Price increase questions
The USPS is raising rates again. This is the third year in a row that my postage costs will go up. The cost to ship one pouch of tea in the US has gone up 12-cents, 24-cents and now another 25-cents. It will now cost me $2.32 to ship a single pouch of tea. Paypal charges me 54-cents for one $8.99 order, so now we’re up to $2.86 from $8.99 BEFORE we even talk about the cost of tea and packaging, etc. Of course, it’s an even bigger chunk from the weekly subscribers (particularly the 26- and 52-week subscribers) who get a price break.
I really WANT to keep offering free shipping, because I know a lot of people enjoy picking up the current Tea of the Week and don’t want to feel like they have to order more than that to make it worth paying the shipping costs, and I don’t want to discourage that. I also currently have so many places on the web that mention the free shipping that it would be a hugely daunting task to try to remove them all and I would still run the risk of missing some and having people upset because they thought we offered free shipping.
I feel like I have a few options:
Absorb the price increase and HOPE that this translates into folks seeing that we are not as expensive as they think, leading to more sales at a lower margin. [You guys shop for a lot of tea, do you think we are too expensive? Do you get the feeling that people think we are? Do you think our prices discourage some folks from buying?]
Raise the price of individual teas a bit. Maybe offset that with an ongoing discount on purchases over a certain dollar amount.
Start charging for shipping. MAYBE even REDUCE the price of our teas and charge for my actual postage costs.
Maybe there’s something else I haven’t thought of.
I’m just wondering what you guys think. It’s enough to make me want to pull my hair out.
PS Costs to ship to Canada and overseas have stayed at current outrageous levels, so this probably won’t have a major impact on international orders unless I make major revisions to the way we do things.
Honestly, I think I’d have a lot harder time justifying the number of purchases I make if it started costing me more than $10 a pouch, but I’d be plenty willing to pay anything up to and at that cost, though. I really appreciate the free shipping, so I wouldn’t really be hugely put off if I saw the price of tea go up to 9.49 or 9.99 to help out with costs as long as that stuck around.
I’ve been toying with the idea of maybe making them $9.99, but then doing something like we’ve done with the Southern Boy Teas and say (for example) if you buy four, you get them for $8.99. Hopefully, that wouldn’t be too crazy to try and figure out with our software. lol.
This: Start charging for shipping. MAYBE even REDUCE the price of our teas and charge for my actual postage costs.
Plus a shipping break or free shipping if you reach a certain amount.
I’m only speaking for myself here, of course, but I find $8.99 for sometimes less than 1.5oz of tea a bit expensive. I still buy your teas, but I’m used to paying less – just as an example, another small-ish tea-ery charges $4.50 for most of their teas for an ounce and they often run codes and have free shipping over $50. I’d personally buy more if you lowered the cost and then charged for shipping, but that’s just me!
Agree, with the above. I enjoy your read but I haven’t purchased since the last price increase, especially with the shipping to Canada.
Charging for the shipping does have some advantages. I can link the USPS postage rates directly to the cart and charge customers exactly what I will pay in postage and in the future, if postage costs go up, the shipping costs will adjust accordingly.
My only concern is that this will strongly affect the folks who just want to buy one pouch of the current week’s tea. Even if I cut the price to $7.99 and charged the $2.32 in postage that I would have to pay, it would send the cost of one pouch over $10.
I appreciate the input though, particularly your honest assessment of our prices.
While the transition might be a bit difficult, I believe you would be better off by charging the shipping. $9.99 for 1-1.5oz of tea is just too steep for me. I like the Southern Boys discount type idea. I also like the idea of, if you buy $35 in tea, you get free shipping.
I am not in the US. But for purchasing tea, the cost of tea and shipping is sometimes a factor. If it is a tea I really want or love, I will pay whatever the shipping is no matter what. However, if I am just interested in trying a tea, the cost comes into factor. So I think your long time customers would still remain as long time customers.
I like your idea about discounting the price for a larger order.
In Canada, mail prices just recently had a HUMUNGOUS jump. For some Canadian tea companies this made no difference – shipping prices appear to have remained the same, and other just started charging at the new rates. I don’t think there is anyway around increasing postal rates (it happens between once and twice a year here). It would be expected as the cost to deliver the product goes up, the cost to the consumer goes up. But I certainly understand you wanting to keep your customers happy and not to lose them.
In Canada, I don’t think I could ever receive a tea package and only pay $2.86. So in my opinion, it doesn’t seem like that huge of a jump – although I completely understand that it is different in the US.
Is there anyway to decrease the cost to yourself by changing the packaging of the tea or of the mail package?
I really appreciate all of the feedback you guys are giving.
I’m thinking now maybe I should just leave the pricing the same and maybe add a small shipping surcharge on all orders under a certain amount. Maybe like $2 for orders under $20.
I second the true shipping charge and free over a certain price point suggestions. A cool thing I saw on another site I shop on was a ‘you could add insert product here without increasing your shipping charge’ pop up. I’m always buying the little extras they suggest cause it seems like a deal. Might be a cool tweak for you.
I would have to say too that your cost on teas is a little steep for me as it is since you don’t readily offer samples & I don’t know if I’m going to like what I order. I know I can most likely trade for other teas here on Steepster if I don’t like what I ordered, but then again, more fees to ship for trades.
As a newbie in loose leaf teas, I find I figure shipping costs as part of the whole cost of the tea. When I find a few favorites, I may change my way of thinking if it means stocking what I “need”.
I do like your idea of leaving the tea prices where they are and charging a bit more for a small dollar amount like you mentioned.
That said, I love your concept of weird and crazy flavors and look forward to trying a few summer iced teas.
Maybe think about doing a few more samples now and then for those who are new and would like to try your blends :)
I do get a lot of requests for samples. The tricky part about that is that unlike most of the other tea companies out there, we stick to creating small batches of new blends all the time. By the time we sent samples out, and people had a chance to try them, it would likely be sold out and we’d be on to something else.
You do seem yo have a few teas that stick around. Maybe just a pack with a few of them would be nice. I understand packaging is an issue too probably, more time consuming, maybe even more costly. Possibly if you just did it a few times a year it would be nice to have an introduction to some of the favs that stay around awhile. It would keep you from having to stock samples all the time, but offer the chance for a limited number to go out for those who make their purchase decisions from samples.
I did see your Christmas special, but decided against it because being new to loose leaf, I wanted to spread my dollars and try a few companies.
I didn’t mean to change the subject.. Sorry!
Suziqzer – 52 teas did a bestsellers sampler pack this Christmas as well as 12 days of Christmas sampler pack. Although it is not until the end of the year, that might be a good option for you.
Suziqzer, you could also set out to see if anyone has the 52Teas flavors that your curious about to swap, give a way or sell. I mean yeah alot of times it might be a tea that has gone out, but Frank does do reblends if a tea gets requested alot…(If I remember correctly.) on the Zoomdweebies website of the teas that are out of stock, there is a button to click on to request for a reblend of that tea. It is thanks to giveaways, and tea stash sales that I’ve gotten the chance to try more of Frank’s Teas, which has increased my general inclination to buy, Particularly the various flavored Genmaicha blends!(I really liked the Razzleberry Genmaicha. And Witch’s Brew tho not a genmaicha.) Though due to not earning enough to really justify the tea purchases I want to make and have already planned other orders is why I have not ordered any recently.
A sampler offered at various times of the year would certainly increase my inclinations to buy from 52Teas, like a sampler of 4 would be a good number. Like maybe with a theme. For example: Spring/Summer fruity teas are fairly popular (My favorite, really year around.)
I’ve skimmed through everyone else’s responses here but I would be a little sad if you raised the cost of the individual teas anymore. As a Canadian customer I already feel like I pay a ton for shipping (which I know isn’t your fault at all and that you already take a hit on that because of the increase last) and since American customers currently don’t pay you for shipping, I would have to limit my orders more than I already do because it would make the cost of one pouch outside what I would feel was reasonable/could justify to my husband. I hope you look at keeping Canadian/international orders the same or offering us free shipping over a certain amount too because I continue to love your teas! I have an order on the way as we speak.
This. I have considered making my first order with you for a while now, but as an international customer who has to pay the massive amount for shipping anyway, I would feel put out if I were forced to pay more for the tea so that the American customers could keep their free shipping, which doesn’t affect me anyway. It would most likely stop me from placing an order.
Only speaking for myself: As much as I appreciate free shipping, I would be willing to pay for it, both to help you out, Frank as well as lessen the cost for international customers.
The mention of a surcharge, have no idea if that would help alot more….Frank, have you implemented that? If so, does it help?
I think a lot of people are understanding like Lynxiebrat, but even if that’s not their main focus, I think a lot of American customers would benefit from separate shipping too, as if they order quite a bit, they may be paying for more shipping than is needed if the shipping fee is added onto every single tea.
I think I’d be happier if the shipping was separated from the price from the tea.
As a Canadian I don’t get free shipping anyway, but maybe this way each individual pouch would be cheaper, and the total shipping cost might work out cheaper? (i.e., instead of $8.99 per pouch and shipping, maybe it’s $6.99 + $3 shipping for X amount of teas, and $10 shipping for YY amount of tea)
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