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What are some of the hidden costs when it comes to fulfillment?

We talked to some creators from our publishing category about some of the unexpected costs when it comes to fulfilling rewards, and collected their thoughts in a quick video. (You can watch it right here on our YouTube channel.)

Do you have experience with this? What were some of the surprise costs with reward production, packaging and shipping?

Kickstarter Asked on
12 answers
Campus is now read-only.

5

likes
Mark Harris
2-time creator
97
Answered on

Boxes for postage! Calculated all the postage, totally forgot about packaging!

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SMART GATOR LABS INC.
Creator
4
Answered on

It really depends on the quantity of what you want to send out at the end of your campaign. Are you sending or is a professional logistic company handling that. I would always prefer to find a professional logistic company, that is handling all for you.

ASk yourself following questions: 1. Where do the rewards come from? Asia, or some local suppliers?

2. When all rewards arrive, where should they arrive? At your place or at the logistics company? Logistics ask money for storing a product.

3. Do you need to bypack something? If yes, how do you by pack it? And who is by packing it?

4. Who is paying for the shipping costs? Are you dealing with DHL/UPS directly or has a professional logistic partner have much better rates with them?

5. How do you pack? Inner box outer box?

1 comment

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Alex Eames - RasPi.TV
8-time creator
353
Answered on

Returns, undelivered items and 'issues'. It'll be different for each project/product. But you should allow enough margin in your calculations for a small percentage of returns and undelivered packages. Some will probably go missing in transit too. Don't cut your margins too thin or you could end up in the red. :(

If you're unlucky or careless, you may find you have people who have issues with your product and need either replacement parts or a whole replacement unit. That will cost you too. Thankfully KS people are, by and large, very nice, so you shouldn't get too many fraudulent ones.

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Dave & Calvin Laituri
17-time creator
88
Answered on

Another tip is to ask your backers to give you an address where the package can be received by a person (parents' house, a stay at home neighbor, an office, etc) v.s being left outside on a doorstep or in the common area in an apartment building... where it could 'walk'. It will help reduce the number of 'lost' packages and the difficult decision to ship another. 

If you DO end up shipping another, insist on shipping to a different address where there is a receiver present... so it doesn't somehow happen a second time....

If a package gets lost along the way, it's not your fault - but your backers will usually try to blame you in some way!

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A Diva Difference, LLC
Creator
7
Last edited on

Thank You cards! :)

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Trevor Lehmann
2-time creator
48
Answered on

Replacement parts are big as well as shipping delays (October, December, and February) will add major delays if you are shipping to China

Returns are another big cost as well as the increase in postage between when your project ends and when it delivers

Ultimately, the shipping costs at your project's launch is a guess of what it will be when you deliver the final product.

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John Rap
39-time creator
86
Answered on

Cardboard backing.

For example, this is a recent true example, an envelope to Russia goes up from the price of an international stamp to over $9.00 when you add cardboard backing.

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John Wrot!
11-time creator
495
Answered on

Lost games that UPS won't refund the value of because they simply decided not to.  *ugh* : P

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Sean Tilley
73
Last edited on

The greatest hidden costs often have to do with the difficulty of manufacturing a product and shipping it globally. It is very important to consider your shipping strategy ahead of time - where are your rewards being made? Where are you going to ship your rewards from?

Depending on how a fulfillment process is put together, a project creator may find themselves using several different fulfillment companies to pursue fulfillment by region. Regional taxes and shipping fees can play a big part in accumulating cost. This can also increase in instances of damaged products or backers needing to ship their rewards back to a project creator

If a product requires licensing from a larger company - for example, a board game based on a popular television series - licensing fees could also be an unanticipated factor.

Full disclosure - this commentator works at BackerKit, a post-campaign platform for project creators.

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Gabrielle Motola
Creator
0
Answered on

If you are using a fulfilment company to store and ship your items, pallet storage fees and insurance (optional). They are not much in my experience (I am using a company called Pack-Smart) however I hadn't anticipated that. I hope this helps.

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Rajiv Ayyangar
0
Last edited on

For International Shipping... duties and taxes! It seems like a small thing, but customers can be ambushed with these and other extra fees, which causes immense dissatisfaction, and sometimes product returns. 

I'm a bit biased - we (Yakit.com) have a solution for this and have helped a few Kickstarters ship all over the world. However whether you use Yakit or not, the best thing for your customers is to ship "DDP" - or duties and taxes paid. To do this, use a service that calculates these fees up front (like Yakit!) - you can choose to pass these to your backers, or pay these yourself and charge flat-rate shipping. No one likes being ambushed by hidden costs. 

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kanhaiya
0
Answered on
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