There are a lot of challenges to having an online business. One of them is accurately calculating postage and shipping. There are a lot of costs involved with shipping and if your business goal is to recoup your costs (and not lose money), you need to take these things into consideration. Here are a few tips to help you more accurately calculate your costs.
NOTE: the costs used in examples are only examples. Your actual costs may vary depending on your source and the quantity you purchase. You’ll have to figure out your costs based on…well. your costs!
POSTAGE
Obviously when you set a shipping fee for an online item, you must take postage costs into account. My earlier blog,
Economically Shipping Small Items, gives you an idea on how to ship a 1 oz. item for the most cost effective price. Your item may be heavier or have different shipping requirements, such as insurance or a different carrier, so you will need to use a similar technique to determine the best way to ship each item and the actual postage cost.
PACKING MATERIALSThe materials you use in your business may include:
*gift box or bag
*packing peanuts or bubble wrap
*shipping box or envelope
*packing tape
*shipping labels
*printer ink
It may seem ridiculous to consider the cost such small items, but whatever you spend you must recoup somehow or your business will lose money. We're not in business to lose money!
How can you figure it out? You don’t have to know exactly the cost of these items per package, but you can make an educated guess.
EXAMPLE: Say I use about 6 inches of tape on each envelope I ship. The label states there are 100 yards of tape on a roll that costs me $6.
Multiply 100yds by 36inches in a yard = 3,600 inches in a roll of tape
3,600 divided by 6 inches used for an envelope = 600 envelopes I’ll be able to seal with this one roll of tape (about)
$6 divided by the 600 envelopes = $.01/envelope
That’s not going to break anyone’s postage bank, but it adds up. Here’s an example:
*gift box or bag $0.50
*packing peanuts or bubble wrap $0.05
*shipping box or envelope $0.50
*packing tape $0.01
*shipping labels $0.25
*printer ink $0.05
TOTAL $1.36Oh, you may think. I can manage to cover $1.36 without passing this on to the customer. But 600 packages later you're gonna need about$816 to go buy more of these materials! Fortunately, you've included these estimated shipping fees and have the money to replace your packaging materials!
TRANSPORTATION COSTS
Now, how is that package going to get to the post office or shipper? If you’re driving it over, how much is your gas going to cost you? I have to drive a 5-mile round trip to the post office. My car (no, I don’t drive a Mercedes…except in my dreams) gets about 22mpg and gas is running about $3/gallon today.
$3 divided by 22mpg = $0.14 cents per mile
$0.14 times 5 miles = $0.68
You can decrease this cost by:
*limiting the number of times per week you go to the post office
*ship several packages at once (spreading the cost of the gas)
*have the carrier pick up the package
So, now I have
* my 1 oz. envelope with its $1.26 postage PLUS
* $1.36 in materials costs
* PLUS $0.68 gas.
That’s $3.30 for shipping and postage. But wait, there’s MORE...
...YOUR TIMEYes, your time is worth something. If you have a small business and you’re not shipping that frequently, you may opt to ‘donate’ your time to the process. Having a lower shipping cost may help you gain customer base.
If you’re doing a lot of shipping, you already know it takes time. You may even be considering hiring someone to help out and these costs need to be incorporated either into the cost of the shipping or perhaps into the price of the item.
Either way, you should be aware that this is a cost and at some point you need to calculate the cost and decide how you’re going to get reimbursed.
WRAP IT UPWhen you mail a package to a customer there is more cost involved than just the postage. No one goes into business to lose money, so you need to consider the various costs, including shipping. Shipping costs include everything you use to package the item from the box/envelope to the tape to the label. These costs add up, but if you collect a small amount with each package shipped to recoup these costs, you are not losing money. If you’re driving your package to the post office, you need to consider the gas costs and at some point you need to include the value of your time.
Your business model should be to make money and shipping and handling is a cost of business. You have to charge for these costs or your business loses money.
COMING SOON......a new WellspringCreations blog on saving money by buying shipping materials in bulk, including links to sources.
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Leave your reaction in comments. The best response entered by Tuesday, November 24 at 12noon Pacific time wins a prize from Wellspring Creations. I'm the sole judge of winner and will send you a prize of my choice valued up to $20. 
Doing custom work requires two distinct traits: art and science. The art side is pretty obvious. You have to design something attractive that suits the piece (enhances, not overwhelms) and that the customer likes. But the wirewrap performs a function: it holds the piece in place. There's a lot of geometry and physics involved. To me, it's like a puzzle that has to be solved. I love it.
The bottom wrap is actually fitted in a crevice of the carving. Jade being particularly hard, this was a safe choice. Trying this on a softer stone could have damaged the stone. I used a pair of existing holes in the stone to affix the top/center to the top wrapped frame.
This bezel idea came to me while I was considering the jade piece above, but the thickness and uneveness of the stone made it impractical. It was perfect for this piece. The geometry was a challenge on this bezel, as was the actual execution, but I was pleased with the outcome...and, more importantly, the client was thrilled!
The chain and clasp came as an afterthought inspiration. The client requesed that I cut off the original pin of the clasp and convert it into a pair of loops to use as a bail. The resulting openings were rather small and a dainty, delicate chain did not suit the piece. This bothered me subconsciously, but the morning I was to return the pendant to the client, this idea came to me. I continued the sterling/copper and asymmetric theme, even to the toggle clasp. It is actually two separate chains, each one connected to one of the loops on the back. This also solves the problem of the clasp sliding around to the front.
I am now working on a new piece--this lovely faceted citrine! It is a particular challenge to wrap as it has slick edges, must have a base that allows it to lay flat on the client's chest, and must be open enough on the sides to allow the light to refract. I knew immediately what design I wanted to use, but planning the implementation has been tricky. Can you guess? You'll have to wait and see!
Update: Here's the final piece! 
I woke up at 3am. I wasn't wide awake and would have drowsed off, but I made the mistake of thinking about jewelry. Next thing I knew, three great designs were floating through my head, so I got up to sketch them. One thing led to another and pretty soon I was trying to solve certain logistical questions by making up one of the ideas...and here it is perched on my dahlia! A wrapped copper loveknot with copper-flecked blue goldstone.
Here's Design #2, WHEW! it's very labor intensive and really requires four hands and the mind of Archimedes! (Why is there so much geometry in jewelry?)
while others are one piece. This bracelet is an example of an unhinged, one-piece cuff. (A bangle doesn't open and you have to slide it over your hand and onto your wrist. The pictured bracelet does have a hidden clasp, so it is a cuff--do NOT slide it over your hand!)
1. Unlatch the clasp and open the cuff only wide enough to pass across the narrowest part of your wrist. 
2. Slip the bracelet on across the narrowest part of your wrist. Rather than from the top down, slide it across from side to side (the photo shows a side view).
3. Once the cuff is around your wrist, gently slide it around so the clasp is in the correct position. The cuff illustration shows the clasp is actually at the top of the bracelet. More often, the opening will be under your wrist.
4. If the cuff has a clasp, close the clasp. It may be easier to push your wrist against your body to hold the bracelet in place while you close the clasp with your other hand.
The doors opened and I made a beeline to CGM. Usually, there's a crowd, a long line, and a long wait, but not that day. They didn't even have their 'take a number' machine out! I picked up some lovely, delicate flat cable chain and rolo chain. I also bought some jumprings that somehow did not get into my bag...but they mailed them to me immediately when I called their LA office! Great customer service!
Avalon Beads had some marvelous finds. I love botswana agate and these rounds are gorgeous. The amazonite chips are perfect for a cuff bracelet that I've been visualizing for months! Those sparkly squares are aventurine! They're dyed, but too lovely to pass up.
I'm working on the amazonite chip bracelet, but I did finish a bracelet with the aventurine squares! If you want it, buy it fast, 'cause I'm mighty tempted to keep it for myself!
Always on the lookout for the unusual, I found these amazing natural amythest from Frank Import Trading Corp. They are graduated and range from 1" to 2-1/4" long--the possibilities are exciting. Check out that one with the chevron zigzag! 
They also had some unbelieveable spinel. The first hank found by my neighbor was almost black, it was so dark a gray, and it had a blue tinge to it! The guy behind the counter said "Oh no, you want to see this" and he pulled out a deep black hank from the wall behind. WOW! The sparkle. I didn't ask the price (neither did my neighbor), I knew it wasn't in my budget. One day! She and I agreed that we liked the lower grade for its subtle color and would it make a stunning multistrand choker
I went to JM Imports last. This was the booth recommended by my new friend at the entrance. They had some gorgeous gemstones, but my allowance for this day's shopping was about gone. They were the ONLY booth with natural malachite and they only had them in these chiclets, which are one of my favorite shapes! 
Obviously when you set a shipping fee for an online item, you must take postage costs into account. My earlier blog, Economically Shipping Small Items, gives you an idea on how to ship a 1 oz. item for the most cost effective price. Your item may be heavier or have different shipping requirements, such as insurance or a different carrier, so you will need to use a similar technique to determine the best way to ship each item and the actual postage cost.
It may seem ridiculous to consider the cost such small items, but whatever you spend you must recoup somehow or your business will lose money. We're not in business to lose money! 
Now, how is that package going to get to the post office or shipper? If you’re driving it over, how much is your gas going to cost you? I have to drive a 5-mile round trip to the post office. My car (no, I don’t drive a Mercedes…except in my dreams) gets about 22mpg and gas is running about $3/gallon today.
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