Episode 96: Shipping Physical Goods
This week, Nick and Kai dive into the world of shipping for online businesses. (Hint: There’s a reason Kai likes selling courses!) We’ve both run businesses that shipped things to people. What does it take to ship things to people? Learn about Kai’s previous eBay businesses and how Nick handles shipping copies of his books to customers and clients.
Summary
Nick and Kai compare notes on running physical-product businesses: Nick shipping his book Cadence and Slang since 2009, Kai from his eBay days selling Magic cards and iPhones. They cover Media Mail rates, the address validation gap for international orders, and the policy decisions forced by returned packages. The episode closes on why physical goods still belong in a consulting practice even when digital delivery is cleaner.
Highlights
- Nick ships Cadence and Slang via Media Mail, a USPS service originally called ‘library mail’ and built for libraries to exchange books between each other. It later expanded to cover CDs and DVDs, and it prices books at a steep discount relative to first-class parcel.
- Nick uses Endicia (endicia.com, owned by Dymo) to generate labels. It queries the USPS API to validate and standardize US addresses before anything ships. No equivalent API exists for international addresses, so bad overseas addresses slip through undetected.
- Two thousand copies of Cadence and Slang weigh roughly 1,200 pounds. Nick flags reinforced floorboards as a real structural consideration for anyone storing that volume at home.
- After a package returns to sender more than once, Nick’s policy requires the customer to supply a completely different shipping address. The same address with an apartment number added does not count. He traces the rule to cases that cost $60 in product and $150 in shipping on a single order.
- Kai shipped a 30-pound box of Magic cards to France. It sat in postal limbo for three and a half months before returning, having lost 15% of its value in transit.
- Kai prefers digital goods partly because physical mistakes are unrecoverable. He once dropped an iPhone and shattered the screen, a $150 loss with no path back. A PDF cannot be dropped.
- Kai names ‘lumpy mail,’ sending a physical object via direct mail, as an underused tactic for consultants. His argument is that a shipped item can reactivate a dormant client relationship or open a new one in a way digital outreach cannot.
Read the transcript
So, one thing I find interesting is we’ve both run basically drop shipping businesses or businesses where we’re taking things to the post office with very, very very high frequency and sending them to people. And I thought it might be interesting to do an episode talking about the logistics behind shipping and the backstories behind our businesses, you selling your books, me working on different things, and just how shipping plays into Running an online business and what it does and what it’s like running a physical product business in some cases.
Yeah, sure. So my background, and then you should go into your background. I was an early project on Kickstarter in 2009. I ran a book called Cadence and Slang. It sold its entire print run within the first few months. That was about a thousand copies. And then has been selling at a decent clip ever since. I did a second edition of it. It’s been really great. And it used to be I had a full-time job when I had cadence and slaying, and my routine would be that At the end of the evening, I would, before I go to bed, I would just look at any new orders and I’d see usually two or three new orders, and I would print out shipping labels, slap them on some already packed um books and then on my way to work in the morning, I would drop them in a mailbox. That mailbox has been christened the Cadence and Slang mailbox to the point where people in Chicago take their stickers and put them on the mailbox and it’s covered with stickers. Yes. And it’s and then they replaced the mailbox and people like double down on it and did it again. Which is great. Keep doing that, everyone.
Time to email all buyers with a very special limited time offer for a four pack of stickers. Oh my god.
I’m gonna run out of stickers. The book has been selling at a decent clip basically for the past seven or eight years. Whenever I run out of books to ship, I just pack fifty more on my own, and that’s been pretty sustainable. It takes me maybe about half an hour to do that. And I leave them sit in my closet and then I slap labels on them and ship them off to people. If people need replacements, I ship them off to people. famous people or media people want copies, I usually ship them off then. And if you’re a professor isn’t listening to this somehow and you want copies for your college class, I’ll slap a sticker on an entire crate of them and ship it via media mail. The nice thing about living in the United States is because I’m shipping books predominantly, I can take advantage of a reasonably fast, highly discounted way of shipping books. And that is called Media Mail, which works for like books, movies. I forget what else. There’s like three or four things that fall into the category of MediaMail, but it predominantly needs to be exclusively that object. I’ll like include stickers and in practice the USPS turns a blind eye, but they’re there to ship books, right? And Media Mail was invented as a Way for libraries to ship books to one another, actually. It used to be called library mail, and then it became media mail as they started to do like CDs and DVDs and stuff like that. So that’s predominantly the thing that I ship, right? The other things that I ship include like welcome things for draft revised clients. Sometimes they get those. or gift boxes which I will send from the greatest business in America, Zingermans, and they end up taking care of all the shipping for me. But effectively there’s you know Shipping at scale, which is challenging. I’ll invite all my friends over and we’ll do packing party. Storing things, which I have a lot of closet space in my new house, so I’m able to actually pull that off. and servicing things. So if copies are damaged in transit or they don’t show up or people deliberately just give you crappy addresses that don’t work, and then you ask them for a new address and they give you the same address, et cetera, et cetera, et cetera. there are a lot of challenges. So tell me about your background before we get into the challenges.
Sure. So I’ve run two businesses that are very shipping focused, physical good focused. One was in both were eBay businesses. One was Selling Magic the Gathering cards, and the other was the iPhone business, buying used iPhones and then selling them on eBay. And I think one interesting distinction between the two businesses is. I was selling goods that I was buying and then immediately moving. I was buying magic cards and then listing them same day, same week, same with iPhones and electronics. You have. a library of goods where you have the good already printed, assembled, packaged, ready to ship, and you’re waiting for the order to come in. So there is a slight difference in the business model there. But on the shipping side, oy V shipping problems, my friend.
Yeah, shipping problems are a lot of challenges. So one of them is international shipping. Everybody has to worry about this, but when you’re in the United States and you have to ship a book internationally, all of a sudden you’re not using Media Mail anymore, you’re using first class parcel because it’s more than three quarters of an inch thick usually. And that means that you’re shipping it as if it’s a package, which means you have to use first class. That costs a lot more money. So you need to make sure you’re collecting those shipping charges and you’re charging people fairly in the U. S. You have a rate for the United States, which is cheap. Canada and Mexico have their own rate, which is slightly higher, and you’re still shipping via first class. And then the rest of the world has the same shipping rates. So it costs just as much to ship to London, which is crazy. London. six hour flight from Chicago versus New Zealand, they cost the same amount of money. And that’s the fortunate thing for your shipping system is you can you know actually collect money. But make sure you’re not getting burned on international shipping. That’s the first thing. Second thing, and this specifically applies to international shipping, your shipping provider, I use Indisha, E-N-D-I-C-I-A. com. They’re owned by Dymo. They’re like they connect to the USPS API basically. When I type in an address that’s in the United States, it queries the USPS and validates the address. So it adds the four digits to the zip code that nobody remembers, and then it changes avenue to A V, changes the floor and suite and all that, and like Standardizes and finesses the address. And if it can’t and it chokes on it, then it sends back, hey, there was an error, and then I can go and email the customer before I ship their thing. This is the key thing. There’s no API for any of the rest of the world. So I am at the mercy of your entering things properly. And you would think that customers know what their own address is.
No. Gosh, no.
Some people have better things to care about in their life. I have literally received. Here’s a great thing. I’ve literally received addresses that took the form of. Directions for the mailman. Like, take a right at Muhammad’s house and walk three steps and ask the clerk where to go. I have gotten that in an address field. The mine package. Did you ship the package? No, I immediately asked like a million pointed questions about the actual frigging address of their their House. That’s not an address. No.
Now I tell you, selling on eBay. It’s a little better in some ways because you have forced form field, da da da da da. People are entering good addresses, people have entered an address on their PayPal account. But at the same time, like all the crazy shipping disasters and all the crazy shipping stories you could imagine have happened. I had a package that I shipped to France. Be returned, get lost in the mail, get stuck in the holding pen for three and a half months before it was finally returned to me. This was a gigantic, probably 30-pound box of magic cards, and it just took forever for it to circle its way around the world. And by the time it made its way back to me, it had lost 15% of its value. It was cool.
My record is people I’ve gotten four returns and it was just somebody specifying the same address with more granularity. So now draft mandates. If something gets returned to sender, we as a matter of policy either refund you and salt the earth, or you specify a uniquely different shipping address. It must be uniquely different. It cannot be the same address with apartment tacked on. You must give me a completely different shipping address. This is usually not a problem for people. They have a home and a work address, or they can give it to a friend, or something like that. You would not believe there are just some people, some people push back on this. And that’s why we have to have the policy is because there are just a few dumb, crappy situations where we end up losing like $60 worth of product and $150 worth of shipping charges, sending the same crap over and over and over again.
I tell you, and that statement right there is exactly why I’m more interested in building businesses around digital goods than physical goods. You could ship replacement products. You eat the shipping cost, you eat the product cost. I remember dropping an iPhone once and having the screen chatter and just being like, well. I lost $150 right there with that dumb action. And you can’t do that with a digital good. You can’t have that happen with a PDF, workhorse, or an e-book, or whatever. It’s, I think, so much nicer to sell digital versions of objects in terms of delivery because you don’t have to worry about these pain points. There are other pain points, but. You don’t have to worry about the shipping problems that come up when you’re dealing with physical goods.
Yeah. So as a consultant, it’s sometimes important to be shipping physical goods. Here’s some good examples. Welcome boxes for new clients. A lovely gesture. Physical books. Maybe a physical newsletter. Any sort of information or thought leadership could be tremendously helpful for your consulting practice. It is for mine. Absolutely. um zines, one-off gifts, anything like that. But eventually you have to think about doing that either at scale We’re dealing with nonsense. If you’re just shipping off two or three things to a client, like you don’t need to buy in D show, you just go to the post office and be done with it, right? But if you’re me, you’ve been shipping stuff since time immemorial, and you know exactly how large physically 2000 books is. Mm-hmm. It’s pretty big. It’s a good amount of books there. Pretty heavy.
You know how much that weighs. Oh, I’m going to guess twelve hundred pounds. Twelve thousand pounds. No. Not 12,000.
No, no, no. 1200. Close around 1,200. It’s like 2,200 for cadence. Which is a lot. That’s over a ton. Right. And that means you have to have like reinforced floorboards in your house. You know, like that’s an actual consideration.
Mm-hmm.
So, yeah, yeah.
Yeah, there’s a whole amount of challenges there. But, I mean, on the flip side, like I don’t think there’s anything more delightful for a client or a customer than receiving something physical in the mail, be it a welcome packet, be a newsletter, be it a journal, be it a gift box, be whatever it is. There’s a power that physical objects have that digital objects just do not. And even when we look at something like courses, I think For a buyer to receive a box in the mail with the DVDs, with the information, with the workbooks, you have these tangible objects. You have spent some money and now you have a physical thing, it’s a lot different than spending money and now you have access to a course site somewhere and you’re able to take the class online. Like there’s An inherent value to receiving the physical object that is lost or transferred or transmuted in some way when it comes to it being a digital object.
Yeah, no, I think that’s absolutely true. The surprise you get from getting something in the mail, it’s like genuinely shocking when it’s not just Amazon. com, right? Like. Someone thought of you. Like it feels more sentimental almost. And I know that’s crazy, but it’s the honest truth.
Now, I think shipping physical goods to clients. It’s an underused way to reactivate a relationship. It’s an underused way to build new relationships. That you have the whole concept of lumpy male that Any listeners in the audience who are interested in direct mail marketing tactics, lumpy mail is something you should be researching. But reaching out to people through shipping them a physical good could be a great way to stimulate a conversation and start a relationship with them in a way that you can’t through digital means.
Yeah. Yeah, it’s important. I mean, I remember I was on a phone call with somebody, God, it must have been over a year ago now, like a year and a half ago, something like this. And we were talking about brown MMs for a little while. And I didn’t know this, but unbeknownst to me, he was Amazon priming me a pound of brown MMs and they showed up on my doorstep the next day. I’ll never forgive him.
If only there were a different color MM. Oh, goofed up there. Pretty horrendous. Goofed up there. Pretty horrendous. But no, physical goods, I mean. They have their upsides, they have their downsides. I think it’s interesting. We both have operated, and in your case, are operating businesses that ship physical goods to customers. It’s an interesting aspect of business, and I think it’s In a lot of ways, if you’re a consultant or an agency who has a book, you could easily create a product and/or physical product out of that book and have it as something you send to clients, or have it as something that you make available and sell, and either add a new revenue stream or have some physical, durable. Object you’re able to share that represents the knowledge or the skills that you’ve built up to that point that you’re now sharing with the world.