Free Shipping is never Free – Watch the Videos for the Ultimate Truth
FedEx, UPS and Amazon make deliveries on behalf of retailers advertising “free” shipping. But, none of those packages are being shipped for free. There were over 131 billion parcels shipped worldwide in 2020, and parcel shipments are expected to double again in the next five years, possibly reaching 266 billion by 2026, according to Pitney Bowes.
The cost of shipping is becoming ever-increasing. Companies like Amazon, Walmart, Target and even Etsy benefit from economies of scale because they generate mass online sales. This puts them at an advantage toachieve bulk discount rates from carriers.
Watch the video above to learn why free shipping is a myth, what it really costs companies to send parcels around the country and how it impacts consumer sentiment.
CNBC
There were more than 131 billion parcels shipped worldwide in 2020, and parcel shipments are expected to double again in the next five years — possibly reaching 266 billion by 2026 — according to Pitney Bowes. “When consumers click that ‘buy’ box, they often don’t see the labor that leads to a box on their doorstep,” Ellen Reese, a sociology professor at UC Riverside and co-editor of “The Cost of Free Shipping: Amazon in the Global Economy,” told CNBC.
And those shipping costs are ever-increasing. “Anyone can offer an Amazon Prime two-day shipping. It’s just the cost that…might incur in providing that service,” Dhruv Saxena, co-founder of third-party logistics company ShipBob, told CNBC. He estimates it may cost a company anywhere from $25 to $35 for a typical two-day shipping rate.
CNBC
