eBay

milezero · ‎12-09-2013

10% final value fees and a "shipping final value fee"?! WTH is that? Oh, I know, it's way of pretending final value fees are lower than they actually are.

Wait, I can hear the chorus already: "other auctions charge more". Yes, and with other auctions you just drop off the goods and pick up your check. Big difference in time, trouble and aggravation.

However, you can boil a frog if you do it slowly, so the fees will keep rising until sellers drop out I guess.

I hear several large corporations around the world have entirely eliminated their middle management and surprise(!) things work just fine. Better in fact as the paper pushers are sent back to the floor to do productive tasks that produce goods or serve customers.

Time eBay discovered this concept and instead of trying to screw more out of the sellers who make this place exist, save by getting rid of useless mouths who spend their time trying to squeeze more juice out of someone else's lemon to justify their paychecks.

But of course part of the function of middle management is to provide peons for upper management to order around, so upper management has to feel the need to give up that pleasure in exchange for better profitability.

Thank you and good night.

rose-dee · ‎12-10-2013

@milezero wrote:
10% final value fees and a "shipping final value fee"?! WTH is that? Oh, I know, it's way of pretending final value fees are lower than they actually are.

You appear to have been on eBay for some years, but it sounds as if you haven't encountered FVFs on shipping before, which seems odd -- the change was made quite a long time ago. Actually, the FVF fees on shipping were originally intended as a way to stop egregious shipping charge abuses, which were rampant on eBay a few years ago. I know because as a buyer I got stuck once with a ca. $150 shipping charge - not disclosed in advance - on a $50 item. The shipping FVFs have virtually eliminated that sort of scam.

Recently, fees in general for a lot of sellers have been lowered (I know mine have), including listing fees with the new free listing allowances. Honestly I have to admit that my listing costs on this site have gone down over the past 12 to 18 months.

While as a seller I would prefer not to have to pay FVFs on shipping, there are perfectly permissible ways to get around it, or at the least to minimize what you pay. The subject has been discussed over and over on these boards, so I won't attempt to rehash what has already been said.

The way I look at it is that I am getting the benefit of world-wide exposure on someone else's website, so a roughly 9% fee for the use of that site doesn't seem horrendously high (actually I pay less than 9% because of the TRS programme). If a 9% overhead for the use of a "platform" for selling, be it a B&M store or a website, is too rich for a seller, then chances are his or her enterprise would not be profitable anywhere. No business has absolutely $0 costs, and it's always a question of balancing expenses and efficiency.

You are right that there are selling venues without middle management that involve simply dropping items off and picking up a cheque in exchange, but you still have to take your gasoline costs, wear and tear on your vehicle, and your time into account. You also can't very well be personally dropping off items all over North America (or the world) and picking up cheques from buyers. EBay effectively allows you to do that without going further than your local post box -- for a fee.

pocomocomputing · ‎12-10-2013

Not so long ago. Just over two years. Shipping FVF went into effect April 2011 for non-stores and July 2011 for stores.

rose-dee · ‎12-10-2013

@pocomocomputing wrote:
Not so long ago. Just over two years. Shipping FVF went into effect April 2011 for non-stores and July 2011 for stores.

Hi 'poco' ! I had to LOL at the above -- around here with all the mind-boggling changes recently, a month seems like a year, and a year like a decade - ancient history even! Easy to forget...

nuvistors · ‎12-10-2013

Unfortunately there will always be those who think any fee is too high.

These people could use the local want adds in the newspaper, But wait, They also charge a fee, even if the item does not sell.

With the local paper a very few people will see your add compared to many thousands with ebay.

About the only way to avoid all fees is to have a yard sale and some municipalities require fees for them.

steveyboy1969 · ‎12-11-2013

Who doesn't agree the fees are too high? But what are the other auctioning/selling options online? Nothing! There is absolutely nothing that comes close, so it is a necessary evil although it does burn my touche.

mr.elmwood · ‎12-11-2013

The fees are high but there is no alternative? That makes no sense. Every business has a COGS.

FVF on shipping came in 2 1/2 years ago. I knew about it 2 years before that. How can a seller not know, what they are supposed to know, for years on end?

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pierrelebel · ‎12-11-2013

"Who doesn't agree the fees are too high?"

I do.

Too high compared to what?

Like many sellers, in addition to selling on eBay and elsewhere online, I also consign some of my inventory to public (licensed) auctioneers. Typically, they charge consignees (sellers) 15% to 20% of the hammer price for consignments under $10,000 (rates go down as the size of the lots go up).

Other niche online sites (APS for example) charge a flat 20% and do very well for sellers.

All in all, I find eBay fees to be at the low end of the range for sites that produce successful results for sellers. And that is what really counts - not a few percentage points cheaper.

73rhc · ‎12-11-2013

I'll pay 15% any day of the week, if all I have to do is drop off my items and not worry about packing, posting, wondering if it gets there, bad feedback, low DSRs, non paying bidders, et al...

rose-dee · ‎12-11-2013

@pierrelebel wrote:

All in all, I find eBay fees to be at the low end of the range for sites that produce successful results for sellers. And that is what really counts - not a few percentage points cheaper.

I'm in complete agreement with Pierre's comments. For some of my merchandise (vintage clothing) consignment fees can be as high as 40% of gross selling price, which is even worse than Pierre's live auctions.

And what about operating a B&M store? Or worse, a store in an upscale mall, with rents that increase every year, maintenance fees, and miscellaneous fees of every kind.

No, I can't agree that fees here are too high, given the services that are available to us. And, as I mentioned above, there are "eBay-legal" ways of minimizing even those fees, for sellers who put in the effort to do so. It does, I admit, take more effort than just complaining about high fees.

73rhc · ‎12-11-2013

And you are fooling yourself if you think eBay is at 10%. Sell an item for $10 and charge $10 for actual shipping. Total $20. eBay takes $2. You're left with $18. Now bring your item to the post office and pay the $10 for shipping. Now you're left with $8 on a $10 sale. Do the math. So don't start the argument to charge more. This example is taking into consideration that one is using ebay's shipping calculator.

mr.elmwood · ‎12-11-2013

My math says I keep 76% of every dollar grossed. That is AFTER buying it, listing, selling, packing supplies, down to the PO and back.

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pierrelebel · ‎12-11-2013

"And you are fooling yourself if you think eBay is at 10%"

???

Where did I state 10%? I pay eBay much less than that!

rose-dee · ‎12-11-2013

@73rhc wrote:

And you are fooling yourself if you think eBay is at 10%. Sell an item for $10 and charge $10 for actual shipping. Total $20. eBay takes $2. You're left with $18. Now bring your item to the post office and pay the $10 for shipping. Now you're left with $8 on a $10 sale. Do the math. So don't start the argument to charge more. This example is taking into consideration that one is using ebay's shipping calculator.

With all due respect, I think your math -- and perhaps your interpretation of eBay's fee structure and fee "shelters" is off the mark.

I generally list using Fixed Price, GTC. If I sell an item for $10 and charge $10 for actual shipping, the shipping is a wash in terms of my income -- of course this doesn't take into account the fact that I use Paypal labelling, which offers discounts, some of which I pass along to my buyers, some of which I apply against my costs).

So my gross income on that sale is $10 (often more if I get a shipping discount on a parcel service). The majority of my sales are to the U.S., so I usually list with very low (or free) Canadian flat rate shipping costs, to benefit from lower FVFs. My fees are:

FVFs on $10 sold item (9% or $0.90, less 20% TRS discount) = $0.72

FVFs on shipping: 9%* (based on 1st domestic shipping and, say, $3.00 Cdn shipping cost),

= $0.27, less 20% TRS discount) = $0.22 (*Actually, I believe FVFs on shipping are lower than 9%, but I've used this as an example of worst case scenario).

Total fees: $0.94

Fee as % of gross sale: $0.94/$10.00 = 9.4% -- this will be lower (9%) if I show free Cdn shipping.

So my net after eBay fees is at worst 90.6% of gross selling price, or at the best, 92.8%.

Of course there are other expenses that will relate to the sale, too - Paypal fees, shipping supplies, computer supplies, gas to get to the P.O., etc., but we're only discussing eBay fees at the moment.

I still maintain sellers have to do their homework, put in the effort to study eBay policies and "work the system" to get the best fee deals out of eBay. If you do, it is possible to gnaw those fees down to the bone and get the utmost you can out of eBay. And I really don't think the fees are outrageous to begin with.

73rhc · ‎12-11-2013

You made the reference of live auctions being more expensive at 15% to 20%. So it was implied!!!

73rhc · ‎12-11-2013

What are your store fees? And yes Paypal fees are part of it. We were discussing auction fees, after all.

73rhc · ‎12-11-2013

Not everyone has TRS discounts or an eBay store! So your example is not the norme.

73rhc · ‎12-11-2013

"FVFs on $10 sold item (9% or $0.90, less 20% TRS discount) = $0.72
FVFs on shipping: 9%* (based on 1st domestic shipping and, say, $3.00 Cdn shipping cost),
= $0.27, less 20% TRS discount) = $0.22 (*Actually, I believe FVFs on shipping are lower than 9%, but I've used this as an example of worst case scenario).

Total fees: $0.94
Fee as % of gross sale: $0.94/$10.00 = 9.4% -- this will be lower (9%) if I show free Cdn shipping."

I used an example of $10 shipping and you're using $3. Let's compare apples with apples.

rose-dee · ‎12-11-2013

@73rhc wrote:
What are your store fees? And yes Paypal fees are part of it. We were discussing auction fees, after all.

My store fees are $14.95/month. I regularly make that up in the FVF discounts on one decent sale, and the rest of the month the benefits are all mine.

I rarely sell at auction anymore because I found overall that it costs more in listing fees and nets less in final price than selling at FP. The trend toward direct-buy shopping started a couple of years ago and I think eBay has been encouraging FP listings through its fee policy changes because it seems buyers now prefer FP.

As an eBay seller (especially a Canadian!) I believe one has to find a way to adapt and go with the flow in order to thrive. I can't say the changes I made were always comfortable, but they've worked.

rose-dee · ‎12-11-2013

@73rhc wrote:
I used an example of $10 shipping and you're using $3. Let's compare apples with apples.

This may be where you misunderstand. I'll try to elaborate: I know that roughly 90% of my sales are to the U.S. Therefore, I show a 'nominal' flat rate Canadian shipping charge on almost every item, sometimes I show free shipping to Canada.

This does two things - it reduces my FVFs on all shipping, because the FVFs are based on 1st domestic shipping. It also occasionally helps to increase my Canadian sales. So, perhaps on 1 in 20 sales, I get a Cdn buyer and I "subsidize" their shipping, which is fine by me because it's generally lower than US or overseas anyway. In the meantime, I get a drastically reduced FVF rate on shipping for every sale I make outside of Canada.

It's a simple strategy, it's "eBay-legal", and it works. It greatly reduces overall FVFs on shipping, especially if I'm shipping to the US with Expedited Parcel, where I also get the online labelling discount.

If most of your sales are to Canadians, you'll need to use a different strategy, but you can still apply this principle to offset some of your costs. Essentially it's this: move your charges and prices to the place where they'll attract the least amount of fees, and work at taking advantage of "fee reduction" programmes that eBay offers. It can be done.