Here's how I handle it - I know some will disagree with me, but that's the best part about running your business: YOU get to decide what kind of customer service you want to give and what works for your profit margin. I have been all over the place, and last year finally sat down and looked at my numbers hard core for the type of traffic that my website does. This works for how my customers order soap online and still keeps me profitable.
I do a flat rate shipping fee of $4.
The rare customer that orders 1 bar, this covers 100% of their shipping (6x9 padded envelope, USPS first class).
For two bars I can ship for $4.75, so I only pay an additional 75 cents for that order, which my profit margin on two bars can easily cover without breaking bank. Seriously, if losing 33 cents on a bar of soap causes you heartache, then you need to readjust your pricing. (Again, this goes in out a 6x9 padded envelope, USPS first class)
For three bars, things get tricky because I can get 3 bars in the 6x9 envelope, but it costs around $5.75. $1.75 cutting into a 3 bar profit is a bit hard for me, but at this time I have only sent out 3 bars once since I switched to my flat rate shipping.
Anything over 4 bars I ship in a priority mail padded envelope for $8. A 4 bar order is a rare occurrence as well. Most of my customers who order online will order their soap for a whole year - so 10+ bars is a typical shipment for me. Covering the $4 shipping difference on a $60 order is pretty much pennies at that point.
For really large orders (for example, I have one lady who orders 40+ bars and 100 lip balms every year for Christmas gifting) I will switch to a USPS Regional Mail box. Those really large orders are typically custom, so I have to invoice them separately and will increase the shipping rate to $10. I think the example lady's order this year cost me $12 to ship that way. I haven't had a regular online order that I've had to switch to a Regional box.
I think the most important thing is that I have my prices set to cover costs - I factor in sales taxes, 15cents per bar for shipping materials, and fees that I have to pay for online sales and CC fees. My retail price is typically 4.5 to 5 x my costs. I've worked extremely hard over the last year to keep my costs low so that I can still make an affordable "luxury" bar of soap at a reasonable price and be able to factor in these costs without the customer feeling the pain or losing my shirt.
