2006-06-30 14:41:28 · 3 answers · asked by Shagzter 1 in Business & Finance ➔ Small Business
The flat rate $1 shipping is their strategy for enticing customer purchase, improve customer retention, and make the customers come back again to them given the savings on shipping.
Note though that despite the free shipping offer, Overstock in the first quarter of 2006 grew 9% and but LOST $16 million. In the second quarter, they are again expecting to lose about $16 million. They're in a ditch, and giving away shipping is a strategy that they hope would attract more new and repeat customers. Overstock's net loss was $15.9 million, 8.8% of revenue, and $0.82 per share, compared to a 22% loss per share last year.
2006-06-30 15:16:26 · answer #1 · answered by imisidro 7 · 5⤊ 0⤋
Because they include few extra $$ on the merchandise.
2006-06-30 22:10:11 · answer #2 · answered by sudhirnayak@sbcglobal.net 2 · 0⤊ 0⤋
Volumne. They do not need bricks and mortar rent.
2006-06-30 21:47:08 · answer #3 · answered by rcb26 4 · 0⤊ 0⤋