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Attracting money to the Isle of Man - Selling with Ebay and IoM postage costs


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Posted (edited)
1 hour ago, ThreeRaccoonsInATrenchCoat said:

Are you thick? Sending anything off the island is significantly more than sending anything from the UK. 

I had to close down my Etsy shop because it became economically unviable thanks to the insane postage costs. For several years I just sustained the cost increases out of my profit margins but it has come to a point where the cost of postage means there is no longer any profit. If I continued to do business via Etsy, I'd literally be running at a cost. Thanks to IOM Post. 

 

Can I try and make an illustration, albeit oversimplified:

So for the sake of argument, let’s say I can bring £1000 to the Island but the cost of postage is £200. This makes it not worthwhile. So there is £1000 the Isle of Man could have brought in to the economy, but doesn't.

If IoM Post Office/Isle of Man Government subsidize postage cost by say £100 to make my business viable, then Isle of Man brings in £900 to the economy.

 

I must emphasize again that the postage FROM the Island is super quick. Provided a parcel is at the post office by late afternoon (varies at different post offices due to pickup times) it is on the plane that evening and gets to the Birmingham hub ready for distribution as quickly as any UK parcel. I just think that fact plays in our favour but the cost is killing what is effectively an export business.

Edited by Barlow
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7 minutes ago, Barlow said:

 

Can I try and make an illustration, albeit oversimplified:

So for the sake of argument, let’s say I can bring £1000 to the Island but the cost of postage is £200. This makes it not worthwhile. So there is £1000 the Isle of Man could have brought in to the economy, but doesn't.

If IoM Post Office/Isle of Man Government subsidize postage cost by say £100 to make my business viable, then Isle of Man brings in £900 to the economy.

 

 

I must emphasize again that the postage FROM the Island is super quick. Provided a parcel is at the post office by late afternoon (varies at different post office due to pickup times) it is on the plane that evening and gets to the Birmingham hub ready for distribution as quickly as any UK parcel. I just think that fact plays in our favour but the cost is killing what is effectively an export business.

Bingo. And this is why I no longer sell on Etsy or other platforms. Thanks, IOM Post Office, in your short-sighted self interest, you reduce overall revenue generation for the island. 

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There are a few internet and similar fulfillment businesses over here, but realistically they are selling low bulk/high cost items. 

Unfortunately there is an additional sea to cross so the comparative costs are realistically always going to be a bit higher. 

If you want to sell stuff as an internet business, you'll just have to sell more expensive (or smaller) stuff. 

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Posted (edited)
2 hours ago, The Phantom said:

There are a few internet and similar fulfillment businesses over here, but realistically they are selling low bulk/high cost items. 

Unfortunately there is an additional sea to cross so the comparative costs are realistically always going to be a bit higher. 

If you want to sell stuff as an internet business, you'll just have to sell more expensive (or smaller) stuff. 

I am just trying to think 'outside the box'. The scenario is very different from a UK business selling to a UK market.

It is IoM business selling to a UK (and beyond) market.

When you are posting Aunt Bertha in Barnsley a birthday present from the Isle of Man then you can expect to pay a higher price in postage than if you lived in Sheffield (or anywhere in UK).

But the scenario I am trying to paint is sending something from the Isle of Man to UK that is bring money back to the Isle of Man in exchange. Aunt Bertha's tea cosy is spending Manx money on the Isle of Man, other than that, it is generating no new income. My business is sending a widget to UK and in exchange is bringing money onto the Island - generating income. Postage costs are preventing, or at least hampering me from doing that.

 

 

.

 

Edited by Barlow
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3 hours ago, Barlow said:

But the scenario I am trying to paint is sending something from the Isle of Man to UK that is bring money back to the Isle of Man in exchange. Aunt Bertha's tea cosy is spending Manx money on the Isle of Man, other than that, it is generating no new income. My business is sending a widget to UK and in exchange is bringing money onto the Island - generating income. Postage costs are preventing, or at least hampering me from doing that.

It's an interesting point. I have 3 questions:

1. In terms of money creation, is the IOM actually a different economy given that we are part of the same sterling zone? Where is the money or value actually created?

2. To the IOM's advantage / perspective, is VAT a factor here for example - especially given that the spend is actually taking place in the UK?

3. Is there any difference for the IOM as a whole of govt subsidising the cost of post vs you paying the difference? What's the advantage of the IOM paying the difference in postal costs?

I don't know the answers to these questions but I bet that @Phillip Dearden does.

The sweet spot here, clearly, is non physical services which have no transport costs and which do not involve business travel.

Or - you take the order and your supplier dispatches the goods directly. You can do that from next to a pool in Bali. They will even issue you with a special visa.

Edited by pongo
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1 hour ago, pongo said:

It's an interesting point. I have 3 questions:

1. In terms of money creation, is the IOM actually a different economy given that we are part of the same sterling zone? Where is the money or value actually created?

2. To the IOM's advantage / perspective, is VAT a factor here for example - especially given that the spend is actually taking place in the UK?

3. Is there any difference for the IOM as a whole of govt subsidising the cost of post vs you paying the difference? What's the advantage of the IOM paying the difference in postal costs?

 

1. I would say not money creation as such, but taking money away from the UK and bringing it to the Isle of Man economy. For sake of illustration, say 85,000 people each sold 85,000 widgets at £1000, to people in the UK, there is a lot of money swilling about here all of a sudden. Those same people sold the same widgets on Island there is no national economic gain.

2. In my case no VAT but it is a good point. In principle I would say it is better to sell something than to throw it in the bin (but better to sell it in UK)

3. As illustrated in my original illustration, at present the business is not viable and the '£1000' is not brought to the Island at all, the widget is not produced and/or goes in the bin. If the IoM Gov subsides £100 postage costs, then £1000-£100=£900 is brought to the Island

(the UK gains a widget but loses the spending power of £1000 to its economy.)

 

 

 

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3 minutes ago, Barlow said:

If the IoM Gov subsides £100 postage costs, then £1000-£100=£900 is brought to the Island

Where is the advantage to the IOM vs you subsidising the postage?

Surely the thing is to find a niche which works here. Perhaps the Steam Packet could run a rival mail service - ie stick everything on the boat and post it in Liverpool.

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5 hours ago, pongo said:

Where is the advantage to the IOM vs you subsidising the postage?

Surely the thing is to find a niche which works here. Perhaps the Steam Packet could run a rival mail service - ie stick everything on the boat and post it in Liverpool.

The advantage is that IoM brings £900 into the economy for a cost of £100 (just made up figures for illustration). The alternative is £0 is brought onto the Island because I'm out due to not being able to compete with the UK Post Office.

The Steamie could run a rival mail service, but I have to say IoM Post Office are in a good position flying the post to the UK hub. It is very quick getting to its destination from there. It is also interesting that coming the other way post can seemingly float about on the Island for a day or two.

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Right then . . . I've had an idea.

In much the same way that Ebay offers to print a postage label (this facility is not applicable to IoM) the Isle of Man Government could do similar. So provided an item is being sold from Isle of Man and is being sent, and paid for, off-Island then a postage label can be printed. Various qualifications could be applied as necessary.

So there . . . . a way to bring money into the Island and stimulate the economy.

All I have to do now is get invited to a dinner party where an MHK can be worked on to make it look like it's their idea, 

 

 

 

 

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