Photo: Acroterion / Wikimedia Commons / CC BY-SA 4.0
Paterson, New Jersey clothing maker Todd Shelton began deducting return shipping costs from customers’ refunds this week – a first for the 23-year-old company – as small retailers head into the holiday season squeezed by rising shipping expenses, CNBC reported.
Founder Todd Shelton, whose eponymous company makes high-end men’s jeans, T-shirts and button-up shirts locally, told CNBC he is also considering charging for outbound shipping. He said costs are climbing for materials as well, including imported Japanese denim and shirt fabric from Portugal, and that while the company remains profitable, higher costs are eating into margins.
The squeeze extends well beyond one New Jersey workshop. The surge in fuel prices since the U.S. and Israel attacked Iran in February has driven up shipping costs by sea, air, rail and road. Global air cargo rates are running about $3.37 per kilogram, up 43% from a similar period a year ago, and Amazon reported an 11% increase in shipping expenses in the third quarter. Small business owners told CNBC they are weighing higher shipping fees or ending free shipping to keep up.
Evie Pearl Handmade, a Kansas City, Kansas seller of bows and quilted headbands, said a typical shipping label that cost around $4.50 last year ran nearly $6 per package last month – above the $6 shipping fee she charges customers, which includes packaging. Larger carriers and retailers can absorb the pressure more easily; smaller sellers say it is coming straight out of profit.
JBizNews Desk | Paterson, New Jersey
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