How can you be ripped off by a free offer? Here's how: Out of curiosity, a friend of mine --a financial maven -- ordered a so-called free tape or CD touting tax tips. He just wanted the 411 on the financial information. Of course, the recording was free, but the shipping and handling charge was about $6. He ordered anyway.Scene Two: The tape or CD arrived and it contained worthless information that anyone could discover on the Internet or at the library. Getting his money back was a problem. Technically, he did not make a purchase and the company only billed for shipping and handling, a service that arrived as promised.
Scene Three: The financial maven was tempted to dispute the inflated shipping charges. (It probably cost less than $1.50 to ship via the Post Office media rate.) But faced with the time obstacle of spending well over an hour (or more) to fight a $6 fee, our family friend opted to just write off the expense. He estimates that the bogus company must make a fortune on similar freebies.
I was reminded of his experience today, while listening to a radio. The Pitch: How to make money selling iPods, Plasma TVs via eBay. A Complete How-to! No risk! Free!! There was no mention of the shipping fees: But I can guess that S&H is high enough for the vendor to make a tidy profit on high volume sales, but low enough that ripped off consumers will just eat the loss.
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