Selling electronics products online. Shipping question.

[VEGETA]

Hi all, I live in Jordan and I wanted to buy from Digikey once... they told me I have 2 options for shipment: Fedex and UPS. We have a UPS center in Jordan so let's say I choose it for buying stuff.

Now, If I ran a crowdfunding project or selling a product to many people online, how can I ship it to them?

UPS take approximately 60$ from Jordan to USA for example, Aramix takes quite the same... my real issue is: If there are say 50 individuals from USA wants to buy my widget... Will I pay that 60$ for each and every shipment (to each one of them)?! the whole product might not cost that much?

I mean, is there a solution like shipping ALL these 50 products to USA, and then it gets distributed by some way? How does those who have experience in shipping products online actually handle this?

How about using the mail itself? (although they say it has a bad service here)

I am very sorry for all of these questions but I am very new to these stuff! Kindly describe the thing in details if you can.

thank you very much in advance!

[ivaylo]

Outsource assembly to China and ship from there. For whatever reason you can ship anythind dirt cheap out of China...

[jc101]

If you open an account with one the carrier companies, you can often get a job lot price for a batch of shipments - as a rule the more you ship the cheaper it gets.  The downside is they may well only let you create an account if you are a company.  Can't to any harm to give your local sales office a call and see what they can offer.

[mariush]

You may also look into making a deal with a company that would package and ship the stuff to customers for a small fee.  Send a single big package to this company and they'll put each product in a cardboard box and mail it to each customer and you pay the postage and a fee.
Or you could see if a company like Adafruit or Sparkfun would be willing to do it, but I doubt they're going to bother for just 60 items.

Amazon also has a system where you can send them the merchandise and then people can order it and Amazon sends stuff to customers and you give amazon something like 10-20% of the value of your product in fees...  But again, for just 60 items it's too much of a hassle.

[VEGETA]

can you guys name some companies (website)?

you said some companies get the shipment as one bulk and then they distribute it. does UPS have this? I saw that Adafruit uses UPS to ship items abroad.

the idea is not about 60 items only, say if it is a lot of items... same thing! i still need to ship one product to each customer and it is no sense to pay 60$ or so as a fee to UPS for each and every one of them.

[Shock]

You might not have thought about this but how much is your item and how much is plain airmail postage (commonly just called international postage now) to send your item.  Couriering mail through Fedex and UPS is expensive, especially if it's just a small box with components.

[mariush]

Adafruit and lots of companies use UPS because they sell enough stuff to get discounts on shipping costs.  Also, a lot of companies use UPS not necessarily because they're cheap, but because they have a good electronic system which makes life easier for companies... for example, you can print a label with all the information and have a tracking number automatically (more or less) and when you schedule it, UPS will come and pick the packages.

If i were to sell some stuff, I honestly don't know if I'd use the national post here in Romania, simply because it's just too much hassle. Let me give you an example..
They don't have procedures for companies that sell small amounts of stuff
Let me give you an example, suppose I have 20-40 packages that I want to send in the country or European Union.

I'd have to go with 20-40 packages (or whatever amount), ask the clerk there to give me 40 forms and 40 copies and for each package, I have to fill the form BY HAND and the copy with my address and the deliver address and the contents of the package (even though for EU it's not required). No, I can't download the form and make a script to auto fill addresses because that's too Then, i have to wait in queue at best 30 minutes to get my turn because there's only one or two clerks and the national post system still uses slow dot matrix printers and slow computers, and they refuse to upgrade or hire more people because they want to privatize and sell the company cheap - but that's another story.
Once I get my turn, the clerk there has to type on the computer my address and delivery address for each package, even though I filled the forms already by hand and they weight each packag, because who knows, maybe I try to scam them and steal a few cents worth of stamps. That's 3-5 minutes for each package - I once waited in queue about 25 minutes after a guy with 8 small envelopes in his hand.
So imagine people waiting after you, and imagine how much the clerks enjoy doing this - it's practically impossible.

Then for packages going outside EU, I'd have to go across town to the customs office, which is only open with the public for 4 hours a day, from 10 to 14 am. These guys also have their stupid rules: you must go with the packages open so they can check that the contents matches with what I write on the forms, so forget about packing stuff and adding protective material and so on because they'll pull stuff out if they want to.  Then there's another stupid rule that I think only in this country is present: the boxes must have no inscriptions on them whatsoever, no company logo, nothing.  If you go with a recycled amazon box or something, they give you white paper and tape to cover the box in white paper.

So yeah... it's cheaper? yes.. is it really worth it? if you send more than 2-3 packages a week, no, it's not worth it.
and then have the employee there weigh each package and type in the computer my address and the destination address for their records, AFTER I have to fill a form and a copy of the form with the same information by hand. I can't download  the form from anywhere, they don't allow you to give them typed forms (i asked), they have to be filled by hand just because they say so.

Very few companies here actually use the local national system to send packages, it's more convenient to use couriers even if they're a bit more expensive. The couriers have electronic systems similar to the ones the big UPS or DHL or similar companies use so you get a lot of value compared to the shitty national mail system

[VEGETA]

thanks Mariush, you wrote helpful info.

All of what you said is the same things that I imagined, and that is why I posted this. I think Dave can help a lot with this... cuz he actually tried it. It is "Australia post" I think.

And it is not economical at all to pay for shipping as much as paying for the product itself.

I think there must be some solution like shipping all packages at the same time then distribute it, but it may only exist in my imagination (or DHL?).

[jmole]

So I've got an online store (http://freesoc.myshopify.com), and I hit the same issues.

International shipping is ridiculous in terms of cost, for all carriers.

The cheapest way for me, shipping from the US, is to use USPS International small Flat-Rate boxes. These have a flat fee of ~$17 to Mexico and Canada, and ~$25 elsewhere. My logistics provider, shipwire, tacks on an additional ~$5 to each of these costs.

The big problem for me is that USPS claims delivery within a 7-10 business days, but depending on the destination country, this can get pushed out to weeks and even months. As a result, I end up with a lot of angry customers because of shipping hassles just like this.

The poster above who suggested China as a shipping option may have a point. Sure, it will take 2-4 weeks to arrive, but for free shipping, who can argue?

Another funny thing:  I have a PCB vendor in Malaysia that I occasionally use for simpler boards with not-too-stringent specs. For small runs, they can offer FedEx 2-day service to the US for ~$20. I imagine this is because FedEx needs to fill planes, one way or another, if they're heading back from Maylaysia.

Still, a frustrating situation all the way around.

My biggest piece of advice is: find a logistics company to help you with this. It will save you tons of time and headache.

[VEGETA]

outsourcing to China? I don't know how this is done.

anyway, my steps when time comes will be somewhat like this:

1- Buy components from Digi-Key and receive them.
2- send them to PCB manufacturer with the Gerber files... then receives all the finished boards.
3- Also, receive the housing/enclosure from manufacturer (maybe not too important).
4- receive the packaging boxes (custom manufactured) OR just do it via a local manufacturer.
5- Assemble the package. i.e, put the product in the housing, then in packaging, put manuals and other stuff in the package and then it is ready-to-sell.

Now I need to ship these ready products to each one of the customers, right? Here comes UPS! I saw from your e-shop that you use UPS despite high price.

This goes for selling direct. However, selling via a known store like Adafruit or so may be very easy where I can just ship all these products as 1 shipment to that distributor, but I am not sure about the profit here.. not to mention that the price of the product will rise more which is bad.

how about your experience in all these 5 steps?

[jmole]

outsourcing to China? I don't know how this is done.

anyway, my steps when time comes will be somewhat like this:

1- Buy components from Digi-Key and receive them.

I use mouser mostly, but yep.

2- send them to PCB manufacturer with the Gerber files... then receives all the finished boards.

Typically ship direct to manufacturer; less liability for missing parts when you can show them an invoice with quantities.

4- receive the packaging boxes (custom manufactured) OR just do it via a local manufacturer.

I got my packaging from ULINE (in US). They aren't boxes you could ship as-is, but they provide protection for the product. I then print my own labels for the boxes and attach them.

5- Assemble the package. i.e, put the product in the housing, then in packaging, put manuals and other stuff in the package and then it is ready-to-sell.

 Yep.

Now I need to ship these ready products to each one of the customers, right? Here comes UPS! I saw from your e-shop that you use UPS despite high price.

This goes for selling direct. However, selling via a known store like Adafruit or so may be very easy where I can just ship all these products as 1 shipment to that distributor, but I am not sure about the profit here.. not to mention that the price of the product will rise more which is bad.

I sell direct, for now, and outsource the shipping/fulfillment side to shipwire. So I send them a big box full of little boxes with my product in them, and whenever someone places an order from my web store, it's automatically routed to them and they pack and ship the order. This costs me around $5 per order, but it's well worth the time saved for me, since I have other obligations.

With a distributer like adafuit or sparkfun, you can expect a 30-40% markup, and have to plan the product pricing accordingly.

As far as directing traffic to your own webstore, that's a different story (and thread) entirely.

[VEGETA]

Typically ship direct to manufacturer; less liability for missing parts when you can show them an invoice with quantities.

hmm maybe i didn't get you here. I meant buy from Digi-key or Mouser, then receive them. After that ship them to manufacturer.

do you mean that let Digi-key/Mouser ship them directly to manufacturer with some agreement/arrangement?

I got my packaging from ULINE (in US). They aren't boxes you could ship as-is, but they provide protection for the product. I then print my own labels for the boxes and attach them.

I meant something like this one: http://www.peekpackaging.com/ < no idea about the cost though.

I saw that you sell the PCB alone which is what your product is. so you don't need enclosures and packaging. However, if there is a product like cell phones, multimeters,... etc it needs both enclosure and good looking package. this is a simple example.

I sell direct, for now, and outsource the shipping/fulfillment side to shipwire. So I send them a big box full of little boxes with my product in them, and whenever someone places an order from my web store, it's automatically routed to them and they pack and ship the order. This costs me around $5 per order, but it's well worth the time saved for me, since I have other obligations.

I think you get great profit by doing this. 5$ is nothing really. companies like Shipwire can solve the problem for me i guess. I just ship them one cartoon or a box filled with my packed and ready-to-deliver product. seems easy and perfect for only 5$. shipping 50 unites to that company can never be that pricey.

With a distributer like adafuit or sparkfun, you can expect a 30-40% markup, and have to plan the product pricing accordingly.

these are easier. they do the same thing as Shipwire but they have an audience and very powerful market. this is what you pay for i guess.

_____

I wonder how much manufacturing plastic enclosures costs.. you don't need it anyway ^_^. Your boards seems nice, what is your manufacturing company if I may ask?

[jmole]

hmm maybe i didn't get you here. I meant buy from Digi-key or Mouser, then receive them. After that ship them to manufacturer.

do you mean that let Digi-key/Mouser ship them directly to manufacturer with some agreement/arrangement?

Yes, just ship direct to them, and send them the invoice. Then they know exactly what to expect, and there are no arguments about missing parts.

I wonder how much manufacturing plastic enclosures costs.. you don't need it anyway ^_^. Your boards seems nice, what is your manufacturing company if I may ask?

A lot of the "niceness" is due to the design. However, I wanted to manufacture in the US, so i went with http://www.twistedtraces.com/

[VEGETA]

like telling digikey: "I want you to ship these items to this address which is my manufacturer"? does this work for them?

designing packaging is not easy and needs some experts... not that experience though. how much does it cost for you?

[VEGETA]

packaging seems interesting! i wish you could tell me how much did it cost you or any info or estimation you know.

regarding shipwire... i checked their site and they seem to have a nice pricing tool. i didn't understand what SKU means. it defaults to 50 and then have a bigger fee when it is more than 50... what is the situation with you about it? how many products to you sell a month? how about pallets? I think these questions are important for startups.

thanks for your time!

[mariush]

First result for SKU in google: http://en.wikipedia.org/wiki/Stock_keeping_unit

[VEGETA]

First result for SKU in google: http://en.wikipedia.org/wiki/Stock_keeping_unit

I guess example 1 suits us here. we ship one box full of say 20 products... so it is one SKU. right?

[ivaylo]

i didn't understand what SKU means

SKU is product identifier for a particular business. Say LT317 would be Linear's SKU for that chip. Not exactly the same but you can think of it this way.

[miguelvp]

i didn't understand what SKU means

SKU is product identifier for a particular business. Say LT317 would be Linear's SKU for that chip. Not exactly the same but you can think of it this way.

Not really, a SKU is the exact same part so LT317AT#PBF is a different SKU than LT317AHVH and different than LT317AK
At least that's the case in the software industry, a similar product intended for Europe instead of the US even if they have the same functionality but there are minor changes due to regions will have different SKUs

Edit: furthermore the physical copy of that software compared to the digital download of the same piece of software will have different SKUs because it's a packaging distinction.
so, it's intended for distribution packaging as well, meaning a way for suppliers and vendors to track inventory.

Edit2: and furthermore, same part shipped in reel vs in tray will have different SKUs and different quantities on the tape will generate different SKUs as well, so it goes beyond part numbers

[ivaylo]

And how does this help the OP 

[miguelvp]

Don't know, but the OP was confused what SKU meant on the last post from the first page.