Always charge extra for P&P rather than fund it from the final price. I hate paying too much for P&P and it's annoying to pay £4 for something that turns up in a 2nd hand box with £1.75 in postage stamps. I try to strike a balance by guessing (thro' experience) the approx cost to ship to UK and USA and put that in the advert. It normally works out about right - I try to have about 50p contingency to cover brown tape and bubble wrap. I think I've gotten it wrong only twice and then only by less than a pound...
I buy quite small items - seller's P&P can range from £1 to £6. Anything over about 4 quid results in an email from me saying that I'd like to bid but their P&P costs have put me off. Sadly, I think some buyers don't care/notice this 'hidden' extra. I particularly like the 'buy from someone else' replies I get 'cos that's exactly what I do!
Recently I bought a dual sim card holder from HK - item cost 1p, P&P £4.99 - complete rip off as the actual postage was $3 (Hong Kong dollars) but the overall cost was half the price that they sell for in the UK. I guess the seller saves on fees but I'm really annoyed now as the bl@@dy thing doesn't work and the seller's command of English in emails has taken a nose-dive! I wonder if I'll get my 1p back!
Back to selling - check out the competition and ensure that your P&P is less (even point out that you ship at cost!) and you may sell more easily!
R2