Saturday, April 30, 2011

Thanks USPS!

Ever since January I've been concerned with what our shipping and handling process and pricing would look like for Phase 1.  Since all products will be available exclusively online S&H pricing is going to play a major part in whether consumers ultimately decide to purchase.  I scheduled sometime with a USPS employee and got some very good news this morning.

1.  As long as our package is less than 10 ounces we can ship anywhere in the continental US for a flat rate of $2.90.  Since I'm trying to keep the total cost (candy bar cost + S&H) to around $5 this is very good news.  Why $5?  Internally this is around the number where we think consumers are willing to take a flier on a new product.  In limited sample testing as we reached higher $6 and $7 price points willingness to try decreased in concert.

2.  My second concern was melting, especially in the warmer climes during the warmer months (I'm looking at you Tejas).  She said typically first class standard can get the package anywhere in 3-4 business days which should be fine for chocolate.  Writing "Heat Sensitive" on the package may help alert USPS personnel along the supply chain to take extra care but generally we should not expect problems with melting.

Pricing is a big part of our strategy.  Although our product is gourmet and produced with the same care in which your grandma prepares holiday desserts we wanted to compete, from the jump, with Snickers, Hershey's and Baby Ruth on price for a standard candy bar.  This S&H new allows us to do that!


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