Can Free Postage Cheat You Out of the Best Deal?

Written by Ian Davis – Bullion Manager • Last updated 17 Dec 2018

At Chard we’ve been dealing by mail order since 1964. We always aim to provide a good service, yet in recent years we’re asked more and more frequently why we don’t offer free postage?

It has become common for retailers to offer free postage – the aim being to give the customer something for nothing. While this seems like a fantastic deal for the customer, sometimes you could actually end up paying more. Here we explain why free postage is not always as it seems.

Is "Free Postage" Really Free?

In most cases, no!

Most people realise that "post free" means the seller has added the postage into the price already, but many people don't.

This means goods at one store could cost you £20 plus £3.99 postage, whilst another store offers them for £25 with ‘free’ postage. The aim is to make it look like the customer is getting something for nothing but as you can see, you can easily end up paying more.

There's No Such Thing as a Free Lunch

This is an old adage and truism, but it serves to remind us that very few things in life or business are actually and truly free.

Easier Price Comparisons

As a customer, if you want to compare the total cost of an order, you need to know the total price including postage and packing. Some sellers advertise a temptingly low price, but then make it back by adding excessive shipping costs, a bit like Ryanair used to do.

It is not always easy for us to quickly and easily show total prices including shipping, but we are working on it, and will add more about it further down.

Hidden Charges

Whilst lots of retailers add the postage onto the cost of the product, we like to keep our prices as low as possible. We’re open and transparent about the premiums we charge on bullion, therefore we wouldn’t want to add any additional postage charges onto them. Furthermore, if we did incorporate a postage fee into the price, we’d let you know about it - but then that would defeat the “free postage illusion”, wouldn’t it?

Historic Reasons

Although, as coin dealers, we have always offered a mail order service, we have always maintained a physical "shop" or showroom presence, or "bricks" as it is often now termed.

We have always priced on the assumption that much of our trade, and many of our customers, will visit us to buy (and sell); it has always been fairly simple to work our a fair charge for postage and packing, and this has worked well for more than 50 years. Although we launched our first website in 1998, this was essentially simply an extension of our existing mail order operation which enable us to reach buyers and sellers more quickly and efficiently, even over long distances; the main change is we now need more expertise on international shipping because the internet reaches an international audience, is not just a "local" U.K. one.

Whilst we’re happy to refund any postage paid if you’re collecting, we're pretty sure that the small number of bullion dealers who do offer collection won’t refund any of their "free postage".

"Free" Postage Often Costs More

There are many ways and reasons this could happen; buying more than one item is a good example; do you get a discount if buying in quantity? If not, then you are almost certainly losing out, because the trader will have added the postage costs to the single piece price, you end up paying multiple postage costs whenever you buy more than one item. If the trader adds postage costs separately and transparently, then the customers will only pay the appropriate postage cost.

Let's give a simple example:

Dealer B sells an item for £55 "post free", and a customer buys 2 of them, the total cost if £110.

Dealer C sells the same item for £50 plus £5 shipping when a customer buys 2 pieces, his total cost is only £105; saving him £5.

Following this same example, the more a customer buys, the bigger his saving from dealer C.

By adding the delivery charge on afterwards, it actually allows us to offer the best option for your order, and keeps costs down, rather than using a “one-charge-fits-all” method,

You Get What You Pay For

At Chard we offer two kinds of delivery within the UK; uninsured second class or fully insured Special Delivery. It's important to note that our postage charges include additional insurance which isn't provided by Royal Mail.

If we were to average the cost of postage plus insurance and add that charge onto all of our products, some of our lower value goods would increase in price dramatically.

Furthermore, we don't charge postage per item. We can combine the postage up to certain weights.

What About for Local Customers

If we offered "free" postage we would have to increase our prices on specific products or just in general as the costs of our delivery service do not become free themselves, we still have to pay thousands of pounds to get your orders safely and confidentially to your delivery address. If your local enough to our business to pick up your goods, or want to pop in about a jewlerry order, maybe visit the beach or have fish and chips in Blackpool you will inadvertently be charged a higher price even though you are picking up. We do not believe it is fair to charge customers who do not use our delivery service a higher price just to offer "free postage" to others. 

When Chards Offer Free Postage

We will occasionally run a promotion on certain products that when bought in multiples your order qualifies for free delivery. On these occasions, this is an offer where you stand to save on postage costs without being subject to a price increase on the underlying products. This is often a short-term offer on stock lines we wish to promote and once they are gone the offer is also over. Therefore our advice is that if you see Chards offering a free postage deal do check out the deals as you can stand to save quite substantial amounts.