OT Shipping from amazon.com and tool crib

[Chris Oakley]

I bought 2 pair of pony clamps some dust collection hose and fittings. I used their free shipping. They sent EVERYTHING separately. I mean, they even shipped the clamps in different packages. How can they make money on $11 clamps shipping like that? Don't get me wrong, I appreciate receiving each item quickly, just curious.

[Dave Avery]

They don't make money, at least not on an accounting basis the last time I checked - which was a year or so ago.

What they're hoping to do is build customer loyalty for customers where price is a seconday consideration. It worked on me until I ordered the new Potter book for my 12 year old. $42 plus $3 Fedex shipping sounded a little high, but I figured that Amazon's prices are usually somewhat competitive, so I didn't bother checking around. Quickly found out that I could have bought the book all day long locally for $20. Soooo, to make a long story longer, they nailed me and NOW I'll be much more careful. Now, if they had chaged $30 bucks, I probably wouldn't have felt so hosed.

Bottom line is, as someone once said, "price, quality, service, pick any 2". They can't offer great prices, super service, and great quality and still make money, at least they haven't yet. And if they're busy gouging their good customers, the situation will only get worse.

Dave.

[Scott Coffelt]

from them it arrive Fed-X two day air, I paid $425 delivered. No way they even came close to making money. I shop around as many folks do, but many people just think they are cheap on everything. Case in point, been looking at the Bosch porta handplaner. HD sells it for $99, Amazon wants $109. Even with tax it is cheaper locally. Kansas is getting ready to pass a tax change to hit online orders, sure gonna make the online prices less attractive.

[John Wadsworth]

Chris,

Your shipment was high-value compared to mine. I ordered a bunch of wire-type 4" hose clamps for my DC as part of a larger free-shipping deal. The ten clamps came in four different boxes, all within a one-week span--total cost to me, $9.90, no tax, no freight.

This isn't just currying customer favor--this is nuts. I would have been just as happy to get all ten of them a few days later--indeed, when you opt for the free shipping deal, they warn you they'll group your order in as few packages as possible. Except they don't, time after time.

Go figure.

[Kirk (KC) Constable]

Chris,

Your shipment was high-value compared to mine. I ordered a bunch of wire-type 4" hose clamps for my DC as part of a larger free-shipping deal. The ten clamps came in four different boxes, all within a one-week span--total cost to me, $9.90, no tax, no freight.

This isn't just currying customer favor--this is nuts. I would have been just as happy to get all ten of them a few days later--indeed, when you opt for the free shipping deal, they warn you they'll group your order in as few packages as possible. Except they don't, time after time.

Go figure.

A couple years ago we order probably 30 Jorgensen I-Bar clamps. Not only did they come in their own boxes shipped separately, we ordered a combination of 48" and 72"...and got a lot of 36" mixed in. So they paid to have them picked up and then shipped them back correctly....one at a time. As I recall, that was back in the '$5.00 shipping for any order' time period...

KC

[Brad Schafer]

amazon - or any of these on-line order houses - is/are just that: order clearinghouses. they don't have inventory. they source stuff from other companies that do nothing but stock & ship inventory. and these warehouses are all over the country.

when you put in an order to amazon, they turn around and put in an order at a the warehouse that's cheapest to ship from (usually the one closest to you) that provides them the best margin. often, the orders are filled from different warehouses (depending on where the stock lies).

it's not as big of a money loser as you think; in fact, the loss has been the ramp-time required to build the supporting infrastructure of loosely-coupled companies, and the (extremely complex) software required to pick the cheapest delivery route that still affords the order taker (amazon) the highest margin based on their price and gets the product to the customer in the timeframe requested.

it ain't like doing mail-order from one big centralized warehouse.


b

[John Wadsworth]

Brad,

I understand the Amazon business model, but paying UPS $5 or $6 to ship a 99 cent hose clamp is a transaction you can't make up with bigger volume!

Specifically, if their software is unable to minimize total shipped cost (within reasonable delay times) when picking warehouses and grouping the merchandise into packages for one order, something's wrong with it--and from the number of folks with similar stories in this thread, it looks like something sure is!

[Brad Schafer]

Brad,

I understand the Amazon business model, but paying UPS $5 or $6 to ship a 99 cent hose clamp is a transaction you can't make up with bigger volume!



agreed - but i'll wager that the price they ultimately pay a shipper gets written off on the back end (based on volume and business agreements). just because it shows up as $5 on the invoice doesn't mean that's what they paid. i also think you'll find that there will eventually be minimum order limits applied to shipments (if they aren't already there). and some of that shipping is eaten by the fulfillment people, depending on agreements between the order taker (e.g., amazon) and the fulfillment house.

one of our customers was one of the aforementioned supplier warehouses in Columbus; all they do is order fulfillment. it's an interesting business model.

sorry for the digression,

b