I was always under the impression shipping was going up like everything else bec

Question

I was always under the impression shipping was going up like everything else because of the gas situation, but despite the decrease in prices, shipping is only getting higher and higher. Even small items like dvds that used to ship for 2 or 3 dollars are now shipping for nearly 7 or 8 bucks. I'm not talking about the ebay auctions that work low price into shipping, but a great deal of mainstream sites are charging crazy prices. If it wasn't the gas, then what's making shipping costs rise so much?

Explanation / Answer

You will be amazed at how the internet companies set their shipping charges to boost their profits. I worked at one of such companies where I learned how "shipping and handling" contributes to big profit margin on their income statements. We used to charge customers 7 to 10 dollars for accelerated shipping when it actually cost us around 2 dollars. Due to fierce competition, internet companies are using the "shipping and handling" to bring some more bucks and stay afloat in the market. Also, once commodity prices go up, its really rare for them to go back down again. In this case, if people act wisely and order from sites which provide free ground shipping, the average shipping cost will go down hopefully. Remember, as long as they are making money with this crazy shipping policy, they will keep doing it.

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