From the 2nd of April Royal Mail business tariffs increase by an average of 11% but in some instances by as much as 63.92%. Add to that a further 20% increase by the addition of VAT to many of Royal Mail’s business services and prices are increasing by anything up to 76%.
Some businesses will be able to reclaim VAT but smaller businesses are not VAT registered and can’t. Coupled with the business rate rises, yesterday’s announcement that public tariff first class postage will increase by 30% and the cost of a 2nd class stamp will rise by 39% means just one thing – postage is going to cost more.
Introduced in 2010 for example the maximum you can charge to ship a CD or DVD is £1.25 and the most you can charge for clothing or shoes is £4.00.
Now that Royal Mail prices are set to rise is it time for eBay to revise the maximum postage rates that eBay sellers can charge? Many sellers already have to subsidise the postage that they can charge from the item price, it’s just not possible to post a pair of boots for £4.00 unless you have huge volumes. Private sellers are pretty much stuck with Royal Mail rates as they won’t have courier contracts and business sellers will struggle, especially those who sell items weighing in below 2kg which generally means Royal Mail has been the most cost effective option.
Will you be able to post your products at the new Royal Mail rates and still fit within eBay’s postage caps without making a loss? Are you looking at alternative carriers and who is offering you the best deal in comparison to the Royal Mail price increases?
If you think eBay need to revise the let us know in comments below. Equally if you can happily ship and your Royal Mail or courier contract gives you options that match eBay’s caps let us know where to get the best deals of shipping.