A maths question

Two possible alternatives - weigh each single item and calculate that as a percentage of the total weight and then multiply that answer by the cost of delivery. Apply answer to cost price of goods + your sales margin/mark up to give you total sales price.

Alternatively, add the cost price of all the goods together and then work out the % cost of each individual item of the total cost price (i.e., price before taking account of the delivery costs). Then multiply that answer by the cost of delivery and apply answer to cost price + your sales margin/mark up.

I think I would do the former of the two - because you're applying the delivery cost according to weight and not what cost price you're paying for the goods. This is essentially how carriage costs are calculated.

Depends if the delivery cost is related to weight, number of items or some other metric. If it was Amazon for example, the cost is per item but with specific item charges per class of item (ie books one price, dvd's another etc), but with other companies it might be a flat fee, an amount per item, or an amount for a certain number of items.

Thank for the quick response, we do not want to add weight into this equation as it complicates things, as the the heavier items are more expensive anyway. To distribute the delivery cost evenly would be fine.

Thanks

Is this trial run supposed to be a zero-profit at-cost exercise?

If so, obviously the cost excluding shipping is about $80, so to recover the shipping would require a mark-up of about 50% on each item's price.

But if not, you're asking a completely irrelevant question. She should price the item at what she thinks customers will pay. If the new business is to take off, never mind survive, the prices will have to be realistic, and to shave off too much by way of "introductory offers" might be a fatal commercial mistake, since if the eventual "normal" price is too much more than the introductory one, people might well not buy them. She presumably hopes that if she orders 20 or 100 times as much stuff next time, the shipping costs won't also be 20 or 100 times as much. Perhaps she can sell them at cost now and for the same price later, the saving from shipping in bulk then becoming her profit.

Bitstring , from the wonderful person Sim said

Wot, not customs duty + VAT? If she did escape this time, she better figure on them catching up with her one of these days. Why not use the time honoured formula of turning $ into £ by simply changing the character, and leaving the numbers alone?

What prices will the market bear? That's usually a good starting point.

Rgds

__ Richard Buttrey Grappenhall, Cheshire, UK __________________________

She has obtained the classifications codes and calculated the duty and VAT which has been paid on delivery to UPS.

She can estimate the delivery charge, but would like to apply the correct fees to the cost and then apply the margin.

Thanks

"Richard Buttrey" wrote in message news: snipped-for-privacy@4ax.com...

buy the stock complete as much as you can and bear the price - economies of scale etc - afterwards = zero delivery overhead. if you cannot do that, your wifes idea may not be viable.

I tend to think that if you are not prepared to invest in your stock, then you don't believe in it enough. and that's bad news.

What about working out what it would have cost to ship each item individually and then then share out the actual aggregate shipping cost in proportion.

Robert

you could do that, certainly, if you were prepared to accept the same postal overhead on small items where carriage is negligible and other items where its a real concern. depends on the items in question I guess...

But the point being made was that the market might bear a price which bears no relation to a strict mathematical apportionment of the delivery charge.

Taking an extreme example the $1.25 items might be so much in demand that you could ask $5 for them, whilst the $24.99 items might not sell if you add anything to them.

This is not so much a question of strict cost apportionment, rather one of economic elasticity of demand.

Oh, by the way, it's usual in Use-Net to bottom post.

Rgds

__ Richard Buttrey Grappenhall, Cheshire, UK __________________________