The Chocolate Life

Discover Chocolate and Live La Vida Cocoa!

I am starting this thread because I am working on an article about setting up shop online and I want to get some input from people who sell online and what has - has not - worked for them. I also hope that this discussion will benefit Startup Central members looking to go online who have not yet.

One thing I learned when I started to sell online was that all of a sudden I was getting into a new business - the shipping business. So not only did I have to think about how I was going to sell and get paid (credit card processing, shopping cart) I had to create a shipping area and figure out where to get supplies from, how to pack efficiently and cost-effectively - and as environmentally sensitively as possible; I also needed to pick a shipping company and then try to integrate all these different systems with the small business bookkeeping system I kept promising I would set up each new tax year.

Answering all these questions can take a lot of time and mistakes can cost a lot of money. What has worked for you?

Did you go with an online shopping cart or buy software and build your own?
PayPal or a merchant account for accepting payments?
UPS? USPS? FedEx?
Packaging supplies and charging for labor for packing.

:: Clay

Views: 415

Replies to This Discussion

Shipping

These days, I use USPS Priority Mail for everything except when the customer requires point-by-point tracking along the way.

USPS is not perfect, but I find it best for me for many reasons. USPS's primary weakness is the integration (or more to the point lack of integration) of their on-line systems for printing labels. If you want to automate printing labels from your shopping cart you need to choose shopping cart software that integrates with Endicia or Stamps.com. If your cart does not, you have to type the label information by hand. Integration can be a mixed blessing. With the shopping cart I used to use (Ultracart), there was integration with Endicia.com. However I found it very difficult to get Ultracart and Endicia to agree on the correct amount of shipping to charge. This meant needing to hand-edit XML files before processing labels.

The best time to try a service like Endicia is when you have hundreds of labels to print in a short period of time. They have a 30-day free trial and I signed up for it December 1st. This gave me a couple of weeks to noodle with it before I had to print 300 labels for holiday corporate gifting orders. I found out by the end of December that it wasn't worth paying the $29.95/month service fee.

What I like about USPS:

1) The provide many shipping supplies for free - especially boxes.
2) They deliver on Saturday for free.
3) I can drop off packages on Saturday - for free.
4) Priority mail gets everywhere in the US in 3 days or less.
5) The flat-rate boxes are THE BEST deal in shipping today.
6) I get to drop off my shipments at the receiving dock door so I never stand in lines - even on the busiest shipping days of the year.
7) Business addresses and residential addresses for the same price.
8) When I purchase labels online I save $$ - postage is less and delivery confirmation is free.
9) It's impossible to ship a package with a bad address (not the same thing as a wrong address: the software will not let you enter an address that does not exist - that's right, every single valid delivery address in the US is online).
10) Even though the counters might close at 5:00, the dock closes later (6:00 here in Larchmont - YMMV). I can't tell you how many times that extra hour has been necessary to get shipments out the door.


What I miss using USPS:

1) Point by point tracking of where the package is. I can tell that the package has been accepted by the Post Office and when it has been delivered. Nothing in between.
2) If I want to schedule a pickup I have to do it the day before.

Why I changed from UPS to USPS:

One day I looked at my bill and there was a charge for $10 that I did not recognize. I looked up the tracking number and discovered that the package had the correct address but did not have an apartment number. The delivery address was less than 3 miles from the UPS depot. The driver did not deliver the package but brought it back to the depot for "address correction" and they charged me $10 to "fix" the address and deliver the package late. Once someone sent me a package from Canada with about $70 of chocolate samples in it. UPS sent me a bill for $24 in customs charges. This was last of a string of nickel and dime charges that I'd see on my bill almost every month.

Since I switched I have never paid over and above postage and I've received hundreds of dollars of free shipping supplies (boxes, tape, label pouches, labels). In all this time (three years now), only one package has actually gone missing and I have never had a complaint about a shipment arriving in anything less than scrumptiously edible condition.
Clay,

This is a very timely thread for me. I will be setting up an online shop for my store. The one shipping agency I dread working with is USPS. I often will not go forward with orders if I discover that the shipping method is USPS. I have had packages that I was to receive lost for MONTHS (mostly international shipments). I had a passport lost, then recovered by USPS, only to be lost again by them...took 4 months to resolve and get all the documents returned. It is just my location that I have had problems with...having to deal with the USPS in my city on either shipping or receiving end is dreadful. I've never had the problems with USPS when living in other cities/states. However, if I'm to be successful serving customers, I will have to choose what works in my location (UPS has consistently been good for me here) -- I just wonder about the extra costs with going with UPS or FedEx. But again, if I get to the point where I'm printing hundreds of labels a month or doing massive shipping, I will consider myself lucky!

Kate
My issue with USPS came when they told me that they couldn't guarantee any kind of timely delivery in December, and their 2-3 day Priority Mail turned into 5-7 day Maybe Mail.

That said, if there's no time constraint and it's not December, it's the best deal available. If it needs to be there by a certain time, I use FedEx (drop-off as late at 8 p.m.!).

What about the summer? I use insulated boxes with frozen gel packs, and send FedEx Second Day, even to Florida in the heat of summer?

And I'm with Kate on having to worry about hundred of labels -- bring it on!

Brian
I've had the same problems with FedEx when it get's close to Christmas. This year the cutoff date by which they would no longer guarantee ground delivery on or before the 24th was the 15th - (though a couple of days later for large customers).

As for summer deliveries - I've had no problems with melting except in the one case where the package got lost. I have an unusual method of packing that I've developed over the course of the 5 years I've been shipping that I am very confident in. USPS Priority Mail from New York to Phoenix in the dead of summer - successfully.
Timely enough thread... just ordered $45 of chocolates...delivered via USPS (I was desperate to sample)...package arrived within 3 days, but all bars were broken. The chocolatier was amazing enough to offer to resend them, not necessary (they still tasted delicious!). But, if this had been a shipment for retail...aarggh! That would have been a real headache for all!

Kate
I've had stuff delivered broken via more different delivery methods than I can count. In every case, I was able to narrow the cause down to the contents not being packed properly. People just don't believe how carelessly packages get handled, even when there are "Fragile" and "This End Up" stickers. For what it's worth I've found that "Perishable" stickers work better. For some reason, if the driver thinks there's food inside they're more careful.
Clay,
I have used USPS for years and love it. Although, I used it mostly for my ebay store that I had. I continue to use them because of the integration between paypal and them. I like paypal although I don't like the look of it in my online store. It has it's trade off's. It's super easy to maintain, it's not that expensive for the small amout of online sales that I do and it's what I'm used to. I'm too busy to learn another program for the small amout of sales that I have online. I don't like to sell in the summer so I pull everything off my website but can start it right up again in the fall.
I do plan on selling on online food sites to push my sales.
Hi Clay, you asked:

Did you go with an online shopping cart or buy software and build your own?

We used the shopping cart OSCommerce for the Tava online shop. It has done a good job and has all of the features that we need, but it can be hell to customise and maintain. OSC is freely available (Open Source, so free to use and abuse). I do a lot of web development, so it was not hard for me. If you don't have that kind of experience, then I would look for something a little more pre-packaged. Many web hosts these days offer a shopping cart as part of their hosting package, which can be a cheap and easy option to get up and running.

My main comment about a site though is that it has to have good content to help draw people in. A case in point: I had a client take their business to another web developer a while ago as their online wine site hadn't generated any sales. They thought that it was my fault, despite only asking for and paying for hosting. They expected that just putting up any old rubbish would bring the sales pouring in. That will not happen. The Tava website gets lots of traffic and sales because it gives people useful interesting, accurate, information.

In short, your website should be an integral part of your marketing program, not just something that you stick up hope for the best.


PayPal or a merchant account for accepting payments?

PayPal for credit card and PayPal payments, but most of our transactions these days are by direct deposit to our bank account (in Australia). PayPal has been very good. It is cheap, easy and works. I have built other sites using other systems and none have been easier to get up and running with than PayPal. That said, PayPal's customer service, when I have had cause to use it, is truly awful. Don't expect much from them and you won't be disappointed.


UPS? USPS? FedEx?

Australia Post. They are by far the cheapest option in Australia. If we are sending a high value package, or shipping to a customer who may get upset, then we send it registered post (which gives us a tracking option).


Packaging supplies and charging for labor for packing.

Typically we don't charge for packaging, if we do, then it is a small amount only. We ship all of our products in recycled boxes, unless we can't get one that is appropriate. Our local supermarket crushes hundreds of good boxes every week. I would rather put them to good use. The one thing we don't have a solution for yet is bubble wrap. I have to come up with something to replace it.
That'd make a good survey too.. Average cost of good, sales, visitor, conversion rates..

While we're getting traffic due to our upkeep of the homemade chocolate blog, 90% of our sales are coming from those who know us ordering for those who are out of our area. We've yet to find the pulse of the online chocolate confection market.

We use Shopify, a pretty straightforward shopping system with an active user community and sub-developers. Like any shopping system it has caveats or head bangers, but less than others I've dealt with.

If you have volume get a merch account and keep your rates lower else it's a cost of business and paypal website payments standard does all we need.

Sticking for USPS at this time. While they are bridging the gap with packaging the more I do the math the more I think we'll save if we picked up our own, but that's volume like anything.

I make sure the cost of goods for packaging is zero'd out, labor is iffy still.

I am finding it hard to dual purpose a shop for local and online sales since we're more local perishable than online hard-goods. Writing copy and rigging the sales process can be a real task.

Doing business online is starting a new business. It's not just a website. It's a child that needs to be fed, talked to, guided, encouraged, refined, sometimes retaught, etc. If you neglect it, expect it to take on those attributes.

If anyone knows any further good directories, or stores to sell through, b2b, b2c ideas online I'd love to hear them.
I've been using a combination of Foxy Cart (http://www.foxycart.com), ModX (http://www.modxcms.com/) with me doing all the design and templating.
1. Foxycart is a monthly subscription (15-25 USD) shopping cart. It's very easy to set up and is more than enough to address most start-up's needs. Foxy cart requires you to use either PayPal (which i despise) or set up a merchant account and gateway provider (fairly easy process these days) which is the path I usually suggest. Unfortunately Foxy Cart doesn't integrate with the various shippers so it's a bit time consuming to create pick lists (Quick Books) and shipping labels (FedEx or USPS, UPS)
2. ModX is a content management framework that allows a user to set up templates (best created by a capable designer who has a bit of web technical knowledge). Once a template is set up modifying content is very easy for a business owner.

I've also look at Volusion (http://www.volusion.com/). they provide a subscription service with a plethora of marketing and management tools. Since I do web development I usually don't like to use a product like this because it feels restrictive - but for the money it's the best all-in-one ecommerce package I've seen.

Shipping
I offer UPS, USPS and FedEx. Cost wise I agree with Clay, USPS is the least expensive, however I tend to route all my shipments through FedEx. I've never had an issue with lost or damaged packages with FedEx. I also have a freight agreement with them and they have been fantastic with large shipments.
I have to say that I LOVE volusion. I"ve been selling water bottles on line for about 8 years on my website www.sunrisewd.com

Then I switched to volusion, and although I've done basic SEO ( am certified SEO consultant) I've already had sales on my new site www.thewaterbottlestore.com.

Which I attribute to two things: 1 a very focused site, with the basic SEO structure built out correctly. 2. Volusion's SEO friendly sites and great design for conversion. Although Volusion is a bit pricey, any new e commerce business that I venture into will be through volusion.
We originally had our web guy set up a shopping page on our site, but upkeep became more hassle than it was worth.

Now we've partnered with Foodoro, which takes a 15% commission for powering the cart and handling customer service. I'm loving it. Initial setup requires some time investment, but it's not difficult. Foodoro even turns your cart into an html widget that matches the look of your site for seamless integration. Now when I get an order Foodoro sends me an email with the pre-paid shipping label and packing slip attached. I just pull the order, pack it up, slap on the label and drop it off without ever having to contact the customer. My bank account gets direct-deposited once a month automatically.

I only do a small amount of business online--we mostly sell through our brick and mortar storefront. I've heard from fellow chocolatiers that they get more business through Foodzie than Foodoro but I haven't fully investigated Foodzie yet.

Here's the link to foodoro if you're interested: http://www.foodoro.com
and here's what our shopping cart looks like: http://thexocolatebar.com/shop.aspx

RSS

Member Marketplace

Promote TheChocolateLife

Bookmark and Share

Follow Clay on:
Twitter :: @DiscoverChoc
F'Book :: TheChocolateLife
F'Book Group :: LaVidaCocoa
Paper.li :: @DiscoverChoc

Badge

Loading…

© 2014   Created by Clay Gordon.

Badges  |  Report an Issue  |  Terms of Service