REALITY vs PERCEPTION - Your eBay/PayPal fees as a % of sales. TOO HIGH?

[lina-mallows]

According to the rules* posted in the Sales Summary area-
I am rounding DOWN the percentages provided- so these are NOT the true numbers.

FOR US- and US alone-
THIS IS AN APROXIMATION OF WHAT THE FEES/SALES REALITY IS:
Net eBay fees, as a % of sales
for MARCH:23%
for APRIL: 19%
for MAY: 12%
Net PayPal fees, as a % of sales
for MARCH: 5%
for APRIL: 6%
for MAY:4%

WHAT IS YOUR REALITY?

Now just for fun- our repeat buyer %s over three months (also rounded down):
55% 21% 31%



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* THE RULES: "This information is provided to you for your personal information and use only. You may not sell or distribute it to any other person or entity, whether for commercial purposes or otherwise. Unauthorized use of this information will result in the termination of your use of the Sales Reports Service. eBay makes no representation that the information contained in this report reflects all current transactions. Please consult the Sales Reports Service End User License Agreement for complete terms and conditions."

[bare_bright]

ok I myself don't like the fees and who does like fees

but when you really Look at the service they provide it's

still cheap, Some banks "Canada" Charge much more per transaction When you use there debit card, Services etc.

let's face it we as sellers need paypal since it's a way of collecting funds quick and safe, it's also more and more being Trusted by the online buyers.

There debit card is just great, Strange no one has mentioned that we get back a % when we use it for gas etc.

b4 it took long for me to transfer my funds from paypal to my bank, now it's 1,2,3 pop in the card in a ATM & Withdraw, no fees there, no fees to use it for buying gas etc. like said you even get back a Bonus

Simple Solution if you don't like there fees, get them back another way, I am sure you sellers know how,

I pay alot of fees because of the low end price products.

All I can say Paypal has made my life easier 🙂

[lina-mallows]

rockyeb220- maybe I need to refocus what I am aiming for here.
So many people here complain that eBay & PayPal fees are too high.

I am not suggesting PayPal is bad, and we don't need it.
Yes- it makes life so much easier.

With respect to the fees we pay- All I see is the information that my SELLER REPORT provides- and the WORLD AVERAGES- that are available.

The individual experiences of REAL individual sellers is lost in this equation. We are in Canada- are needs, and experience is not the same as a seller in China. So, what happens in the rest of the world, may, or may not, have any relevance to our experience as an eBay seller.

If what we are paying- based on our sales, is what others here (in Canada) are paying- then we are doing things right.

If we are paying FAR MORE then others, who sell similar items- can we figure out what is wrong- and correct it- IE- LOWER our % fees?

[bare_bright]

Well are we paying FAR MORE then others?

is there a Table or Chart with the figures? on what

different areas of the World are paying, for sure Paypal

has based there fees according to many different factors.

Don't forget Paypal is a Business like any other Business and the Bottom line is to make a buck.

We should be glad there not way over charging since they could if they wanted, where else would we run to?

Wait for money orders or drafts in the mail, I had my share of that, 30% of buyers on my type of products never end up sending payment.

[lina-mallows]

rockyeb220 - I am not concerned about others in the world and what they are paying- just are we as Canadian sellers able to find a way to save some money by lowering our overall fees.
I am not complaining about eBay&PayPal's right to make money- they are a business. That's their job.

I am looking for ways to save some money, within the structures provided.
i.e.- For eBay- is UK exposure worth the price? For low ticket items this can considerably raise you costs, as a percentage of sales.
i.e. Is waiting for a person to COMBINE shipping over a number of weeks- unlike some sellers who demand almost instant payment- and therefore pay higher fees?
Should you ever return MULTIPLE payments to a buyer?
i.e. One seller buys FIVE ITEMS- and pays for them ONE AT A TIME?
Would you return the payment- and request that they send ONLY ONE?

The above examples have no concern over what happens anywhere else- but here. These are some of things that need be discussed regarding reducing your fees, as a percentage of sales.

We have some control over how much we spend for listing our items.
What features make sense (like MANY added pictures), and which don't (like FEATURED LISTING) is rarely mentioned.

[lina-mallows]

rockyeb220- to be clear- it is not what eBay & PayPal are charging.
It is our ability, as sellers, to use these services effectively in order to reduce our overall costs.

[bare_bright]

Well yes there are certain ways more so in ebay for example keeping your listing prices at certain levels to avoid jumping a bracket that the fees would increase for listing etc.

and how can one reduce the paypal fees? also it all depends on what you sell and how you sell, they also have
brackets that increase

other than that not going to break my head over a few bucks
I have all ways sold by the law of average and that works fine for me

There are alot of variables involved in every different items one sells, what is good for one may not be good for another

[lina-mallows]

rockyeb220 - "There are alot of variables involved"

I absolutely agree. There are a lot of variables.

Some sellers actually WANT you to pay for each item individually- and those are the ones that mostly DO NOT combine shipping. That is their choice. Then there are those that ONLY offer combined shipping, IF you pay for EVERYTHING together. Then there are those that don't care- and don't state preferences.

SHOULD WE BE CLEAR ABOUT MULTIPLE ITEMS PAID TOGETHER- TO GET COMBINED SHIPPING?

There are some things that are likely the same, when a seller sells more than one item to a buyer, and the buyer sends multiple payments.

A BUYER buys FIVE items for $1.88 to $3.88
AND send FIVE payments.

Do you then return the payments?
With all the DSR nonsense, exactly how far can push a customer to confirm with your expectations?

When each of the items is UNDER $3- would you return the payments- or eat the extra $1+ in fees?

These questions have not been addressed before here- or I haven't found the answer.

[bare_bright]

Well I can only speak for my self here, I offer combined Shipping at a 75% discount and if a buyer buys 5 items or more shipping is maxed out at $10.00 anywhere worldwide.

I have a page in my ebay Store Stating all the above, also
when a Buyer wins a item the information is displayed in You are the Winner email and also a Separate personal email is also sent out right after again stating the same

When a Buyer wins more than 1 item the combinded shipping rules kick in, There all setup in presences under shipping.

if a buyer wins 1 item and pays then buys another item the same day, obviously they pay the full amount for each and at times I ship the items separately or sometimes I offer a refund, Which adds to the work load, other times I just leave it they way it is since I have made the rules very clear, it's one on one bases for me.

There is one thing that I have Learned on ebay is most
Buyer's DONT READ so if you want there attention it has to be within the first line.

getting back to the question on DSR if I see someone has really way overpaid in shipping I will notify them because I don't need the headache afterwords in the Feedback about excess shipping.

going to bed lol

[pierrelebel]

"It is our ability, as sellers, to use these services effectively in order to reduce our overall costs. "

1) increase PayPal volume to at least US$3,000 month to benefit from lower rate

2) increase your average transaction size by selling more expensive items or enticing buyers to purchase more than one item per transaction. Enticements may include "free shipping" over a minimum amount.

3) if lowering expenses is the only criteria, do not offer to ship overseas. If sales volume and profit are more important, expect to pay the extra 1% PayPal cross border fee. .

[ampurtle]

High volume sellers do better than the other 99.9 % of sellers on eBay, so your experience has no bearing on the original issue. (that's not a dis, it's just factual)

As the discounts are based on DSR, a high volume seller typically ends up with a higher DSR because the average is based on a much larger data set, where as a small seller selling big ticket items gets zip for a discount if even 1 buyer gives you 1 bad DSR value.

Poor DSRs are rapidly becoming the norm as a foreign buyer gives you a positive feedback but slaps you with a zero for shipping time because US customs takes 4 weeks to get around to examining your shipment for antrax. eBay isn't promoting honest and fair DSRs to buyers because they have scrupples, it's because that's how they get out of providing FVF rebates to the largest block of sellers.

As a small niche seller on eBay I have no inducements available to me to be offered to buyers other than giving away the store.

A far better metric would be to base the FVF discount on a delta from the eBay average, which means if your DSRs are above the average of all sellers, then you are exceeding the norm and should be rewarded, but if your DSR is at or below the eBay average you get squat.

Of course that would cost eBay a lot of money so it will never happen.

[pierrelebel]

"As the discounts are based on DSR, a high volume seller typically ends up with a higher DSR "

This is a misconception. The facts prove the reverse.

Very few high volume sellers on eBay have superior DSRs (4.8 and above). Take a look at the top 500 sellers:

http://www.nortica.com/UserArea/ebay500.asp

As you can see very few qualify for the 15% FVF discount (DSRs of 4.8+) and only a handful qualify for the top 20% FVF discount (DSRs of 4.9+).

It is a lot easier for a relatively small seller to control the quality of twenty or fifty transactions a month than a larger seller with hundreds or thousands. .

[ampurtle]

Oh contraire mon capitan....

A volume of 1000 items with 20 bad DSRs produces a higher seller DSR than 50 items with 2 bad DSRs by a factor of 2 to 1... the numbers are irrefutable...

4.8 IS a superior DSR, the average is below that. Don't think in terms of fixed numbers, that's eBays scam to avoid the discounts, they don't represent the reality, look at the deltas, that tells you what is really going on.

eBay actively promotes to sellers the concept of giving truthfull and accurate DSRs, which means that for the vast majority of transactions 4 out of 5 DSR categories would be a 3 and result in very few discounts. Have a look at the overall eBay DSRs for the past 5 months, they are steadily declining as eBay convinces buyers to give average DSRs while talking out the other side of their mouth about their great FVF discounts.

You can't change the rules for giving DSRs without adjusting the methodology. Using the old concept for sellers and the new metric for buyers is at best sleezy and quite possible descriminatory. The end result is that sellers are getting screwed over and eBay is doing everything they can to make you smile while they stick it in.... in... in... The net result is more and more questionable issues are being reported by buyers because they are now imune from being rated themselves, it's like the teacher went home for the day...

You're very fortunite Pierre, you are escentially imune from all these issues because of your narrow focus niche market, which is why I am going the same route. I will never have any questionable buyer issues because it's a micro market where everyone is connected and knows everyone else either implictly or explicity.

In any case, it's not worth throwing numbers back and forth, everyone has their own unique experience and I'm getting out of this Power Seller Program just as fast as I can. I've had no problem running a business for 3 times longer than eBay has been in business and I have lots of experience of being on their side of the fence, so I know all the marketting tricks and how to recognise if something is self serving or not.

You see, I am so well known and respected in my niche market that I don't need any feed back rating and I have officially with drawn from the feed back scheme. Neither buyers or sellers in this market give a hoot about eBays lame attempt to pass judgement on people in order to better line their pockets. We all understand that a repeat order is absolute proof of buyers and sellers. Believe it or not, I regularly ship product to buyers in my niche market before being paid, that's how closely knit and honest that community is.

[pierrelebel]

Check the facts, not the theory. Facts are available and speak for themselves. .

[pierrelebel]

"you are escentially imune from all these issues because of your narrow focus niche market,"

Most of my competitors wish that were true. Their feedback is NOT 100% and their DSRs are generally well below 4.8. The "niche market" does not work for them! 😞

Theory is great. I only believe in facts that can be verified. .

[cartoonsinabox]

Sorry Pierre but I think your wrong on this one and have to say Ampurtle is right 100% .

[ampurtle]

Hmmm... the numbers are fact, you just have to keep an eye out to notice the overall declining DSRs eBay wide. It's not like eBay is going to advertise that DSRs are falling noticeably across the board.

The numbers for DSR calculation are basic math, verification doesn't enter the picture. By your own admission, 4.8 is a superior DSR and if your sales are what you stated, then please correct any miscalculation I forgot to take into consideration, baring in mind my extrapolation is approximate as I am not privy to your actual sales summary's.

My intention is not to put you down Pierre, you just happened to state real numbers for your experience. While the performance of any specific vendor in any specific market is determined by the market and their practices, that is a totally separate issue and probably warrants a wholesome discussion in another thread, but that will probably lead to an ethics debate.

Perhaps you missed my conclusion of the whole eBay experience, where I said I would be adopting your business model and stay within my small niche market. Philately (sp?) is the number one hobby in the world and less prone to the seasonality of my niche market which means I am unlikely to qualify as a power seller 12 months of the year.

I have spent 6 months experimenting with eBay business models to determine the best approach and if it's all worth it or not. As a very small niche vendor, it is borderline and ANY loss of funds tips the scales against me so I have to run a very tight ship or go down with it ;p. It's not my goal in life to invent ways to sell product on eBay that most benefit eBay.

Oddly enough, eBay was born to service people exactly like me, but now we are just baggage to be tossed around on the loading dock because eBay can't survive unless they suck vendors into taking on more than they really want to buy dangling carrots over the precipice. eBay was never intended to be a competition among sellers, the original goal was to provide a platform for all the little people to have access to the internet for selling their stuph.... but nothing is static, so here we are, full circle, back where we were before eBay was launched.

Like so many other good ideas, eBay is now a perfect example of what it was created to battle against.

So now, the issue was... are the FVF credits a flop or not... I guess that pretty much depends on what your expectations were and which side of the fence you are on. First, lets get right down to it, FVF Credits are an incentive program. Incentive programs are designed to increase sales/income, they are not there because eBay loves you.

From the program sponsor's point of view, FVF Credits are a success if they convince you to increase your sales and result in an increase in FVF, which is the sponsor's profit margin and goes right to the bottom line, while insertion fees are designed to cover the operating costs. Only the sponsor knows if a program is a success or not and they may quantify that by setting specific targets for FVF increases. If FVFs go down, it's not likely related to the incentive program but is probably entirely attributable to current economic conditions, so additional metrics need to be applied which typically would be looking at individual vendors or specific categories. One can massage the numbers to suite them, but the best metric to measure incentive programs is to look at the individual vendor's pattern.

From the sellers point of view, an incentive program is successful if it results in an increase to the vendor's bottom line. How much that increase is in real terms or percentages only quantifies how beneficial the program is. Or in other words, if you get ANY rebate, it is benefiting you. IF you have to incur higher expenses either in real or intangible terms, then it becomes a subjective determination, but if the incentive program is luring you into doing things you would have otherwise not done, then you really need to step back and do a risk/reward analysis. Incentive programs are primarily designed to benefit the sponsor, so the requirements, incentives and qualification levels have been carefully modelled against years of data to determine what those numbers should be to produce the maximum benefit to the sponsor. From a vendor's perspective, the real issue is not whether the program is successful, but rather is that program meeting the vendor's expectations. The answer quite simply is usually no, because that is not the purpose of an incentive program. It's a lot like the lottery, your expectations are high, you don't buy lottery tickets because you really want to win $10.oo, so one tends to view the experience more negatively each time those expectations are not fulfilled.

Bottom Line.... I get a 5% rebate each month, that's $2.12. If the world was just about to end and I got 15%, that's just enough to buy a medium double double and a crullers for two people. Obviously that is not enough to expend time or energy on, or to increase my risk level by chasing the 15%. But I'll gladly take the free coffee each month because being on a disability pension, a dollar is a significant amount of money.