Calculated shipping and fees... Wow ebay....
Summary: chicweb expressed frustration with eBay's fees structure, specifically how fees are calculated on both items and shipping, which affects profitability on lower-cost sales. clemowbooks suggested utilizing a Solutions for Small Business Card for discounts and selling items priced above $9.99. Others, like ilikehockeyjerseys, recommended exploring cost-effective shipping options like lettermail for smaller items, while still acknowledging the occasional risk of lost packages. Multiple participants discussed the pros and cons of using stamps and negotiated lower packaging costs. shino-6468 shared similar challenges with eBay from the USA perspective, while valuestore suggested focusing on profitability per sale. Throughout the exchanges, participants provided troubleshooting strategies and insights into maximizing profit margins through pricing, handling fees, and shipping methods.
Sorry, I have to vent.....
I sold an item 7.99$. Ebays fees were 3.30$.
Shipping: 8.43 (I added 0.50 of handling for shipping envelope + bubble packaging, etc). So 8.93$.
Now I know they are calculating the shipping and the taxes in their calculations... But I paid exactly what the customer paid for shipping... using Calculated Shipping. I'm being charged for this.
Why am I paying more for shipping that my customer paid for? Those fees added on the shipping is exactly that: paying more on shipping that I didn't even calculated. They KNOW the price was not manipulated... they provided the price themselve.
It would be easy to only charge fees on the only thing we can modify in the calculated shipping: handling fees (would be the 0.50$ here). That would take care of those who tries to manipulate the system... but I'm not. I'm trying to calculate everything and optimize.
Honestly... and seriously.... this is discouraging a lot for a new seller... I'm adding many items per day, bought a lot of stock to sell, just to realize that ebay will not be sustainable because of those fees alone.
It's incredible. I used ads on this item (never again). I just removed all promoted ads on all my items. That's on me, learned my lesson... but sold the item 7.99... I made 2.50 with ads added. Just... wow. (I'm not even including the cost of the item, here, which brings me in the minus).
How do you all deal with this? Any hints or tips?
aviatorsparadise
·2 years agoIt really boils down to your pricing. You need to set your prices at a rate to make money at it.
I use a formula to set my cost price... Listing price plus $30 (I ship larger items so shipping can easily be that high but sometimes less) times 1.05 (for tax). Take that number and multiply by 20% (final value plus international fee plus promoted listing rate of 5%) then add to my original cost. I then add my desired profit to that number and round up. That gives me my listing price. I then turn on offers and can decide if I want to sell it for less or have enough margin to sell for less.
rocketscollectibles
·2 years agoAt the end, it's the customer decision to pay less for shipping but taking a risk with the shipping of their collectible or paying a bit more and being sure everything is done correctly to receive it 100% protected
You're the seller it's your decision to set up shipping and create a model that is viable. If they receive their package damaged you'll have to refund in both cases. It's not buyer's responsibility. If i was you i would set up a free shipping model where you ship lettermail, then have an additional option for tracking/better packaging if you want. You for sure can ship comics safely fitting lettermail size. By using cardboard or something.
rocketscollectibles
·2 years agoShipping tracked cheap items that can go lettermail is one of the biggest mistake some sellers are doing. In my category its common to see new sellers who refuse totally to ship lettermail. They lose money because of their fear of losing money, it's very ironic. You do more by accepting to lose a package/get a false claim once in a while than paying tracking everytime. As someone else pointed, someone paying $10 + $10 shipping is ready to pay $20 for the item. You're the one throwing money on shipping. Lets ignore fees for a rough exemple and say lettermail would cost $3, is it better to do 100% of the time $10, or 95% of the time $17. It's just an easy mathematical business decision. Option 1 after 100 sales you have $1000, option 2 you accept to get false claims and lose some packages, but you have $1700. See how huge is the mistake. The decision to ship tracked should be mathematical by calculating a percentage expectation of item not received claims, not based on fear.
chicweb
OP2 years agoWell, there's more to it than just the tracking.
For sending lettermail, the dimensions doesn't fit the quality of our packaging. We send comics using Gemini boxes that are made for comics shipping. That, in itself, is more thick than the maximum for lettermail.
We prefer selling less but shipping the item carefully in respect of the comic book and the customer.
So yes, the customer will pay a bit more for shipping, but the packaging is 100% secure for the item with bubble wrap, gemini box AND a padded envelop.
For vinyls we will do the same. At the end, it's the customer decision to pay less for shipping but taking a risk with the shipping of their collectible or paying a bit more and being sure everything is done correctly to receive it 100% protected.
flipistics
·2 years agoI just sent this out using a Staples easy-fold mailer (8.5x11) that I scored and resized (it's a concert programme). This one is going to the States, but I measured it and it DOES fit lettermail and is probably equal in strength to the Gemini mailer. There are certainly other options to ship them very safely by lettermail.
Also, you seem to have a number of comics up in the $5 range. Once the cost of the Gemini mailer and full eBay fees are factored in, are you sure you aren't losing money on those with parcel shipping? By my calculations (assuming the sale is in Canada and ignoring tax) the fees are going to be about $3 (or higher if going to a more remote location). The Gemini mailer is $1. Additional packing supplies (bags, board, bubble wrap, label, etc) are probably 40 cents. That doesn't factor in any promoted listings, your bubble mailer (which probably isn't necessary) or COG.
It's just something to think about with those kind of listings.
chicweb
OP2 years agoAt first we were losing money on our first orders, because of the fact we didn't calculated the ebay fees correctly and were not using the handling fees at all.
I now use a calculator online that get all the fees, my cost, etc. Just search ebay Fees Calculator on google and select the Canada ebay site on that tool.
This allow me to pinpoint the amount I want to add as Handling fees to get around a profit margin I have chosen. You are right, it's about 1.50$ to 2$ of shipping supply with the Gemini Box, Bubble Wrap and Padded Envelop. We use the eBay padded envelop, it's the cheapest we have found, yet.
Playing with the handling fees and with the discount from eBay... we can provide a better shipping price than canada Post at the counter.
At the counter it's about.. what... 18$ for shipping domestically a package, minimum? That's the cheapest, I think ? We are under that by a few dollars with the new Expedited Lite + handling fees. So it's working great for us, that way, for the moment.
We continue playing with the handling fees and have multiple policies set, depending of the competition on some items, etc. We lower our margin profit on some items and some other are higher. It all depend on how we want to sell a specific item.
sparx_63
·2 years ago"At first we were losing money on our first orders, because of the fact we didn't calculated the ebay fees correctly and were not using the handling fees at all.
I now use a calculator online that get all the fees, my cost, etc. Just search ebay Fees Calculator on google and select the Canada ebay site on that tool.
This allow me to pinpoint the amount I want to add as Handling fees to get around a profit margin I have chosen. You are right, it's about 1.50$ to 2$ of shipping supply with the Gemini Box, Bubble Wrap and Padded Envelop. We use the eBay padded envelop, it's the cheapest we have found, yet."
Hello
Don't know if you are near a Chit Chats or not, they have superb pricing on bubble envelopes , bubble wrap, sealing tapes and thermal labels. The bubble envelopes are far cheaper thab EBAY, and they also ship 😉
Sparx
chicweb
OP2 years agoUnfortunately, no Chit Chats in my city. That would also be interesting to use for international shipping. I don't know much about them, but it would be interesting to try.
If we find cheaper than eBay bubble mailer, we sure will give it a try. It's all about cutting the cost without affecting the quality of service. 😉
ilikehockeyjerseys
·2 years agoI am a proponent of shipping items safely, but your job as a seller is to deliver the most value to your buyers. If we're talking about low-end comics in the under 50 dollar range, shipping individual items in boxes with bubble wrap does not deliver value. The additional input costs (shipping, supplies, your own time or the time of your employees) vastly exceeds any additional value that someone would get from having a $10-$50 comic shipped in a box. Keep in mind, you can always offer a premium shipping option as an alternative for the rare customer who does not want their item shipped lettermail.
Comics are very easy to ship safely via lettermail. If you bag and board a comic and use two to three cardboard stiffeners inside of an envelope or bubble mailer, there is almost no chance that it will arrive damaged. In turn, you will be able to ship a comic for $1.84 + supplies instead of $9 with Expedited Lite. That will allow you to either lower your prices by $7 or so dollars, which leads to a lot more value for your customer than overpacking the item and charging more does. Or it will allow you to maintain the same price point, offer a comparable service (a safely shipped comic), and make a significantly greater margin on each sale.
With that said, you are absolutely right that certain items like vinyl records do not qualify for lettermail. I also agree that if we're talking about higher end comics or more expensive items, people then value the additional safety of over-protecting the item and adding tracking.
I admire your goal to respect the customer, but you can still achieve that goal through shipping lower priced items lettermail while at the same time giving them greater value with the sale because your lowered input costs allow you more freedom with your Buy It Now/Best Offer price.
valuestore
·2 years agoA) Decide what you expect per sale, whether that be % or dollar amount, say to youself 'unless I make say $20 (or whatever) an item after all expenses, its not worth my time. Go look at the sold items, see what the profit was, make your adjustments to the price on active and future items. If they dont sell then consider clearance them at cost and focus on items that will or have generated that amount you want per sale. B) ITC credits and taxes, get a gst# and claim back gst paid on supplies and costs (ebay fees, purchase of goods) to sell your items.
chicweb
OP2 years agoThank you all for your answers 🙂 I think the best way is indeed trying to find the balance with the handling fees and also maybe considering using stamps on some items.
Good community, that's one good point for ebay.
chicweb
OP2 years agoI understand that using stamps would be a solution for some items. That would be for Canada only tho, because I refuse to send things overseas or in the states without tracking. Been burned many times with that in the past.
I just think it's very bad to force us to use stamps just because of those fees on top of shipping. They want us to use their label service and tracking because "it's important for customers", but they slap us on the hand when we do.
The only choice we now have is to offer cheap shipping without protection at all and the risk of having the postman treat it like regular paper mail, bind it or whatever.
I guess I will sell my low prices items elsewhere or in lots. I wanted to be full-on ebay, but that will not be possible at all in this situation. Not viable.
recped
·2 years agoThree things you can do
1 - If using Calculated shipping offer Retail rates not eBay's discounted rates
2 - The Handling Fee is there to be used, it should cover fees and packaging expenses
3 - Add an amount to the selling price to ensure your net payouts are sufficient to maintain the desired profit margin
chicweb
OP2 years agoYes, I just did some more testing here.... I could use the handling to cover some things... Especially because now ebay offers us a discount.
Let's see this situation:
One item cost me 2$ to buy (my cost). I sell it 5$. We could think that we more than double our investment, but that's not true with all those fees.
Let's say it cost me 8.66 to ship using the 200g discount. The customer pays 8.66 too.
If I don't add any handling fees at all, I make 0.61$ (13.03% + 0.30$). Yeah, we don't talk about doubling anymore.
Now, let's say I add 2$ of handling: Profit: 2.32$. That start to be interesting. Now I doubled, as expected. (Of course, I didn't take into account the real handling fees, but it's just an example here).
Since, before the discount, customers were paying a lot more for the shipping (In Canada), I think we have some room there.
Need to try and work on this to find a sweetspot.
femmefan1946
·2 years agoYou can use stamps to pay for tracked services. I sent a heavy item to a buyer in the USA on Friday with a $10 Whale and a $5 Park stamp. At the counter I bought a label to make up the rest of the postage and get a tracking number.
chicweb
OP2 years agoYou can combine the two? Postage stamps AND shipping label?
(I'm in a learning process here, hehe)
flipistics
·2 years agoDoes doing that allow you to get the SfSb discounts as well?
ricarmic
·2 years ago@flipistics "No", but sort of. We stamps on the box kinda folks* get the first level discount (ie 5%) and that's all. I've always qualified for level 4 but am stuck at 1.
Fortunately they levelled out the playing field a bit for us over the counter folks a while ago and we too get the nice cheaper tracked packet rates to the US. That change made a very positive difference for me.
*remember I'm a stamp seller, putting labels on boxes is blasphemous in my realm!!!!
clemowbooks
·2 years agoThe SfSB discount? Yes. I present my card at the counter.
But.
Since I have a lot of mint postage stamps, purchased from collectors well below face, I also have a "discount" on my cost there.
So if I need $15 counter rate for a service I get 5% off and my SfSB rate is $14.25.
If I then put $14.25 worth (face value ) in stamps on the package, which I bought at a 40% discount, my cost is now $8.55 .
There is no charge for the tracking number, because the stamps paid for the service.
reallynicestamps
·2 years agoDoes doing that allow you to get the SfSb discounts as well?
No, but I have an endless supply of mint postage stamps, which I also sell at a discount on eBay, as do other stamp dealers.
It is sometimes more convenient to use a label, but if there is room on the parcel, stamps are just a prepaid receipt for shipping, after all.
And customers tend to remember getting the shipment.
shino-6468
·2 years agoHi, USA here,
In the states we can't ship even a little snap in a letter. We have to have it package (or so I've been told by my post master) due to the item getting torn apart or jamming the machines they use. I have to use the ebay tracking, no choice. I too sell items for cheap $2.35 and by the time ebay is done with me I profit maybe $1.00-1.30. I use to charge flat rate shipping $3.80, but today I had to change everything to calculated shipping due to the higher cost of shipping here. I was losing anywhere between 20-40 cents on each item.
So I too am fed up with E-bay. If anyone knows a better site to sell on, let me know.
reallynicestamps
·2 years agoAre you using Tyvek or poly envelopes? Those are close to indestructible.
And are you dropping the shipments into the post box, where they will not be seen by (possibly misinformed) human eyes until they hit the terminal, where they get treated like this:
marnotom!
·2 years agoAs you're using eBay International Shipping to get your items out of the US, @shino-6468, your Canadian buyers are looking at around C$20 (US$15) in shipping charges. You may be fed up with eBay, but your problem seems to be more with USPS and shipping costs in general. You may be better off offering several items in one listing rather than one.
teenytrinkets
·2 years agoI personally try to keep all listings ~$13+ to ensure a $10 minimum profit. I do take a hit on some items that are less popular and I need to clear out. Lately I've found I need to promote to sell anything, but I find I sell way more that way, so I take the hit.
reallynicestamps
·2 years agoIt's probably worth searching the Boards for explanations of Cookie Jar Insurance (self-insurance).
I'm burned out on the topic.
ilikehockeyjerseys
·2 years agoSelling lower priced items on eBay only makes sense if you master economy-of-scale so that your costs and your time are both kept very low. You need to be in a situation where you are going to list high amounts of the same types of items that can all be photographed the same way, all take the same supplies, and can all be packed the same way. That way, everything from photographing, listing, and packing orders can be done in assembly line fashion.
If what you're selling was $7 and it is under 2CM in thickness, consider lettermail shipping for orders in Canada. You should be able to ship anything under 100g for $1.84 (2 P stamps), and anything under 200g for $3.19. Some people also buy discounted postage from postage dealers to get further savings.
Assuming I undertand correctly, the buyer paid about $17+ tax for the item (7.99 BIN, 8.XX calculate shipping). That means the item was worth $17 to this person. Lettermail shipping is $5 cheaper than Expedited Lite. So you could have theoretically sold the item for $17 and increase your margin by $5 by switching to lettermail.
Alternatively, you could price the item lower and increase your volume of sales because your shipping cost is $2-$3 instead of $8.
Lettermail does not have tracking, which means you are not covered by eBay if the buyer stats the item did not arrive. With that said, most people have almost no problems with this. Personally, I get 1 in every few hundred orders.
chicweb
OP2 years agoI just calculated and yes, you are right. The best would be to sell more expensive items. I guess, I will have to sell everything by lot to be able to make more money per item.
Ebay is really hurting themselve by charging fees on the shipping (especially with the Calculated shipping, since they don't have any reason to think the price of shipping is manipulated to go around the system).
I guess I don't have any choice now if I want to continue on ebay... Removing all indivual items less than 10$ and sell them by lot.
flipistics
·2 years agoThey also want people to offer free shipping, or at least not discourage people from it which is what would happen if people with the full price baked in were charged FVF on everything and not people charging for shipping. The simple matter is that not everything is appropriate for online sales, or you have to be more creative in how you sell them / lot them up etc. It's a learning process that takes a while to figure out, but it's worth it when you do (imo).
clemowbooks
·2 years agoBut I paid exactly what the customer paid for shipping...
Why?
Don't you have a Solutions for Small Business Card? That gives you a discount of 5% or more depending on the service.
Or you can buy discounted mint postage stamps here on eBay which can save you even more.
https://www.canadapost-postescanada.ca/cpc/en/business/small-business.page?
It's also been my experience that it is not worth selling anything here for less than $9.99, and preferable not less than $9.99 USD.
In addition to the usual 12.5% FVF on purchase price,shipping charge,and sales taxes, there is a 30c service fee on each payment.
Then there is your procurement cost, your wages at 27c a minute, packaging costs (as you mentioned),and optional costs like Promoted Listings, reserves on auctions, etc.
chicweb
OP2 years agoI buy the ebay shipping label and print them. We cannot add our own card there.
And if I use Canada post for shipping directly? That same item would cost the customer almost the double to ship. Ebay got that discount for 200g or less.
If I want to be competitive with all those using USPS and their cheap shipping price, I don't really have any choice.