Is it worth paying more for faster shipping?

by Torley Wong on 12 January 2009 22 comments

"Free shipping" is often advertised as attractive bait for you to take action and buy something! That is, until you find out it's not free after all. In other words, an absorbed charge. For example, I love Amazon.com. Their selection is generally excellent and their service is unrivaled (over the holidays, I got a reply on Xmas day when I enquired about undelivered goods). But if you've compared their prices with other online stores, you'll notice unless it's an especially killer deal, they'll factor shipping into their at-face cost.

The same has applied to Zappos (which has prominently advertised "free overnight shipping" and tried to differentiate with no-hassle support), eBay (where it's determined per-seller) and other places: whenever you see "free shipping", take a closer look at that total number and discern whether it's really gratis, or if you're paying a few bucks on top. It usually doesn't amount to more than a tip at a fine restaurant, but nonetheless, it's best for you to be aware.

Amazon has also had great success with their Prime program. Here's where they advertise "all-you-can-eat", free 2-day shipping for $80/year. Plus, $4 extra for each item gets you 1-day shipping. They're savvy enough to lure you in with a free month trial, and that's exactly what happened to me. My subscription just ended yesterday, and I'm going to renew — I've noticed better deals are on the horizon like this 3-month trial w/eligible textbooks.

Before answering:

"Is it worth paying more for faster shipping?"

First ask yourself:

"How much is my time worth?"

As bitter as the economy can be, the fact nevertheless remains: you can make more money. You can't make more time. This is a hard rule of how the universe works. Sometimes this traps us, like people paying more for guaranteed before-Christmas delivery because they procrastinated. It's times like these where it's advantageous to have a flexible lifestyle: not paying attention to social pressure when it comes to holidays, and setting your own rules. Not everyone has that luxury, especially if you have to dig yourself out of a hole of awkward family traditions.

That being said, here are some tips worth applying:

  • There's often a huge cost jump between 2-day and 1-day shipping, and that price often isn't worth it unless something is "mission-critical". (We aren't talking delivering organ transplants here.) You can easily observe this cost jump by visiting any web store that lets you preview shipping before checking out. (Some places are awful and require you to sign up for an account, or get to the final stages before checkout.) Other World Computing is a fine example of informing you about shipping beforehand. There, 1-day shipping can be double (~$22) what 2-day shipping costs, but the gap between 2-day and longer periods is less.
  • It's best to buy in the morning. Or more accurately, before the day's cutoff date: if you place your order too late, it doesn't get processed until the next day. Amazon has a handy countdown clock on numerous items, something I wish more places had: I've tested this by placing an order within the last 1-2 minutes, and got my goods on time. Other stores offer a rush processing fee, like Newegg's $3. General consensus is this isn't worth the minimal trouble if you order fresh to begin with. Like shopping in the supermarket, be early in the queue.
  • A little cost is worth a lot of convenience. Don't be foolishly thrifty. This guideline is especially true if you're putting together a new computer with accessories and expansions, as I experienced with my Mac Pro last month. I didn't want my performance to be bogged down waiting for RAM (which is far cheaper to install yourself than from Apple), so I selected 2nd Day Air @ OWC. Saving money is good, but spending money selectively where it makes a substantial improvement to your experience is even better. I find this is reinforced if I'm ordering something expensive. I get anxiety waiting too long for it to arrive, because even with today's tracking systems, I wonder, "Is it alright?"
  • Arm yourself with good package tracking tools. Even if you've paid for faster shipping, there's still a chance it may take longer than expected. Check the store's shipping policy ahead of time: in Amazon's case, if they can't live up to their $4-for-1-day guarantee, they'll refund the shipping cost. I've done this twice and they've been very prompt about it. After you get an order receipt, it's common to see tracking numbers in there. Go to the right link and bookmark it, and check it daily (if it's important). On Mac, I favor the Delivery Status Dashboard widget. It's nice and elegant, altho I wish it could autodetect the shipping service from the #. There are also cross-platform websites like TrackThePack.
  • Amazon Prime has no weight or dimensional restrictions. I wish I could apply this broadly, but I don't know of anywhere else that has a model like Amazon. If you buy a 200-lb. piece of exercise equipment, it's still $4 for 1-day shipping with Prime. Those moments are really worth it, because many places charge shipping by weight or dimensions. But remember, Prime only makes sense if you order regularly from Amazon — say, over a dozen times a year or if Free Super Saver gives you too much of a headache to push just a wee bit over $25. Also, items must be "Prime Eligible", meaning Amazon, not a 3rd-party retailer they list, carries it. Again, consider convenience over cost and what you're willing to dish out.
  • Keep gas costs in mind. This was more of a factor months ago, but with black clouds still looming overhead, and if your vehicle is a gas-guzzler, I think the lesson's well-burned into you: if it's going to be a long drive to a store that's got something in stock, it may be worth both the time and money to have it delivered to your door instead. Once more, contemplate what might be a better use of that time — relaxing, painting, reading the Wise Driving Guide? :)
  • Don't put it off. It's the most obvious thing in the world, but unless you can time-shift your holidays and aren't under familial pressure like me, plan and execute with extreme lookahead. Rushing also leads to poor decisions and compounds buyer's remorse, since you have less time in which to make sensible decisions. Remember that procrastination is average, not an exceptional outlier, and all that waiting and lazying around will cumulatively clog up the pipes at Xmas, Valentine's Day, etc. You, on the other hand, should be ahead of the game.

Do you think it's worth paying more for faster shipping? Share why or why not!

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Guest's picture
theFrugalUser

Amazon Prime is a great deal. One thing to note -- Amazon Prime can be shared amongst members of the same household - so you and your significant other can both get use Prime delivery, or you can share an account with roomies. Credit card info is kept separate.

Linsey Knerl's picture

Torley,

This article rocks!  I love how you broke everything down for us.  I didn't even know about the $4-for-1-day guarantee on Amazon. This new info alone will save me so much time and money!

Linsey Knerl

Guest's picture
ecochic

... having an online order shipped to your home or to your local store (when possible)? I've had "online-only" items sent to the store for me to pick up because I needed other items that I wanted to investigate in person (namely from Best Buy and Kohl's). This post made me wonder ...

Are there some figures comparing direct and store shipping? We drive a 2006 Honda Civic, the gas mileage is great and we always run our errands together to save trips. Does the whole delivery process uses more gas and/or dirtier fuel? If companies consolidate the regular stocking and internet order shipments, I'd think that would be more efficient than a separate, special trip to an individual home.

Guest's picture
Guest

I've had Amazon Prime for almost a year now and it's been a tremendous savings...in both time and money.

Even though I live in a major city, it takes money (busses, subways, cabs) and lots of time to shop around for stuff, particularly when you can't even find out if something you want is in stock at a specific retailer for a price you want (and even if it is, they won't hold it for you so it could still be sold out when you finally get there.)

With amazon prime, I've been able to get gifts out more quickly; get stuff needed in an emergency (when we lost our gas, we had an electric duo burner the next day for less than it cost to take the bus to/from Zabar's; a huge insulated chest (when our refrigerator died and days before it could be delivered, which saved a lot of $$ for frozen food plus we can reuse the chest)and lots more office products, computer items, etc. for our home office.

In terms of price, you do have to be careful and know what the comparative prices are both online and off. But we've found tons of food and cleaning items, as well as toiletries that are cheaper and more convenient (delivered to our door) than schlepping around the city and trying to haul them home from all over. It's really been a huge convenience and with their subscription saver discounts, big $$ savers as well.

Again, if you don't buy much or don't order very often, it may not be a savings. That was our main concern, but at what comes out to about $1.52 a week, it's an investment that has really paid off.

Now, if only we could order from Costco and those big box stores that way. (We don't have a car so we don't have access to those places.)

On the other hand, let's talk about the time it takes for items that are shipped at regular shipping fees or free from other online vendors. Sometimes it takes over 10 days from some places. The prices may be "cheap" but waiting 10 days (we're not talking media mail, here, either) is really inconvenient for a lot of items that we're buying because we actually need them (versus nice to have).

So it's really all about what you buy, when you need it and how much you're willing to trade off.

And the article makes a great point about knowing when the cut-off order times are. That can make a huge difference.

Fred Lee's picture

Good advice. I'm a sucker for free shipping, but since I'm generally not pressed for time and am patient when it comes to spending money, have had nothing but good experiences with free shipping on Amazon, and for that matter, most retailers. I, too, did Amazon prime, but didn't really buy enough to warrant it and when it expired I did not renew it.

I personally loathe shopping, so comparing gas costs is not an issue since I refuse to go to the mall. Then again, when you have kids, you often have not choice.

Guest's picture
lucille

We use Amazon for some specialty grocery items, supplements and some soaps and such. Since I keep these things stocked up I reorder before we run out so ship time isn't an issue. I also frequently find things on Amazon I can't find locally. My only issue with Amazon is that some of their resellers are not so great, others are and you don't have much of a way to tell.

So far in the last year I have been able to get free shipping on everything I have bought online with the exception of eBay purchases and one Amazon purchase. I would only use expedited shipping if the item was holding up the ability for someone to work or otherwise be properly productive.

Guest's picture

I sell stuff on eBay. Before Christmas they were giving discounts on listing fees if you offered free shipping.

However shipping does cost money. So of course it would be built into the price. If you don't want to pay shipping buy locally. In most cases it can be cheaper.

I tried selling on Amazon but stopped. They set the sipping fees and in most cases it did not cover actual shipping costs.

Guest's picture
Liza

I have used Amazon Prime since they offered it. My reasoning is simple. I order most of my holiday gifts through Amazon. The savings in free 2-3 day shipping on those items pays for the Prime service for the rest of the year. So, all the books I buy are shipped for free then. I almost never pay for the 1 day shipping -- 2 days is fine. I then also shop Amazon first for many other purchases and as long as Amazon's price is CLOSE to the best deal, I'm fine with it.

I'm not sure that it works out to a money savings in the long run. If I didn't have Prime, I probably wouldn't buy so many books however, it does improve my quality of life.

I'm waiting for my Kindle to arrive. It will be interesting to see if it is still worth it to pay for Prime now that my books are arriving directly to my Kindle for free.

Guest's picture
Richard

I consider next-day service or buying at a B&M store at inflated prices an "Instant Gratification Tax"; you pay more, but you get your item immediately/sooner. Some people are ok with that.

Guest's picture

If I needed an item that fast, I'd go to a 'brick & mortar' store. I do a lot (i mean A LOT) of shopping online, and I generally use free shipping coupons with the understanding that it may take a little while before my items arrive.

I've never had the need to use expedited shipping. For me, as a quasi-frugal fannie, it's just a waste of money.

I don't think I've ever paid shipping at amazon, so this amazon prime business is totally not for me.

Guest's picture
Amy

I would agree that rush processing is definitely not worth it at newegg. I tried it once and since I ordered in the evening, it didn't help at all. They usually process orders very quickly anyway.

Guest's picture
THOR

I placed a rush Newegg.com order once, but when UPS fubared the shipping and I didn't get it by when I should have, they were more than happy to refund my expedition fee.

Guest's picture
Craig

No, that's the simple answer. Definitely not worth paying for faster shipping. Nothing you buy can't wait to come in the mail.

Guest's picture
Roberta Hundley

Wrong! My dogs wireless fence that we borrowed from a friend had to go back unexpectedly because he got a new unexpected dog. I had to get another fence fast and found a phenomanal deal on amazon.Saved me 250.00 . Couldn't have bought one otherwise.Paid expedited shipping to keep my dog in the yard. Got it in 3 days which may have taken 5 or more who knows? Usually can wait on regular usps service but here is one time I needed it quick.Thanks for your comment but I guess it depends on the circumstances.

Torley Wong's picture

@theFrugalUser: Indeed. I should also note that Amazon specifies such an arrangement is for *families*, and the hilarity/controversy that erupts on various forums/blogs when strangers start coming up with "virtual families" to partake in a deal like this... and make it even "sweeter". Officially it's not allowed.

@Linsey: You're most welcome! Thanx again for such warm continuing support, I appreciate your roundups & contributions.

@ecochic: In an era where boffins are figuring out how much energy one search query takes, I would think more data on this would be readily available. But maybe not too many of them are deals mavens, because I haven't come across a study yet — but would like to.

There's so much variance, too: if you live in a distant rural area vs. a suburb, for instance. So while specific calculations for individual circumstances could be useful, to broaden that too much would be abstract.

One helpful thing I've heard an increasing amount of recently: if you have a smartphone/Internet tablet/laptop/etc. that can browse the Internet when you're *in* a store, compare online prices with store prices, and see if you can have something ordered with in-store pickup to save. E.g., http://lifehacker.com/5130053/use-best-buys-in+store-pickup-to-save-seri...

@Guest: Great story. Thanks for sharing your experiences. I've looked at Costco online as they offer some items the warehouses don't carry, but shipping prices can be prohibitive.

@Fred Lee: I find that if you're an adept planner, then you can order stuff well ahead before you might want/need it. Impulse buys, as I tend to allude to, are in the midst of poor decisions.

@lucille: What you mention makes me think of online grocery delivery businesses which haven't panned out to be all that successful.

With Amazon resellers, have you checked the onsite ratings? They do have them, so you can get some idea (like eBay) of a place's reputation.

@Jim: That's helpful context. I didn't know that re: listing fee discount. Time to time I notice grouped behavior on eBay and wonder "What happened here?" For example, the other day, a whole bunch of SeaGate FreeAgent Go 250 GB drives went up — turns out there was a hot Office Depot deal days before, so, lots of resellers.

@Liza: Good thinking. When I've spent enough time, then I'm not going to quibble over savings, and "CLOSE" is enough for me too. Hope you enjoy your Kindle; I've held off until the next generation but I'm hoping that longer-term, investing in a capable eBook reader will save me shelf space.

@Richard: Yes! Definitely.

@Zen City Chick & Craig: Sounds like you're living life at a non-rushed pace, then? Like the old saying: "Good (or some say, "all") things come to those who wait." :)

@Amy: Thanx for chiming in!

Guest's picture
Kathryn

On the time=money front: I live in a fairly congested suburban area, and the closest box stores (less than 5 mile radius) are 20-30 min round-trip driving time, not including the time cruising the aisle and standing in the checkout line. Because my freelance work is the sort where it's pretty easy to turn time saved into money earned, I figure a typical trip to the big box store to get something costs $30-40 of "lost opportunity."

On the eco front: 95% of the delivery truck's route is in the trunk route shared between hundreds or thousands of packages, and only a small portion is the little side trip to your house (anywhere from a block or two, to a mile?). The the delivery truck is going to be more fuel-efficient traveling that short little segment to your doorstep (let's say 1 mile, which is probably generous on average) than you would be traveling 6-10 miles RT to the store, even if the delivery van is getting, say 9-10 mpg (which I think is about typical).

However, the green consideration *does* go out the window if you opt for express service that involves air transport.

Guest's picture
Catana

Another angle on Amazon shipping. If your item qualifies for free shipping (over $25.00) they say that it will take five to nine days. If you opt to pay extra, it will only take two to three days. I've ordered free-shipping items twice and opted not to pay the extra. In both cases, the item was sent via FedEx, two day delivery. On my last order, a bread machine, I could have thrown away $15.00 for shipping and not gotten it any faster.

Greg Go's picture
Greg Go

I'm an Amazon Prime subscriber.  I split it with my housemate and we use our own credit cards, like theFrugalUser (#1) points out you can do. 

I love it.  But I consider it a splurge rather than a money saver.

First, I didn't pay anywhere close to $40 in shipping for books before I got Prime.  I always bought in $25 chunks so I would get free shipping. 

Second, I buy more now.  And buy faster.   One-click shopping + "free" 2-day shipping = me buying a lot more books.

Having said that, I will probably renew my subscription when it expires.  I'm hooked on  2-day shipping.

Prime must be a huge money-maker for Amazon....

Guest's picture
Jennifer Lloyd

Some retailers ship so quickly that the extra cost for fast shipping isn't worth it. In my experience Amazon, NewEgg, and Crucial have been excellent in terms of order fulfillment and shipping.

Many e-retailers offer free shipping from time to time, and it pays to take advantage of these offers if you can.

Amazon offers Super Saver Shipping for free on qualifying purchases >= $25.00. I always receive my purchases well in advance of the estimated time. Unfortunately this option is not available for third-party sellers.

Guest's picture
THOR

My original intention was to use the Amazon Prime free trial over the holidays and then cancel at the new year. I forgot and was ashamed that I wasted $80.

My wife's in the last semestre of her Master's program and needed me to order her seven books for her classes. Some of the books she needed by week's end, and some of them she didn't need for a week+.

* My AAFES discount with Booksamillion netted me something like $128 +shipping, and some of the books wouldn't even ship for up to four weeks!

* Half.com got me the (used) books & standard media mail shipping for just under $100. The delay between how long the shipper has to confirm & ship your order and then the up to 14 days that they stipulate their shipping may take, was a possible upwards of three+ weeks for arrival.

* Amazon.com got me all seven books new for ~$117, and with my accidental Prime membership, free two-day shipping. I placed the order Sunday evening (the 18th) and UPS dropped off a box from Amazon on the porch this morning.

Win.

Guest's picture
William

The thing about Amazon Prime two day shipping is that it's two BUSINESS DAY shipping. So unless you order it by Wednesdays cut off, you won't get it until the beginning of the next week, because that two day shipping isn't delivered on the weekend. At least the free super saver shipping would get delivered on the weekend. If I had known that before I signed up, I would have skipped it and stuck with just buying things with the free super saver shipping. I don't know if the extra one day shipping includes weekends yet, but I've already paid extra for prime to begin with, and am not about to pay more to get something on the weekend that they should do to begin with. I admit I felt a little swindled when I discovered this.

Guest's picture
Seth

The BIG key with Amazon is that they are NOT losing money on Prime at all.

Use two different computers; on of which you haven't logged on as as you. .e., no cookies.

COMPARE THE PRICES!!! Prime members are charged more typically.