handle fulfillment. I don’t think I could set this up even if I could work on it fulltime for the next three weeks. 

For perspective, Steve would give me his lowest price on these bags, so my markup would be a very healthy $9.50 per bag. Gross sales for 10,000 bags are $139,900 and I’d net $95,000. Payment processors take 3.25% off the top line, or $4,500. So $95,000 minus $14,000 fulfillment costs, $4,500 in bank fees, and maybe $1,500 in order processing costs still leaves an astonishing $75,000 profit. That’s lots of margin for error.

If I had twice as much lead time, and if it weren’t Christmas, I’d be all over that. 

I have until Monday to come up with a proposal. Steve already plans to outsource telephone fulfillment and won’t hold it against me if I bow out of this gig entirely…which is the way I’m leaning. Even if I surrender my official online distributorship and sever my link to the Homecooked Shortcuts website, I’ll pick up some stragglers who see my ads when they google the product. That spillover alone could be hundreds of extra orders and might be enough to push this Christmas over the top. Steve says he’ll restore our relationship after business settles back down to normal. I’m not sure I believe that, but his product hasn’t been a huge success for me so far anyway.

BOTTOM LINE: When I call him on Monday, I’ll ask Steve if there’s any value in my taking online orders but not fulfilling them. I think I could swing that, but I’m not sure how much value to him or profit for me there’d be in doing it. This discussion is tabled until I find out.

Incidentally, Dr. Oz gives a vendor one free appearance to demonstrate the show’s immense selling power. Vendors can then make encore appearances by cutting Dr Oz in on the take. If Homecooked Shortcuts sells as many tater bags as they expect, they’ll probably repeat their performance. Maybe I could get in on an encore, with more lead time and no Christmas.

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I’m already ordering untested new merchandise that I can’t pay for based on faith that Christmas bucks will materialize in time to cover late November’s bill. I’m not normally a faithful person, but this faith is based on logic and experience. I go through it every year…always with the same trepidation.

Last week was the busiest of the year. This week was merely average. Republican debt ceiling brinksmanship probably scared some customers away. It certainly frightened me into holding my Christmas orders until I was sure that the tea party extremists wouldn’t bring the economy to its knees. I’ll get my holiday stuff a little later than I’d like, and I’ll lose a few early sales. It could have been much worse. 

I had expected to lose more ground in October, so even having a shot at matching LY is an achievement. On Monday I’ll get my first halfway decent paycheck since last spring.

Dropships Drop My OTB

I’m selling so many bird kites as dropships this summer that my open-to-buy (OTB) is freaking out. For those who are just joining us, a “dropship” is not a cool planetary assault vehicle like the one pictured above, but the far more prosaic practice of having a vendor ship an order directly to my customer instead of to me.

A proper OTB calculation is a fiddly fussy formula that’s way more complicated than my low-budget one-man operation needs. My OTB simply tallies up the average cost of merchandise as I sell it and subtracts what I spend on orders. If I sell $100 worth of stuff in a day and my average cost is 50.4%, then that increases my OTB by $50.40. 

My little formula includes the inbound freight charges that I pay to vendors, but not the amount collected and spent on outbound shipping to customers because those don’t affect the cost of replacing my inventory. But dropships are different. I still collect a shipping charge from the customer, but instead of paying it out as a postage line-item that offsets shipping income, I pay the vendor to ship the kite to the customer. That reduces my nominal shipping expenses while increasing the cost of the merchandise.  

Things go out of whack when dropships become a substantial part of my sales. Everything’s fine if $100 worth of kites actually costs the average $50.40. But if I pay the vendor $50.40 for the merchandise plus $15 to ship it to the customer, my OTB gets reduced by $65.40. The more I dropship, the more my OTB falls. A lot of dropships in May and June drove today’s OTB to negative $293. 

Now, this is just a bookkeeping problem; I did collect $15.60 from the customer to ship the kite. But that $15.60 gets added to my shipping income without a corresponding hit to my shipping expenses. Over the same six-week period in May/June I took in $914 in shipping fees and paid out $634 in postage, yielding a $280 surplus…which very nearly cancels the OTB shortfall. Zero isn’t exactly what I’m striving for here, but it’s better than negative.

After pondering lots of possible fixes, I decided that only adding a new column (“Dropship shipping”) directly into my OTB is going to work -- a disappointingly obvious solution, perhaps, but it’s a big deal to me. Every time I tweak my Accounting spreadsheet, year-over-year comparisons are compromised.  

E-commerce for Dummies, Part 1: What Is an Internet Store?

This is my 300th post. There are 299 others like it. I’ll wait here while you go back and read them all.

Throwing my wife’s thoughtful suggestions for my “guest lecturer” gig to the winds, I decided to write about something interesting instead. I think her e-commerce grad students will find these three topics entertaining:

1.    What is an Internet store?
2.    Where does a dollar go?
3.    Self-employment: The good, the bad, and the ugly

My only payoff for doing this is the blog posts that I can get from publishing the first drafts. Here’s the first one (865 words): 

 

What is an Internet store?  

 
Besides being a state of mind, it’s mostly ones and zeroes. The muscle and guts of Curio City Online are:

•    Shopping cart software on a rented server;
•    The MySQL database that the shopping cart creates;
•    A Quickbooks company file;
•    A couple of Excel workbooks;
•    A checking account and two credit cards;
•    A Google AdWords account;
•    A UPS box (address) and a cell phone number; and
•    400 square feet of cellar space, more or less, devoted to merchandise and shipping supplies.

But first, the bones: Every business starts as a concept. Unless you have a specific passion, that’s harder to nail down than you might think. Curio City’s concept didn’t come into focus until I’d been in business for several years, and it is still evolving. Read my blog posts tagged “early history” from the bottom up if you want the full story.

Three layoffs in two years persuaded me to make a career change, and a small inheritance made starting a business feasible. My background in writing and editing, bookselling, and computer game development led to retail as the easiest and potentially most lucrative path.

After ruling out opening a bookstore, a game store, or a hobby shop, my search for a niche that wasn’t already owned by either a mass market retail chain or a category-killer web store settled on the vague label of “gift shop”. Keeping the store’s name non-specific would give me flexibility, and I could use the store’s website to test merchandise before making big inventory commitments.

Researching my business plan convinced me that brick-and-mortar stores can’t possibly make money. Rent, loan payments, and payroll (in that order) consume all the revenue. All of the desirable locations that I scouted were far too expensive, and all of the affordable leases were undesirable. I refused to go deeply into debt unless I was sure that it would pay off, and my spreadsheets were adament that it would not.

My wife’s suggestion that I start with the website first and worry about the store later broke the stalemate and led to Curio City Online as a home-based, one-man business. It took the Great Recession to finally kill the idea of opening a physical store (again, read from the bottom up if you want the full story).

Now to put some flesh on those bones.

The skin that Curio City shows the world is a licensed software program called Sunshop. There are a lot of competing shopping carts on the market (wiki has a good list) ranging from free up to $800 or more. The shopping cart’s front end displays products and enables checkout. Its back end is the interface that I use to manage my products, transactions, and customer accounts.

A MySQL database forms the guts under that skin. A web store is essentially a huge collection of data tables that one only need deal with directly when something goes wrong. The shopping cart manages that database.

Quickbooks is the desktop accounting software that organizes all of that MySQL data into a business. Although far from beloved by its users, Quickbooks has owned at least 75% of the small business accounting software market since the 1980s.

The Excel workbooks that I had used for research evolved into inventory and sales tracking tools that I find more useful than QuickBooks. I’d be lost without my Excel files, but this is a personal quirk. Most businesses get by just fine without them.

Cash is the life blood of any business, and that involves banks. Money arrives through a credit card processor, PayPal, or Google Checkout (all of whom take a cut off the top), rests briefly in a checking account, and quickly departs through Mastercard and Amex cards. When small businesses fail, it’s almost always because they lost control of their cash flow.

Google AdWords (and Microsoft AdSense) sell advertising on search engines. I pay a small charge (typically around 25 cents) every time someone clicks one of my ads. “Paid search” drives more than 80% of my traffic so maximizing the bang for those bucks is crucial.

My UPS box and cell phone are the closest thing Curio City has to a physical presence. Every retailer needs a physical address and a place to receive shipments, and a telephone number is just as mandatory, even if you seldom use it.

Most home-based retailers use dropshippers. These vendors (manufacturers, wholesalers, and importers) ship products directly to your customers without you ever seeing them, usually in exchange for a cut of the sale. Dropshippers free you from the need to buy and warehouse merchandise and from the effort of shipping it. But they also limit you to products from dropship vendors, which is why so many small online retailers sell the same stuff. Investing several thousand dollars and half of my cellar in actual, physical inventory gives me the freedom to carry whatever I want, quality control, and all of the revenue. Eventually (I hope) my sales will outgrow my ability to handle them and I’ll have to outsource warehousing and shipping. I’ve blogged about strategies for kicking it out more than once, although the Great Recession put the kibosh on those plans.   

That's essentially all there is to it. I'll be happy to answer your questions about the specifics.

Resistance Is Futile!

Amazon wants me. All of the objections that I raised about the Amazon Marketplace last September are still true, but I did end that post with “I’ll revisit this idea going into next summer’s doldrums.” Now here we are.

150 million unique monthly visitors hell-bent on shopping add up to one huge reason to join the Borg collective. Amazon recently made it a little easier to sell out. And what man can say no to 7 of 9?

First, the array of “revenue share” points has been winnowed to 15% across the board (except for jewelry at 20%, but I would not list that). Second, Amazon now handles the initial setup; the complexity of that was a big turnoff last time. The 40-product minimum is a burden, but I could easily pad that requirement with Switchables covers.

Drawbacks besides the logistical ones that I wrote about last September:

•    2 million other merchants are cutting one another’s throats in the same space, and most of them are more ruthless than I am.
•    Amazon uses its participating sellers’ sales and pricing data to compete with them directly. You will soon find your “host” moving in on your successful products.
•    Adding my best products enhances Amazon’s appeal, not mine, while Amazon’s name weakens my brand. Customers don't understand the difference between buying from Amazon and buying through Amazon. I don’t want to be a mere distributor in the collective.
•    Amazon owns the customers who buy through their website and forbids its sellers from marketing to them – not a big practical concern, since I do almost no direct marketing, but it bothers me anyway. I assume that Amazon’s Terms of Use (such as their privacy policy) supersede mine if those customers are its property.
•    Amazon prevents sellers from controlling product images and descriptions by applying standards to each UPC.

To succeed, one must have an appealing product at a competitive price that Amazon and its merchants aren’t already selling in any quantity. The UPC code requirement rules out my more offbeat items.

A recommended strategy is to keep your bestsellers for your own site, and use Amazon to test new products or liquidate losers. That’s one argument in favor.
 
Internet Retailer magazine said that sellers who have fewer than 40 transactions per month pay only 99 cents per sale. Forty doesn’t sound like much, yet it would be a 40% increase over my typical 100 monthly sales. Can I suspend my Amazon products when I reach 40 sales? Their salesman wants to sign me up as a “Pro Merchant”, which I think precludes the 99-cent small seller option. He wasn't interested in discussing the small-potatoes approach that interested me.

Mostly, the 15% haircut is a killer. Consider what happens to each merchandise dollar that I ring up. A bit over 50 cents pays for the stock. Twenty cents goes into my pocket, and I have to pay another 3 cents or so in payroll taxes. Ten cents goes to advertising. Payment processors take 4 cents. That leaves 13 cents to cover everything else – packing and printing supplies, licenses, annual taxes and fees, professional services, Internet and telephone, etc. My actual profit is whatever’s left after I meet all of those miscellaneous expenses (which obviously ain’t much). Amazon covers payment processing costs, so that reduces their take from 15 to 11 cents per dollar. That would leave me only 2 cents out of every dollar for miscellaneous expenses and profit.

OK. For 2 cents to do the work that 13 cents is doing now, dollars would need to increase by…well, I don’t know how much. It’s less than sixfold because some of my expenses are fixed (advertising would not rise proportionately, for example), and because the 11-cent Amazon expense would only affect the Amazon portion of total sales. But it’s definitely a lot.

Ultimately, though, it just feels wrong. Curio City’s niche is selling products that you don’t find in mainstream retail. Amazon defines the mainstream. Joining the mainstream contradicts my core concept. So, for better or for worse, I rejected their pitch again – permanently, this time.

What next? I do want to jazz up my game this year without risking a lot of money or radically changing the way I do business. Growth is already returning to Curio City as the economic recovery finally trickles down to the middle class. How do I enhance that without risking it? Facebook advertising didn’t work. I decided against selling on Amazon. What next?

Next week: The dread Ess-Eee-Oh puts in another appearance.

The Incredible Shrinking Profit

I got my tax return back, so here’s a little statistical trivia: At the end of last year I estimated my annual profit at $3,760. The actual final bottom line was $3,256. The return is much too complex to understand the $500 discrepancy between my guess and reality, and Schedule K-1 has a couple of little adjustments that bring my share down to $3,192. The bad news is that my total compensation for 2010 was only $15,609, not the $16,177 that I had thought. The good news is that I set aside a little more for taxes than I’ll really need. The bad news is that the $2,800 that I took out was really 86% of my profit, not the 75% that I meant to take; the $350 difference explains why my company is having so much trouble making ends meet right now.

Well, that plus the sales collapse.

February is running way below half of LY after recording the worst week since last July. My expectations were low this month, but not that low. Traffic is within normal parameters. My conversion percentage is slowly recovering from the burst of low-quality visits that I bought from Facebook. The average order value has slipped below $37 ($45 is normal). Sales this week averaged $47 per day, vs. $175 needed for success. I’d almost rather have no business at all than these little nuisance sales.

Next week’s monthly sales report is going to be grim.

The consolation for making no money is having ample time. This morning a test drive unexpectedly turned into the full-blown ordeal of buying a new Honda Fit. I’m finally just sitting down to Curio City at 3 pm. The consequences of missing most of a day? None, apart from trading our whole savings account for a new car.

I’m going to give my Parcel Post experiment one more week before I blame this slump on eliminating those cheap rates. My latest thinking goes like this: If I reinstate Parcel Post, I will again have to pay more than I collect to ship some of my larger orders (because I always ship Priority Mail). But suppose that I raise my handling fee 20 cents instead of cutting it by 10 cents, as I did last week. People placing larger orders won’t notice the 30-cent difference if they’re offered the cheapest rate class again. The real impact will be on low-end First Class orders. Because they’re more numerous, they should make up for the lost margin on bigger orders.

I like the idea of the small sales subsidizing the bigger ones. I’m just not sure yet that shipping costs are the root of my current problem.