Erika Engle

Business aims to
reduce cost of online
shipping to Hawaii

OVERCHARGED for shipping an online purchase one too many times, computer engineer, home remodeler and online shopper Andrew Riehemann came up with a business model in which Hawaii's online shoppers could both combine and lighten the load.

ShipToHawaii LLC was established as a membership service designed to save shoppers 30 percent to 70 percent on shipping costs for purchases.

Those charges can be the bane of the online shopper's existence.

Some e-commerce sites ship free to Hawaii, but some that ship free to the contiguous 48 ice out states 49 and 50, charging rates equal to arms, legs and first-born children.

Riehemann is a new dad who has grown rather fond of his 20-month-old.

ShipToHawaii members' online purchases are first shipped to a Lynden Air Freight Inc. warehouse in Phoenix with a coded address. The parcels are consolidated and sent to Lynden's Honolulu warehouse on the next available flight. ShipToHawaii then notifies members their parcels are ready for pick up at its site near the airport.

Why Phoenix?

Customers making purchases from e-commerce businesses registered in the state of California must pay 8 percent tax, Riehemann explained. "I didn't want our customers to pay another tax."

Members using e-commerce sites that ship free to mainland states would be paying for shipping only between Phoenix and Honolulu. The service is available only on Oahu right now, but Riehemann hopes to expand.

It's hardly the first time necessity has been the mother of invention.

The idea was born after Riehemann was shopping online and found a large fan to help complete a home remodeling project last year.

The fan weighed 35 pounds and cost $400. Shipping it to Hawaii would cost $135. Shipping it to his father-in-law in Utah would only cost $8. The father-in-law was coming to the islands to help him install it, so he could just bring it as checked luggage, right? Wrong.

The package was too large and would incur extra airline charges.

Riehemann "bit the bullet," and got to thinking. He then got to researching and found "nobody was doing air freight consolidation" for small businesses or online shoppers.

"What I wanted to do was come up with a larger concept that anybody could use or take advantage of, whether a resident or a large business," he said.

Annual membership fees range from $20 for individuals to $75 for a small business or hobbyist, entitling each to ship up to 600 pounds a year. Large businesses pay $150 for unlimited shipping.

The prices don't include the shipping costs between Arizona and Honolulu. A 35-pound package about the size of a shoe box would cost $36.75.

Riehemann collects the membership fees while the shipping charges cover Lynden's expenses.

"I wanted to come in with the lowest rate so nobody could compete," Riehemann said.

Saving on shipping costs this way "does add an additional layer," and more time, Riehemann said. "What we were trying to do was provide, number one, a friendly face to work with and a trusted carrier," Riehemann said.

See the Columnists section for some past articles.

Erika Engle is a reporter with the Star-Bulletin. Call 529-4302, fax 529-4750 or write to Erika Engle, Honolulu Star-Bulletin, 500 Ala Moana Blvd., No. 7-210, Honolulu, HI 96813. She can also be reached at: eengle@starbulletin.com

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