When shopping online, you tend to run into the lie pretty quickly.
Spend a certain amount—perhaps $15 or $20—and your shipment is free. Take advantage of competitive holiday promotions that promise free shipping on any item, no minimum required. Or subscribe to a service like Amazon Prime, which, for $99 a year in the United States, offers members free shipping on millions of eligible items.
But the truth is that, like virtually everything else, “free” shipping is not actually free.
The implications of the lie aren’t often felt by us consumers, who have come to expect free shipping. The biggest impact is felt by e-commerce businesses, particularly smaller ones, which face what some have called an emerging crisis: The cost of free shipping, in many cases, is unsustainable.
For many online shops, the cost of a free shipment is either folded into the prices for items or funded by investors. Jerry Storch, CEO of Hudson’s Bay Company, a brick-and-mortar giant that includes Canada’s The Bay department store, Lord & Taylor, and Saks Fifth Avenue, says it’s much more expensive for retailers like them to deliver products to a customer’s front door than to have them shop in the store. For the retailers that can pay for it, he says, free shipping is becoming a loss leader.
At Adafruit we do a $200 or more free shipping tier, however – it’s continental USA and it’s UPS ground, not the lesser-quality SurePost or SmartPost “last mile” services (those can be OK but unpredictable times for delivery). With UPS ground and the rates we get that’s about as good as it will get for awhile, we’re exploring other options for non-time-sensitive deliveries, just like everyone else Amazon world, we just live in it.