I do shipping at my company, and just pass along the UPS charges. Doing this is loosing my shirt. In addition to UPS charges I need to provide a shipping employee, his insurance and benefits, a space for him to work, a computer to handle the UPS software that calculates the charges, insurance, and also consider that everytime the UPS guy stops in for a pick up or deliver he spends an extra 5 minutes chit chatting with my employees about politics or sports.
In addition you need to pay for a box, tape, a tape gun, labels, someone to key in your address, and someone to figure out how to charge you for the billing,and someone to actually bill you the right amount, and a cushion to cover the credit card or paypal fees, cushioning material, a table, lighting, heating, air conditioning, as nobody gives you this for free.
For a company, it probably is not to much to ask that if a customer wishes to have it shipped out, that they pay the full costs of the service. You cannot say just make up for it in the markup of the product. In a modern company, every service must stand as its' own profit center.
No free lunch here guys.