Sometimes I think that we, as a country, have a very short collective memory. Once again fuel prices are on the rise; this time not due to a shortage of any kind, but rather to "speculation" regarding troubles in the Middle East. Once again the rise in prices is beginning to take a toll on almost everything we do day to day, and of course, with the economy only now staggering back to its feet, we should definitely be concerned as to the affect rising prices will have.
But right now, I want to briefly talk about what this situation can and eventually will do to those merchants who sell on-line. Shipping services like UPS, FedEx and the Post Office will naturally have to raise their prices to compensate for the cost of fuel. There's really not much else they can do; after all, these are not non-profits we're talking about. The problem, of course, is that merchants will once again either have to bite the bullet and absorb these increasing costs, or they will have to pass those costs on to the consumer.
There was a time when I provided free shipping for all of my items. Unfortunately, that isn't the case anymore. I try to keep the shipping costs as low as possible, and will charge slightly under the actual shipping costs. With this latest round of increases in fuel, I don't know how much longer that will be feasible.
There are a lot of merchants out there who sell large volumes of relatively inexpensive items, but I question how much longer they will be able to continually do so. When the cost of shipping becomes equal to or greater than most of your inventory, somethings got to give. Customers are only willing to pay for convenience up to a certain point. After that, they'll jump in their cars and drive to to the nearest mall to purchase more inexpensive but necessary items.
I think what this may do is to eventually eliminate the ability to purchase low cost items on-line. Eventually, you may only be able to find the rarer or more expensive item on-line, as the profit margin for these items will make selling them on-line and shipping economically feasible. Regardless, an increase in shipping costs is rarely if ever a good thing. For on-line merchants, it can only be a cause for major concern.
