Free Shipping Hides Other Fees

Overhype

from the look-out-for-that-handling-fee dept

A while back, while working with an e-commerce company, there was a question how much we could charge for “shipping and handling” – with the mysterious “handling” being the loophole we were hoping to use to eke out some extra profit. At the time, we were told by lawyers that it wasn’t legal to jack up the shipping and handling fees beyond what the costs really were. Either we were told incorrectly or the laws have changed, because everyone seems to want to squeeze more out of their shipping and handling fees. According to this article, companies like Buy.com, which claim “free shipping” to entice buyers have been sneaking in extra “handling fees” at the very end of the purchase process. Buy.com claims it was a mistake, and they’ve changed the system (and are refunding the handling fee to those who paid it). However, many believe that this is the wave of the future. Just as many service companies add in tons of extra fees, now e-commerce sites are exploring the idea of adding extra fees to sneak some more money into their margins.