Once upon a little girl named Goldilocks entered the home of three bears: Mammy Bear, Papa Bear and Baby Bear—or so goes the old children's bedtime story. Its moral differs from version to version, yet the "too hot/hard, too cold/soft, just right" theme is constant from telling to telling. How does an antique folktale relate to shipping and handling (S&H) charges for antiques and collectibles on eBay? As you probably guessed, this guide offers food for thought (porridge anyone?) to buyers and sellers as they set and rate S&H fees to determine if they are too high, too low, or just right.

According to eBay, sellers can charge the actual cost of posting a package for shipping, plus, the actual costs of packaging materials, plus a "handling fee in addition to actual shipping cost…if it is not excessive." This begs the question, "how much is too much?" And, given eBay's new seller rating system, buyers and sellers have another reason to ask, "What is just right" (or what is VERY just right!)? To stay in business, in addition to knowing their true S&H costs, sellers need also consider, "how much is too little?" (They should also consider market forces, which is beyond the scope of this guide.) When buyers evaluate and rate shipping and handling fees and when sellers establish them, in addition to being familiar with eBay's policies, it is reasonable to consider the cost of properly packing and shipping fragile items, including:

• PACKING MATERIALS (boxes, envelopes, crates, tape, cushioning, packing slips, ink, labels, "fragile" stickers, etc.): Using the right packing materials is essential when packing and posting antiques, collectibles, and other fragile items. Sellers either obtain, sort, and store their own packing materials or pay a professional packing and shipping service to complete thess tasks. One way or another, they pay for materials. Decent shipping boxes costs $1 - $25 each, depending on their size, quality, etc. (even 'free' boxes cost sellers in terms or storage & time). The cost of other packing materials can vary considerably. Depending upon the size and nature of the item (and whether the seller is a tape-aholic), and even if the seller uses recycled materials, packing materials can easily cost $2-$25 per package.

• LABOR RATE: all sellers incur labor costs associated with S&H. Some sellers have employees who prepare and post packages. If a seller packs and posts their own items, there is still an 'opportunity' cost. How much should anyone be paid per hour to S&H fragile items? One basis of comparison is to consider how much pack & post/mailbox businesses charge (they often cost more than most buyers seem willing to pay). Another consideration is that labor costs vary significantly from region to region. In CA, the minimum wage is $8 per hour; some businesses try to pay a "living wage," not just the minimum wage. Various data suggests the living wage in most major U.S. cities exceeds $15 per hour. So, when considering if S&H fees are reasonable, it is reasonable to ask, "How much should a person be paid per hour to properly S&H fragile items?"

• LABOR TIME: the time needed to properly pack and post each item varies from item to item and packer to packer, yet all in all, it can take a lot of time to ship a package (e.g., to find the right box, select the right materials, wrap and pack, make a packing slip, post). It can easily take 30 - 60 minutes to properly pack and post one fragile item. Large, complex, or irregularly shaped items take longer. A full set of china can easily take eight or more hours to properly pack and post. Long lines at the post office, lions and tigers and/or bears eating the seller's homework, computer malfunctions when printing online postage, etc. occasionally increases the time it takes to ship a package. Labor costs can easily add $3-$30 to the cost of packing and posting a fragile item.

• OTHER COSTS: Other costs associated with S&H vary significantly from seller to seller and item to item. It is reasonable to estimate these costs as being at least 50 cents per package. If one counts eBay and PayPal fees in the mix, this amount jumps to $3 or so very quickly for an item that sells for less than $25 and a lot more for higher end items.

• OTHER COSTS (international): Many sellers are happy to ship items to international buyers, however, shipping packages abroad can be a labor-intensive process – involving customs paperwork, tariffs and regulations.

• POSTAGE & INSURANCE: most shipping services have increased postal rates and have given sellers more work to boot because of increases in gas prices and the cost of various security measures. Savings associated with using 'cheap' shipping services are often cancelled out by added costs (e.g., pick up fees or added costs of dropping packages off at out of the way locations). Lightweight packing materials cost less to ship, yet the savings is often cancelled out by the increased cost of these materials. At the same time, if a seller skimps on packing to save on postage, it can cost more in the end because of the increased risk of breakage. Shipping insurance does not cover breakage if an item was poorly packed. Managing shipping risks comes with a price. In addition to the cost of using proper packing materials and practices, purchasing third-party tracking and insurance is one of the best ways to help manage risks. Since in many states, it is not legal for sellers to self-insure, third party tracking and insurance services are a reasonable part of S&H fees.

Considering the cost of materials ($2+), labor ($3+) and other costs ($1+) associated with properly packing and posting fragile items, in addition to the cost of postage, insurance and tracking, it can easily cost $6 - $36 (or more) to S&H a fragile item. Unless a seller has other means of support, one way or another, in order to keep selling, he/she must pass costs onto buyers. Given the other options (i.e., increased costs of driving to shopping centers to purchase items that might not be in stock), and the 24/7 convenience of online shopping, the benefits of buying online will probably keep eBuyers buying despite S&H fees (even if they do not like or welcome them). However, if eBuyers do not receive value in exchange for S&H charges, they will reconsider their shopping practices. Thus, well-informed sellers are motivated to keep S&H fees as reasonable as possible.

Many sellers build S&H costs into the price of the item, yet often this is not possible. This is especially difficult for an item sold via auction because it is difficult to predict the results. Thus, it makes sense for sellers to charge a S&H fee in addition to the starting bid. In contrast, it is easier to build some of the S&H costs into a BIN price. Some sellers build part of the cost into the item price or starting bid and charge the rest as a fee. Sometimes sellers willingly take a loss on S&H as a loss leader, yet this strategy only works if they can make up the difference on another transaction. If a seller allows buyers to return items "for any reason" (including if it is just a matter of the buyer changing their mind), they are more likely to charge "true cost" S&H fees instead of building the cost of such into the item. If they do not, they may charge a "re-stocking" fee.

Since there are many ways to pass S&H costs onto the buyer, it is important to note that the same item sold by two different sellers will more than likely have different S&H costs and it is doubtful that any two sellers would distribute these costs in the same manner. Thus, if a seller based in a high-cost area charges $15 for S&H when a different seller offering the same item charges $10, it could be that both S&H fees are "very" reasonable, even if one is $5 more than the other is. If the difference is $1-10, it IS logical to allow the different to inform one's buying decision, yet it is not rational to evaluate the reasonableness (or lack thereof) of S&H fees based solely on comparisons. Clearly, presuming all other factors are equal, if one seller’s S&H charge is $1000 and another’s is $1 for the same item, that is a different story. Goldilocks would proclaim the $1000 charge as being "TOO HIGH!" If the difference is minimal, however, even if the buyer does not like or want to pay the higher price, it is probably not fair to rate the higher price as unreasonable, because there could be a logical reason for the difference (i.e., the seller with the lower S&H fee has lower costs).

Another factor involved with determining if a seller charges reasonable S&H fees has to do with proper disclosure. Sellers should be upfront about their S&H fees even if it is not always possible to establish the exact amount prior to selling an item. The seller has a duty to provide buyers with sufficient information upon which they can make an informed buying decision. Just as the three bears were not happy to find that Goldilocks had eaten their porridge (without asking!), sellers should not surprise buyers with unexpected S&H fees. Along the same lines, some buyers have had the misfortune of being quoted one S&H fee and then charged another. I once bid on an auction because although the exact price was not specified, the seller indicated that they usually charged $12 - $18 for shipping, handling and insurance. Since the item I agreed to purchase was not unusual, I was 'beary' surprised (like a mad bear) when the S&H fee listed on the invoice was $36. That the actual charge was double the ‘come on/bait and switch' price seemed unreasonable to say the least.

All too many buyers have experienced situations like this or even worse, so instead of listing other examples of S&H fees that are 'too high,' I will move on to the other extreme. When sellers consistently charge 'too little' (i.e., no separate handling fee and do not build the cost of S&H into the item price), they are in effect engaging in a form of servitude. Naturally, this might not be as much of a concern to buyers as it is to sellers. What the heck, voluntary servitude is legal, right? If a person is trying to earn a living or supplement one by selling on eBay, if they consistently lose money on S&H, their efforts will not result in their intended outcome. Unless someone is doing eBay as a hobby, this practice is problematic at both the 'micro' and 'macro' level. When too many sellers work without covering their true S&H costs, it makes it difficult for other sellers to charge reasonable fees. Business enterprises that do not cover their overhead eventually go out of business. In the meantime, the deflationary effects of their practices put other sellers at risk. It also harms buyers because when sellers cannot cover their actual costs to properly pack and post items, their S&H practices will suffer and more items will break (ala Humpty Dumpty).

Shipping problems that arise when fragile, one-of-a-kind collectibles and antiques are not properly packed usually cost more than the cost of doing it right from the start because most shipping insurance policies will not cover breakage if the item was not properly packed. Reducing and avoiding shipping problems takes time, money, knowledge and skills. Most sellers cannot afford to provide S&H services without being paid for them, so they must pass the cost of proper S&H onto buyers via a handing fee or as portion of the item's price. When buyers evaluate and rate shipping and handling charges and when sellers establish them, considering the actual costs associated with proper practices can help them determine if S&H fees are too much, too little, or, as Goldilocks would say, "just right."

Once upon a time buyers and seller enjoyed lower S&H costs. Today, given the increased costs of postage, porridge, and packing, sellers who keep a handle on and cover their costs to properly ship and handle fragile items will be in a position to provide valuable services at reasonable prices. Of course, if the seller charges for a service that they do not perform, or if they are not upfront about S&H charges, they do not deserve the buyer's business. If buyers value the services rendered, and if sellers provide good service at the lowest possible price, we may or may not all "live happily ever after," yet perhaps we will find a happy medium.

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* Merriam-Webster online (accessed 08/02/07) indicates that reasonable means a: "being in accordance with reason (a reasonable theory)” b: "not extreme or excessive (reasonable requests)" and c: "MODERATE, FAIR (a reasonable chance) (a reasonable price)."

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