I recently shipped a board game I printed to friends (more for fun than profit) and realized that shipping prices were a larger chunk of my budget than I intended. It got me thinking: how do big businesses like Hasbro afford to ship? Is there something I’m missing or is this just something they had to power through?
In: Economics
This is where economies of scale come into play. A company like Hasbro isn’t packing and sending individual board games to customers. They are sending 1000’s at a time to Target or Amazon warehouses. It’s more much economical to ship a pallet of games together than 1 or 2 at a time. Let’s say it cost you $20 to ship the one game. They might spend $200 to ship a pallet with 1000 games, or just 20 cents per unit.
And if you order that game from Target or Amazon? Well, they have bulk shipping deals with the carriers because they label and pre-sort their shipments, and because of the huge volumes they ship. And there are cost savings to selling online from a central warehouse vs. selling in a store that help balance the shipping costs.
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