Its been the great debate around ebay these days, what is an appropriate cost for shipping and handling? 

Based on my experience, I have chosen to go with free shipping and handing.  I have read the arguments by the sellers with high shipping costs and they just dont make sense!  I figure the cost of shipping into the price of my items, and then get a great marketing gimic.  Now this does not work for every item, and heavier items are certainly not a good choice to offer free shipping on.  I sell mainly sunglasses which weigh in at around 4 oz.  This means I pay under $2 for USPS first class mail.  So why are most other sunglass sellers charging over $6 for shipping?  The cost of packaging perhaps?  I use manilla envelopes (they ae so cheap I cannot even give you a price) and bubble wrap that I bought off Uline (great website, check it out) for $30, and I have used this roll of bubble to pack at least 30 pairs of sunglasses and I have about half a roll left.  So I guess what I am saying is there are a lot of sellers who, in my opinion, are just trying to cheat ebay out of that extra 50 cents, mow that makes a lot of sense.

International shipping is just as cheap!  These same sunglasses ship to Canada via USPS airmail letter post (which is not offered by paypal, so I take the extra trip to the post office) for about $1.50!  Yes it is often cheaper to ship to Canada (you save on delivery confirmation).  So I offer free shipping to Canada too.  This is great for business due to the growing number of international bidders on ebay, as highlighted in a recent article in Entrepreneur magazine.  Other international shipping can be equally inexpensive.

I have found that even heavier items can usually be shipped for under $6 as long as you take the time to pack them right and use flat rate boxes and envelopes when necessary.  I have been known to shove everything into priority mail envelopes, purses probably being the most ridicules.

The final great advantage to offering Free and low cost shipping is that it distinguishes you from other sellers.  Although I love ebay, people often have negative experiences when buying, or hear of others misfortunes.  By offering free shipping, the buyer knows up front that you are not the scam artist that lurk in the auctions, with out having to take the extra step of checking your perfect feedback.  Make sure your auctions say free shipping, dont ever have your shipping cost say SEE DESCRIPTION!  Many buyers see this and say to themselves: what are they trying to hide.  A more experienced buyer will know that what ever it is, it can not be good.  In conclusion, over 25% of my sales go to Canada and I make more money than I ever did when I charged $12 to ship items that would cost $5 to ship.  You dont make money by being greedy, you make money by acting like you care (it helps when you actually do care).