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New UPS Flat Rate Box
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<blockquote data-quote="RustyPMcG" data-source="post: 776969" data-attributes="member: 30339"><p>A COGS of 75%? The only thing I sell that has a COGS that high is stamps. </p><p> </p><p>Any retailer is shooting for a COGS of less than 40% overall. You've got all your direct costs and overhead on top of that. Rent, utilities, maintenance, labor, interest, credit card processing fees, royalties, licenses, taxes, insurance etc., etc. all have to get paid out of the gross margin, and there are few retailers out there who can survive if their overall COGS goes over 40%. </p><p> </p><p>An electronics store might have a COGS of over 100% on some very hot item like the newest model of an iPod when it's released (yeah, Apple actually does have a wholesale price of more than the MSRP when they first release them), but the idea is to get the people in the store, and then sell them cases, chargers, extended warranties and other accessories that have a 10% or less COGS. But how am I going to get someone to accessorize a flat rate box? And that loss-leader iPod isn't taking sales away from some other MP3 player in the store. </p><p> </p><p>If the flat rate box is going to have a sales price point of $12, I need to get at LEAST $9 of that $12 for it not to adversely affect my business. And I'm not going to help promote it unless I get at least $11 of that $12.</p><p> </p><p> </p><p></p><p> </p><p>So what are the odds that someone making unauthorized use of a UPS account number is going to be giving me a valid credit card? And do you know the cost of complying with laws regarding keeping someone's credit card info on file?</p><p> </p><p>If they're going to do a lot of traveling, they should order some ASD's preprinted with their account number to take along with them. Or they can just pay for their shipping like any other business expense. They don't get to use an account number at the restaurants they eat at. They use a credit card that's paid by the company, or they use a personal credit card, and put it on their expense account. Or they can set people up with Campus Ship, and they can print their own labels when they need them. They have lots of options already.</p></blockquote><p></p>
[QUOTE="RustyPMcG, post: 776969, member: 30339"] A COGS of 75%? The only thing I sell that has a COGS that high is stamps. Any retailer is shooting for a COGS of less than 40% overall. You've got all your direct costs and overhead on top of that. Rent, utilities, maintenance, labor, interest, credit card processing fees, royalties, licenses, taxes, insurance etc., etc. all have to get paid out of the gross margin, and there are few retailers out there who can survive if their overall COGS goes over 40%. An electronics store might have a COGS of over 100% on some very hot item like the newest model of an iPod when it's released (yeah, Apple actually does have a wholesale price of more than the MSRP when they first release them), but the idea is to get the people in the store, and then sell them cases, chargers, extended warranties and other accessories that have a 10% or less COGS. But how am I going to get someone to accessorize a flat rate box? And that loss-leader iPod isn't taking sales away from some other MP3 player in the store. If the flat rate box is going to have a sales price point of $12, I need to get at LEAST $9 of that $12 for it not to adversely affect my business. And I'm not going to help promote it unless I get at least $11 of that $12. So what are the odds that someone making unauthorized use of a UPS account number is going to be giving me a valid credit card? And do you know the cost of complying with laws regarding keeping someone's credit card info on file? If they're going to do a lot of traveling, they should order some ASD's preprinted with their account number to take along with them. Or they can just pay for their shipping like any other business expense. They don't get to use an account number at the restaurants they eat at. They use a credit card that's paid by the company, or they use a personal credit card, and put it on their expense account. Or they can set people up with Campus Ship, and they can print their own labels when they need them. They have lots of options already. [/QUOTE]
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