$1 item including postage?

[brightcrafted]

Hi there, I am new to eBay selling. I was just doing some research lately and notice a few low-cost items that are selling for $1 including postage within Australia. How is that even possible without making a loss since the cheapest postage Australia Post do is $1? I thought this might a loss leader item for the seller but eBay is saying the seller has sold thousands of these items.

Any ideas?

[jellybirddesigns]

Most of those types of items come from China where the postage is heavily subsidised by their government. Just because an item says it is in Australia, doesn't actually mean that it is. Chinese sellers are notorious for mis-representing their item locations. You need to look at their seller feedback as the negatives will often complain about shipping from China.

[brightcrafted]

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@jellybirddesigns wrote:

Most of those types of items come from China where the postage is heavily subsidised by their government. Just because an item says it is in Australia, doesn't actually mean that it is. Chinese sellers are notorious for mis-representing their item locations. You need to look at their seller feedback as the negatives will often complain about shipping from China.

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That's not true, this particular seller has 99.7% positive ratings over almost 4000 ratings. Reviews verified the shipping is from within Australia.

[lyndal1838]

Can you post the full title of one of th items you are talking about please?

It might give us some ideas as to how the seller can do this.

[brightcrafted]

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@lyndal1838 wrote:

Can you post the full title of one of th items you are talking about please?

It might give us some ideas as to how the seller can do this.

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Try "SIM Card Adapter Kit 4 in 1 Nano Micro Standard Size Converter Tray for iPhone"

[imastawka]

Beats me.

They're actually losing over 40c per item, what with Paypal flagall, fvf's as well as paying postage.

But I'm guessing the item is posted from China, no matter what they say.

Feedback on one of them suggests this might be so.

[purplemon18]

Almost certainly they are shipping from China. It has several of the hallmarks of chinese sellers.

• Aussie flag map
• auspost logo
• photoshopped pics that are very busy
• Grammar that isn't quite right: "If you have any question, do not hesitate to contact us."

The item you specifically used as an example could be sent with a $1 postage stamp since it's small enough, and if they had a contract with Auspost and used a franking machine or whatever, they could shave a few cents off that. But Stawks is right, ebay and paypal fees would really make it impossible to profit. Even from China, they couldn't be making more than a few cents. Doesn't seem worth the time.

IMO this is ebay's biggest problem and ebay australia would love to shut them down, but ebay china is protecting them. All you can do is ignore them and trust that your customers are savvy enough to avoid them and shop with a good honest seller like yourself.

[digital*ghost]

Many sellers don't look at making a profit on each and every item they sell - they look at making a profit overall. 

Part of that strategy can be to have loss leaders - this is having a relatively popular item at competitive prices to attract buyers to their store and (hopefully) not only purchase that item, but others as well (like when you go to the supermarket to get some item they've advertised at half price, they make their money through the impulse buys). What they lose on the sales where someone buys just one $1 free-post item, they more than make up on the sales where someone buys a bunch of stuff. You'll notice they have a promotion that provides a discount once a certain $ value is being spent in the store - it's only 5% off when spend reaches $50, but you might be surprised how many people will look at a $1 item, and then look at what else that seller has in the name of getting a deal. 

If you look at the sales history of that item, lots of people bought 1, but there's also a smattering of people who bought 2+ (highest quantities are 15, 25 and 40). 

On eBay, popular listings help the visibility of the store in general - the seller doesn't look at it as a loss, they look at it as advertising / marketing, with better return than just paying to promote (on eBay / google /  Facebook / wherever), because they get the BM boost, and hopefully a bunch of positive FB to give them more cred as a seller as well. 

This applies regardless of whether the items are shipping from China or Aus. 

[purplemon18]

You make a good point. If I were selling that item, I would lose about $0.75 per sale, which makes it a lot cheaper than google adsense. Hard to say which form of advertising is better though. It's also questionable whether any advertising is needed at all beyond just making a good listing.

[clarry100]

It would indeed be very interesting to order one of these and see how they do it.

But here is my suspicion on how its done.....

They use a POSTAGE PAID stamp on the front of the envelope.

They put the return address label as the recipients address on the back of the envelope as well as on the front.

So the TO & FROM addresses are identical, both the buyer's address.

Then they drop these envelopes into a red street post box.

Such envelopes using these POSTAGE PAID stamps are supposed to be lodged over the counter so AP can bill to the sender's account.

If these are dropped into a red box then the policy of AP is to return them to sender or send them to the DLO if there is no return address.

But guess what... if the RTS address is the buyer's address they still end up receiving it anyway.

So the seller has just gotten totally FREE postage. After fees etc from his $1 none is for postage.

Someone care to order one jsut for the hell of it and report back here????