With a still shaky economy, gas prices soaring, shipping carrier increases, fuel surcharges and sales growth that trails the growth of ecommerce and competitor Amazon, eBay has picked an interesting time to implement fee changes that will potentially amount to an overall increase for millions of sellers.
And while some early media reports proclaimed a fee decrease, industry insiders that understand how the numbers work provide a clearly more accurate picture.
At the root of the potential fee increase is eBay’s decision to charge Final Value Fees on the total amount of the sale, which includes charges to the customer for shipping.
Yes, eBay is now charging fees on what is categorized by your bookkeeper as a business expense. (The IRS doesn’t tax businesses on expenses.)
You can read the full announcement here. At the core of the issue is this:
Sellers subscribed to a Store: To reward free and low-cost shipping, Final value Fee rates will be reduced and applied to the total amount of sale—including shipping—starting July 6.
Here’s how it breaks out:
eBay starts by reducing Final Value Fee rates. Sounds good right?
For example, currently if you are a store owner and sell a lamp for $25 and it costs you $25 to ship the lamp, you pay 12% of the final sale price.
12% of $25 =$3.00
In July that fee drops to 11%.
But here’s the hitch. The fee now applies to your item price plus shipping costs.
Under the new rate, which takes effect in July, you’ll be charged 11% on the item price $25 + shipping $25 = $50. Your new fees? $5.50 A fee increase of 83%.
Now let’s say all along that you’ve been charging $50 for that lamp and offering FREE shipping. In this scenario, you’d see a fee decrease of .50 ₵
But here’s the “X” factor in all this. If the marketplace is used to seeing this lamp priced at $25 + $25 shipping.
It is highly unlikely that you or anyone in your category has been selling that same lamp at $50 + free shipping.
In the case of these gorgeous, heavy, one-of-kind lamps, the seller must take extreme care to make sure these make it to the buyer in one piece.
Granted, with a lighter weight item, you will not see this variance.
If a seller has been selling a lightweight bracelet for $21 + Free Shipping, they are already paying a Final Value Fee on the total order price.
Sellers who have been incorporating their shipping into their product price and offering Free Shipping will generally see a fee decrease with the lowered Final Value Fees.
However, in the above scenario a seller has determined that they can afford to incorporate Free Shipping and add the cost into the price of the product because it works for their business model.
Under the new policies, sellers have no choice. Whether it works for your model or not, you’ll be paying FVF on the total amount of sale.
Additionally if you’re a Top Rated Seller, the 20% TRS discount is no longer worth quite as much. Even though fees are being charged on the total amount of sale, TRS discounts only apply to the price of the item.
The rules change for non-store subscribers and auction format listings… more about that in my next post.
The Bottom Line for Your Business
The bottom line is that this is not a fee decrease across the board. In fact it’s not even a fee decrease on a per seller basis.
Every seller can potentially see fees go up on some of the products they sell and down on other products. It all depends on the product and how you list it.
So it’s very important to take some time and look at your most common pricing/shipping scenarios. You won’t be able to look at every product, but if you start with your most popular items, it’s a start.
Revisit your product line, your pricing strategies and your fees as you continue to list this month. A daunting prospect for already busy sellers.
You may be wonder why eBay would make such a change? Especially during a time when margins are more squeezed than ever, especially for small sellers.
eBay has stated that “buyers have told us they love free shipping”. Of course they do! Buyers would love free products too if it were an option.
But free shipping was never meant to be the norm. It was meant to be used for special promotions.If you give your kid a birthday cake every single day of the year, it ceases to be special. It becomes ordinary. Expected. The same holds true for free shipping.
… In fact there is no such thing as free shipping. There is a hard cost to shipping. And either the merchant or the buyer pays that cost. (Last I heard FedEx wasn’t shipping products for free.)
So, should you keep your business on eBay? Only if it can be profitable there.
And as with any business, the purpose is to turn a profit. If the model is no longer profitable, reassessing and reinventing your business is the only way to continue to thrive.
-Lisa
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Hi,
That and some of the other changes have me evaluating as to whether I will continue on ebay. Here’s a scenario that the brain trust at ebay may not have thought about. Spread it around. I will keep the math simple. You sell an item for $15 on ebay and are collecting $5 for shipping. Under the new policy they are collecting a FVF on what they regard as a $20 sale. Let’s say the customer buys 4 $15 items and you combine shipping and only charge $5 for shipping. You have made a $65 sale and ebay is collecting a FVF on $80. Does that sound right?
Share this with everyone you know on ebay
Larry larry(Quote)
eBay has been gradually becoming less of a viable marketplace for me, as a seller. Consistently, eBay has been implementing seller-unfriendly policies – and therefore has put me in the position to actively explore other outlets for selling. They’ve consistently raised fees, disallowed the ability of a Seller to leave bad feedback for a buyer for doesnt pay for or acts “inappropriately” , and now has moved to include shipping as part of the final value fee. It is o wonder they loamy market share – every move they make is seller unfriendly – and attribution rates are getting larger and larger. Bay’s only advantage is the ability t reach a large amount of customers – but – in all honesty, I’ve done better reducing my price by the amount of bays fees, and selling on craigslist face to face. I’m not making anymore money, but I don’t have to deal with eBays “stacked deck” with their “resolution process”, the paypal cabal, and ever increasing cost to do business. (I’ve been a member since 1998 – each year have become more dissatisfied as a seller – not good for a company who wants to expand their seller base)
Sure,, buyers like free shipping, and cheap shipping, but, as a seller who charges EXACT shipping, it’s not like I’m making a profit on that end anyway. So, in order to come out even, I’ll be forced to raise shipping to cover to extra fee imposed by eBay (if I use continue to use the service at all.). Overall, I think this is going to backfire and create the exact opposite result they intend (but eBays seems to be listening to the wrong side…). I sold my stock years ago, and just wish someone could establish a better forum for similar commerce… Justin lewis(Quote)
Hey thanks for breaking down the intended confusion eBay institutionlizes. Great article. Does anyone get the feeling this isnt really about customers desire and more about competing with Amazon’s free shipping promotions? Mike(Quote)
I think ebay bows to the buyers……….but should remember, without sellers, there will be no buyers…… Kathleen McClain(Quote)
What is the Law allowing ebay to take a percentage for a service they do not provide? When you go to an auction like RM or Barret-jackson, the seller and buyer are paying an adittional percentage of the hammer price (or “final value fee” in ebay terms) and it is up the the buyer to get that car home. He can drive it, tow it, or have it delivered….all at a cost to the BUYER. Ebay is a venue for auctioning or selling items. Unless they are paying for or physically packaging and shipping my items, they should have no rights to anything with shipping, fees or otherwise. It sounds borderline illegal what eBay is doing, but I know someone out there know more than me on the subject. Nick(Quote)
Hi Nick,
I agree (and I had the same questions myself) but I am sure eBay did their due diligence from a legal standpoint. (At least you’d think they would.)
-Lisa Lisa Suttora(Quote)
Possible UPDATE on April 19th. Just got off the phone with a guy at Paypal and he said that eBay is actually working on trying to work out some sort of compromise before actually implementing the new fees on April 19th. He said eBay actually realizes there is a huge wreck with the eBay sellers over this and many are jumping ship. The Paypal guy didn’t know exactly what is up……just that there is lots of talk going around there that there is going to be something different coming out than announced most likely… We may have some light at the end of the tunnel after all! Keep your fingers crossed.
PS I’ve been wondering if anyone contacted the Post Master General to see if it was actually legal for eBay to charge a fee on federal postage anyway (when items are shipped USPS at least). Wouldn’t eBay have to have gotten approval for that? Doesn’t smell legal to me anyway. Lori(Quote)
Hey Lori,
Thanks for the heads up! I sure hope so! I just wrapped up a trip to eBay on Location (presenting on the topic of product sourcing) and I didn’t hear any rumblings about this. But you never know. It would be great to see this reversed. We’ll know soon.
-Lisa Lisa Suttora(Quote)
Have you heard if there is any chance that ebay will remove this extra shipping fee. I am not going to list anything else until this fee is removed. I was told that there is an email that is collecting complaints about this fee. The people on the help line at ebay told me to email: sneakpeek@ebay.com. Ebay told me to tell all my friends to send complaints too. I sent my note this past weekend. Here is what I wrote: I do not think this is fair at all. You already receive 9% for the sale of my items. Many times I accept offers for very low dollar amounts – and barely break even. But, then Ebay takes 9% and I actually lose money. Now, on top of all that you are seriously taking 9% of the shipping cost. This is not fair at all. I am doing all the work, advertising, packaging, testing, dealing with any issues – and you are collecting a fee for hosting the site. If you do not discontinue your additional fee on shipping – I will no longer sell with you. I have numerous friends that also sell on Ebay. We are all ready to jump ship. Let me know if you are having a change of heart. jackie(Quote)
I am only an occasional seller on Ebay but I agree completely with those who believe that charging any seller a percentage of the cost of shipping, is at the least unethical and quite possibly illegal.
If an item sells for $18 and it cost $20 to ship it, the seller now pays fees on the full $28. I understand how this could easily increase Ebay’s “cut” on the transaction by 70 or 80%, but at the sole expense of the seller. If someone pays the post office $20 to ship an item, is it fair, ethical or more importantly is it legal for Ebay to charge a postal patron a fee on that transaction?
Why not take a cue from the Federal Government and charge sellers who smoke or drink alcohol, unimaginable fees? They could call them “sinful seller rates”. Jon Brookmyer(Quote)
glad ebay permanently (for reasons of following their policies) suspended my account a few months ago! was apalled but not shocked when I happened across this new fee fleecing deal… maybe ebay has roots in the oil industry. I make more cash by using other sites than I ever did while selling the ebay way. we have all heard it before; maybe this will be the move that brings ebay to their knees! Free shipping isn’t FREE.. it inflates costs to the end person, the buyer, increasing the sanctioning body’s profit. ebay has decided they might as well suck profit from where ever they can get it… the best way to fix this; hopefully the sellers just quit using the site… ebay really has no clue, swiping more fees in the name of lower-cost shipping; hum’ seller pays more on an already gouged to the minimum profit margin. seller either has to raise prices (opps, ebay rakes in more fees) or quit selling, all while ebay makes rosey-colored statements that raising fees rewards sellers with lower costs (Ebay really thinks that sellers are just that dumb) just to cover-up their intensions… if the site went dry, you’d bet they’d fix it in a hurry!!! I can barely recall when ebay used to be a fun site, and everyone made money! surfman(Quote)
hi guys, i cant believe the biz model at ebay – its soooo bad its a comedy..and donahoe – el leader is brain dead…
forget about it..first they get you coming and going on ebay and then paypal the only way to pay is owned by them..breaking antitrust laws…and in the MIDDLE OF A DEPRESSION they keep mucking with sellers..and adding MORE RULES AND REGS than the german army and then….this…again illegal postal fee….what do i do for INTERNATIONAL SHIPPING???
im now on bonanza BUT I SELL DRESSES…and they are very NICE BUT NO TRAFFIC…ebay sales have fallen off a cliff the last 3 yrs despite 80% discounts — DOES ANYONE HAVE OTHER OPTIONS TO EBAY? FOR CLOTHING? designer clothing? thanks!!! deb(Quote)
I just received Ebay’s most recent flyer in my mail box regarding the new fee structure to go into effect July 6th. It’s really pathetic how they try to spin it with a heading of: “New Lower Rates – reward free and low-cost shipping” and posting a picture of an attractive looking woman holding a package with a big fake smile. Yeah right…….smile for the camera lady and everything will be alright…….please insult my intelligence. Sellers are forced to swallow yet another manipulative ebay prescribed pill. Let’s cut through all the crap and get to the bottom line. For a couple years ebay has been on some quest to push “supposed” free shipping. I could see right through these orchestrated manipulative tactics from the very start, and avoided them like the plague. I’ve been selling hand percussion instruments on ebay for 8 years now. As an example, I sell a medium size blemished discount hand drum on ebay for roughly $55 and charge $15 to ship it. Normally, Ebay would charge a final value fee on the $55 sold item, and would leave the $15 shipping alone. Many of my competitors on ebay will sell a similar sized product for…….yep you guessed it……..$70 and at the same time state “Free Shipping” which equates to nothing other than a total lie. It’s obvious to even a complete idiot (or so it would seem) that these sellers are padding in their shipping costs on their product costs, therefore basically LYING to their buyers. Ebay is completely aware this is happening, and offers incentives to sellers who offer supposed “free Shipping, because final value fees on $70 add up to more profits margins for ebay than final value fees on $55. Multiply this by the millions of items sold on ebay, and one can easily begin to see the millions of dollars in increased ebay profit margins. It’s my feeling that it’s unethical for ebay to operate on this type of misleading dishonest platform. Ebay will wash their hands of it by stating they have no control over whether a seller pads in shipping on the product costs, but they undeniably know that it’s happening. In my marketing strategy I would always point out to my buyers to be AWARE of sellers padding in their shipping costs on product cost and falsely sating “Free Shipping.” I would further point out how the buyer cannot take advantage of combined shipping discounts when multiple items are purchased from the same buyer who claims supposed “Free Shipping” because how can you discount what is already supposedly “Free”? This marketing strategy worked really well for me, because buyers would buy multiple items and save big money on combined shipping discounts. Many other sellers could see right through ebay’s orchestrated manipulative tactics too, and refused to sign of for ebay’s misleading “Free Shipping” campaign. As a result, ebay is now forcing sellers into a corner with the new ebay fee structure. If I choose not to be backed into a corner on this unethical ebay fee issue , and I continue to charge shipping, the following hypothetical could become reality. Let’s say for example a customer buys four hand drums at $55 each. Adding up individual shipping at $15 per drum equates to $60 shipping for all four drums. It doesn’t cost $60 to ship all four of these drums as one package in one bigger box, but perhaps a total of $30. Therefore I would give the customer a $30 discount on shipping. The customer pays $220 for four drums at $55 each, plus $30 shipping for a total of $250. Ebay would charge final value fees on $225. However with the new ebay fee policy, I’ll be paying final value fees on $280, while only actually collecting $250 from my customer. Ebay is going to nail me on final value fees on the $30 that I gave back to my customer in the form of combined shipping discounts??? I as a seller I can’t absorb that financial loss, therefore I guess I’m forced to pad in my shipping cost on my product costs and flat out LIE to my customers by calling it “Free Shipping” to avoid being raped on ebay fees. Either route I choose, whether continue charging shipping, or pad in shipping on product cost and call it “Free Shipping” I’m still going to get nailed on more ebay final value fees. It basically comes down to choosing which way I’m going to get screwed less. Let’s get real about this……..when my profit margin on one of these hand drums is about $10 after getting nailed on ebay and paypal fees, how can I possibly offer “Free Shipping” when the $15 I charge for shipping barely covers the actual shipping cost and packaging material costs? I’d be at a loss, and without profit, I can’t stay in business. Ebay is forcing me to be dishonest with my buyers by padding in my shipping costs on the product cost, and calling it “Free Shipping.” Meanwhile my customer will be paying $280 for four hand drums with supposed “Free Shipping.” The customer is being completely duped. Ebay tries to sell this in such a way that they are trying to improve the ebay buying experience. How is that possible, when in reality the consumer will be paying more for products in the long run when this new fee schedule goes into effect? At the end of the day, this isn’t about doing right by the buyer, and most certainly has never been about doing anything right about the seller, but rather a way to increase ebay’s profit margins. Ebay is a manipulative farce and buyers need to be aware of how this new fee policy on sellers will negatively impact the buyer in the end. Ebay needs to be fully exposed on this in the mainstream media to wake up the populous. Gregg(Quote)
Basically I am going to have to raise my fees in order to stay afloat and stand a good chance on loosing my dedicated customers…. thanks ebay. If there ever was a good time to create a similar competitive online marketplace, its now and I for one would jump ship. Ryan(Quote)
So whats actually happening here people is that ebay is in essence charging us for shipping TWICE. Think about it………..Ebay charges listing fees, Final Value Fees, & Shipping Final Value Fees BUT WAIT THERES MORE!!!! Since EBAY owns Paypal they get to also charge us a second time for the Final Listing Fee and Shipping Fee through Paypal which might I add is forced upon the seller to use! What a crock…………This is getting worse and worse and only we as Sellers can change it by complaining daily and possibly withhold selling for a time. James Bett Jr(Quote)
I just had a conversation with ebay and was told it will discourage sellers from over charging on shipping. Hell, I am a small seller and most of the time don’t charge for shipping materials etc. How ever ebay explains it this is for ebay and ebay alone. If you charge the exact shipping cost you are losing 9%. Where else can a small seller sell on the internet?
Dennis Dennis Johnson(Quote)
Hi I just wanted to add after reading the comments that it is robbery what eBay is doing. How can they charge sellers for shipping if they don’t provide the supplies and the services. It makes no sense, it’s like going out to a restaurant and being charge a fee for the chef who cook your food, the waitress who brings your food, the cashier who gives you your bill. You the seller like the restaurant (eBay) and deal with it. When you checkout you also have to tip the waitress (PayPal) 10% of the total bill. Now when you go to the restaurant sometimes you use the bathroom, imagine being charge to use the bathroom? Or buying a car and the dealer tells you he will charger you every time you put gas in it or charge you a percentage for every mileage used. The point is it makes no sense. Am currently selling on eBay and they have already charge me for FVF on shipping as of April 19, 2011, its weird because other auctions that was sold only got charge regular FVF. That’s what led me to this forum, just trying to figure out how the FVF shipping fees work. babygirl99(Quote)
For non-store owners, FVF fees are now being charged on shipping on auction-format listings as of April 19th.
All listings for all sellers will be charged an FVF on shipping beginning July 6th, 2011.
-Lisa Lisa Suttora(Quote)
This is a bunch of bs. I just looked into my seller account and saw that they charge me a separate fee, shipping value fee, for an item I sold. I was like WTF!!!!!!!!! I sold a diecast truck for $41.36. The final value fee was $3.72. I only charge $10.99 for shipping. It ended up $10.68 to ship it. You might think I over charged. But no!!!! I’m not a regular seller so I had no box to ship it so I had to buy that, tape and shipping peanuts. Which I ended up paying some $5 out of my pocket. And then they charge me .95 on the final value on shipping.
So let’s do the math
$41.36
-$3.72 fvf
-$0.95 fvf on shipping
-$2.32 paypal fees
So after all the fees I really sold the truck for $34.37 without counting the shipping supplies. that truck originally cost me $60.00 brand new.
I just can’t imagine being a full time seller with all that crap eBay is pulling. When will it end? Carlos A.(Quote)
Sneaky eBay did it again! I have an eBay Store, and sell plants and a few gardening supplies. Sadly, if I made $200 a month in sale, I would be very lucky. I have another business that doesn’t need eBay. It brings more decent money, and I’m wondering if I should close my plant business for good. Could anyone recommend better auction/selling sites for micro businesses like mine? My plant inspector from the Dept. of Agriculture once told me about Etsy.com. Has anyone used it? Plant Lover(Quote)
Can’t believe the eBay policy of charging a fee on the shipping and handling. Their explanation “we are making it fair for all sellers” is a bunch of B.S. This is the latest eBay trick to increase their profits at the expense of the buyers and sellers. This new policy is going to raise the prices to buyers and make eBay a “boat load” of money! As I said in a previous post, I am raising all my shipping and handling fees by 12%. I have added a note to all my listing stating the reason for the increase in shipping and handling charges. I hope buyers understand eBay is driving up the shipping and handling costs…….not the SELLERS! eBay’s net on sales (excluding what they make at Paypal) is now over 20%! As my Daddy always said “a little for the needy and none for the greedy”! Am done screwing around with (and getting screwed by) eBay. Moving my products to eBid. Can’t beat their rates………just need to start getting some traffic on the eBid site. More eBay sellers need to take a look at this site. Fees are reasonable! Don Miller(Quote)
I’m sorry to say I am actively looking for another avenue to sell my items. I can’t afford this plain and simple. I want to point something out that happened a few years ago when Auctiva tried to rape thier customers. Thier service was free. Well they said they needed to charge or close. Ok I don’t mind paying for a service I use. Well it wasn’t just a flat rate. They were going to charge an outrageous flat rate and then on top of that charge a final value fee on what was sold. It would have amounted to hundreds of dollars. You know what happened. Everyone closed auctiva and left and within 1 week of this taking effect we all got emails apologizing! It is now a flat 9.95 to use Auctiva to list and they don’t get a final value fee on what we sell on ebay. They only get more if you use more than 1 GB space for your pictures. It’s unlimited otherwise. I didn’t go back for a long time because I already paid for another service but in the end went back.
My point is you can’t bluff ebay. People have to leave for them to open thier eyes. If enough people leave they will have no choice but to change the way they do business. People won’t do that they feel stuck like I feel stuck but the way I look at it, now even stuck doesn’t work. If you don’t make money on ebay you have to leave. Ebay may have just jumped the shark. If I leave and set up with someone else….if the change thier mind it would have to be a real sweet deal before I go back.
If ebay was making the money they wanted they wouldn’t be raising fees. I think due to raising prices on gas and on listing fees people are paying way more for items on ebay and don’t buy as much as they used to. So ebay has to find a way to get that same money they did before. If they would lower fees, people can lower thier prices and people will buy more from ebay. Ebay would make more money. Ebay isn’t just cutting the seller’s throats they are cutting the customers by sellers having to put this cost into thier products. They also will be losing the small time person that finds the unique items that are antiques or collectables because they can’t pay 60 for an item and sell it for a 10 dollar profit. Ebay will eat that 10 dollars. Now you have to put the cost way up and when you do that it isn’t going to sell unless the person has a good amount of money and doesn’t care what they pay. Rich people don’t shop on ebay for the most part! Susan(Quote)
I really think the Fee on shipping is to curb the Excessive SH fee evasion that was on Ebay Example a NEW iPod that sold on Ebay for $.99 but had $100 Shipping. A buyer would purchase that and not think twice because the TOTAL price was the norm. eBay LOST revenue on the FVF because they did not charge on the SH. Many sellers knew this and “inverted” their prices Low item price high SH. Many buyers did not complain either because they were paying “fair market price”
While I don’t condone what eBay is doing know I do “understand” to a minute extent…
What they should have done and I think ALL sellers would have accepted was make a make ALL SELLERS use the ebay shipping calcualator or offer Free Shipping. None of the “NO NAME” shipping options Mark(Quote)
To prevent these fraudulent shipping charges that sellers are using – I think ebay should charge 20% of shipping costs that exceed $30. If something costs more than $30 to ship – then the seller should pad the cost of the item. Or something like this. Thoughts? jackie(Quote)
I just saw this guide on eBay about Fees and thought WOW, eBay gets away with the horse and carriage!
http://reviews.ebay.com/Understanding-eBay-Motors-Fees_W0QQugidZ10000000021711215 Nathaniel(Quote)
Woody(Quote)
I am ready to jump ship, I need another place to sell. Where else can I sell in an auction type format? Somewhere someone has to give ebay competition…..Please someone tell me where I can sell……….I have had enough of the fees………… Woody(Quote)
Hi Woody,
For auction format listings, eBay is still the best option with the most traffic. But there are other sites like Bonanza, eBid, eCrater, Atomic Mall etc that do have growing traffic. Take a look at this survey on marketplaces put together by AuctionBytes.com – I think you’ll find it helpful in testing new venues:
http://www.auctionbytes.com/cab/abu/y211/m01/abu0279/s02
-Lisa Lisa Suttora(Quote)
Wow thanks for that site Lisa….great look at all the sites… Susan(Quote)
Could the legal insights about this imposed shipping issue be explored to bring a class action lawsuit. What would it take to push for one? Rigoberto Casillas(Quote)
I don’t know what it takes to bring a class action lawsuit, but Ebay is really pushing the envelope. They emailed me to let me know that my selling was below Ebay Standards (ha!) because of my shipping charges & I’m not over charging, they just want me to do free shipping, which I can’t do. They threatened to limit my selling & hold back money I have in Paypal. If that isn’t illegal, I don’t know what is. I will probably leave Ebay eventually like the others. Marge Sena(Quote)
I would imagine that EBay is trying discourage sellers from the scenario where a $100 item is sold for $5 with a $95 shipping charge, in an attempt by the seller to avoid final value fees. EBay looks out for Ebay only and framing this whole as though EBay is trying to help either buyers or sellers is ridiculous. The only reason they make any process change is so that they can make more money. Ed(Quote)
I have been a member since 5/99 and there have been many changes 2 ebay …. And now there need 2 get greedy by chargeing 4 shipping .. Here’s the real Joke !! Pay=pal which is owned by e=crooks also get the final fee which already includes the shipping cost !! So now u get fee’s takeing out 2 time .. thats what they call ky without a Kiss Michael ferrante(Quote)
is it possible to have a NATIONAL “DON’T LIST A THING WEEK” against Ebay? Ken(Quote)
In answer to the lame thought that eBay is loosing final value fees to shipping charges, a product was recently sold overseas. The actual shipping charges were double the cost of the item sold. The amounts were in the hundreds of dollars. If the premium they now charge on shipping had been deducted, nothing of value would remain from the sale. For all intensive purposes, their new policy eliminates overseas sales, unless a hefty and complicated handling charge is calculated and forwarded to the customer before settlement.
eBay has apparently redefined “Free Shipping” to mean eBay collects the amount charged the customer for shipping, and the seller pays shipping charges out of the sale of the product.
If eBay sales are to continue, a fixed handling charge based on the estimated auction sale and shipping premium needs to be added to the product offering. Special surcharges will be needed for overseas buyers. Buyers should be delighted! Bill(Quote)
If you raise your shipping prices you can get kicked off for low dsr’s (seller rating stars)!!! BE CAREFUL!! If buyers think your cost of shipping is too high you can get permanently kicked off of Ebay!!!
THIS IS NO JOKE.. IT HAPPENED TO ME!!! Former Ebay User(Quote)
It’s time for a new site to emerge. Ebay is great because of exposure to customers and and it was fairly easy to use. I was selling 100s of items a week, now I am seeking other sites because of the fee structure changes–eBay has neglected the entire reasons they are in business–the customer. This is what happens when your company must answer to share holders–somehow in a rough economy generate the same revenue.. Exactly what eBay is trying to do with the fee structure changes. It may work for awhile, but eventually customers will catch on and gradually move elsewhere. If any venture capitalists are out there–now is the time to create a company that will overtake eBay. They should be looking to consolidate listings of the same item(searches needed to exclude constant “junk” to find relative items) and look for incentives to get buyers to list more items.. Charging fees on shipping is not going to accomplish that; especially for the key sellers that generate significant revenue for eBay.
Anyone know of any up-and-coming sites that will knock eBay off the block?
I’ve seen a few gaining traction, but nothing as comprehensive or diverse as eBay. JDM(Quote)
Hello,
eBay has created a system that is no longer a true auction site where buyers can buy things at reduced prices. I noticed with all of the new seller fees going on – the sellers must raise their pricing. I generally buy my items from amazon.com because they tend to have lower pricing for the same products. I rarely find any good deals on eBay anymore. As a seller, I understand that when being charged 12% for final fees that you have to increase your minimum price you are willing to sell for.
Elliot Elliot(Quote)
Regarding: EVILBAY’S Final Value Fee On Shipping
I had no idea this was even going on, since I haven’t used EVILBAY since around this time last year. Anyway, some of my 22 EVILBAY ended yesterday and the rest today …and I just happened to check my account summary page on EVILBAY…lo and behold…There it was! Final Value Fee On Shipping!!!… so naturally, I called EVILBAY’s customer service to get an explanation of this…after being shuffled around to 5 different “Customer Service Reps” (I use the term loosely), they basically told me that “Per management, we are instituting this FVF on Shipping policy to benefit our buyers, due to numerous complaints about high shipping charges by sellers. Sellers will benefit too, by offering free shipping to our buyers! It’s a WIN-WIN situation!” (that’s nearly an exact quote!) GREEDY, GREEDY, GREEDY, GREEDY, GREEDY!
UNBELIEVABLE!
OUTRAGEOUS!
UNCONSCIONABLE!
UNCALLED FOR!
FONZI JUMPED THE SHARK!
INDIANA JONES NUKED THE FRIDGE!
NOW…it’s time for all of us to jump this silly PIRATE SHIP that is EVILBAY & PayFoe (oops…sorry, meant to say PayPal) …not really. Alexis Dyer(Quote)
I just received the surprise to today when I I looked at my ebay account and found a extra dollar charged as a FVF on shipping. I never got notice of this and if I had I would have raised my price $1. Anyway I’ll make three quick points
1. RETURNS: this push for “free shipping” has implications for returns. My understanding is that only the purchase price is refunded on a return and not the fees on shipping. But if shipping is free then a customer can demand a full refund for the entire amount and I’d be out the shipping because it was “free”. That means that the entire risk of the sale is placed on the seller, even if the buyer is a crook. Personally I refuse to do free shipping because I sell good product and I refuse to be stuck in the eye for shipping. have you ever gotten the one where you sell a car part, the buyer takes it, installs it and returns his old greasy part claiming you screwed him over and Ebay/Paypal returns the money. There are seller horror stories out there.
2. PASS IT ALONG: I always charge a reasonable shipping fee and never inflated the costs because I didn’t want to abuse the ebay fee structure. I wanted to be honest about it. But now, since ebay is sticking me in the eye with this I am going to inflate my shipping from now on because I am paying the same fee regardless. Ebay s getting its money so why not shelter myself from frivolous returns. Then this way If I want be a nice guy and to return part of the shipping fee, it will be at my discretion not ebays. If the customer is a problem customer, the I’ll just keep it. My point is there is no incentive to offer free shipping other that Ebay’s pat on the back (which they give you right after they lift your wallet)
3. LAST STRAW or SCREW: If Ebay ever pushes free shipping on every sale, that will be the last straw for me because Ebay is already too pro-buyer. James(Quote)
I had a buyer claim they didn’t receive an item I sent. EBay refunded their money then took it from my PayPal account without my permission causing my account to overdraft. Santana(Quote)
This is very frustrating for me. It’s bad enough that sellers can’t leave negative feedback for bad buyers. Here we find Ebay lying to all of us, saying we’re getting lower rates when anyone with a brain can figure out that our rates are being hiked up AGAIN. Unfortunately for me, Ebay is a good source of revenue and my website doesn’t bring in near what my ebay store does.
I sell live corals for saltwater aquariums, they have to be shipped overnight there is no other option. So I’m going to get charged extra FVF on $35 – 40 standard shipping fees. It’s such crap! I’m a top rated powerseller, but we still get next to no perks and no respect from Ebay. I just wish there was another auction site I could switch to, but all of the other sites are so small.
I think the one thing that all of us can do is spread the word to our customers because Ebay’s fee increase will effect them in the long run as all of us have to raise our prices, to make up for the loss of profit. At least Ebay fees are tax deductible if nothing else.
Morgan Mok
Please check out my website so I can leave ebay.
Reefgardener.net Morgan Mok(Quote)
Last year I sold over $90,000 of items on Ebay with a 20 – 30% profit margin. I sell heavy weight items and sell here in the states and internationally. I have been a Top Rated Seller for as long as they’ve offered the Top Seller program, but within the last three months with no changes in my selling practices, shipping time or shipping charges, I no longer hold that status which proves that our discounts are at the whim of fickle buyers that I’ve made mad by asking them to pay after 3 or more days with no contact from them. With the new fee structure, it will not be worth my time or aggravation to sell on Ebay. After eleven years of being a 100% feedback seller, I am calling it quits. Ebay, you will no longer have this seller’s final value fees or listing fees and the same with your partner in crime – Paypal. Have fun with your buyers who will have a hard time finding what they want on your site when you lose all of your sellers. Farewell, old friend. Your greediness has breached our contract! Glenda(Quote)
Hi Glenda,
Are you planning on moving your business or shutting down completely? I hope that with all you’ve invested in your business you find another platform where you can continue and flourish.
-Lisa Lisa Suttora(Quote)
Hello All, I agree with much of what is written above. The Ebay/PayPal cartel is getting to be too much. Every “announcement” email just makes me cringe as I know it will just mean more fee increases and/or the removal of any security or voice I have as a seller. I’ve been a seller on Ebay for 12 years now and sold stamps, postcards and other philatelic items. I only charge the buyer for shipping what the post office charges for postage – I never made a dime on shipping. I did what’s fair for both myself as the seller and the buyer, but Ebay’s intrusion into the process has upset the table and it’s completely unfair. Ebay has no right to the service provided by me and the USPS. I don’t think any of this has to do with Ebay want to promote “free shipping” yada, yada, yada. Ebay is going to going to get their higher fees no matter what we do as sellers. You can offer free shipping and higher starting fees or just suck it up and let Ebay take a part of the shipping fees..it makes no difference to Ebay – they’ll get their cut and the sellers and buyers lose out. Ebay will be the only winner. And what is Ebay going to do with this cash?
http://dealbook.nytimes.com/2011/03/28/ebay-to-buy-gsi-commerce-for-2-4-billion-bid/
Yea….they want to be like Amazon. If this deal is finalized, Ebay gets 5 product fulfilment centers and gets to sell products for big box stores. What does that mean for us? Eventually, we’ll be pushed aside after Ebay is done fleecing us to pay for this megapurchase. We have NO FUTURE with Ebay.
But there is hope. There are growing websites out there for us to sell out items. The more sellers move to these other website, the more buyers will follow. I sell occasionaly on Ebay still, but I let every buyer know that I now sell on Delcampe.com. Delcampe is geared to stamp, covers, postcarsds, coins, paper and smaller collectibles. They only charge 5.25% final value fee and do not touch your shipping. You can choose your payment options. Buyers and sellers and leave feedback for each other and revise it as necessary. You can promote your auction listing on site and Delcampe will even pay for a percentage of your ads if you promote your listing and website in print media. It’s many times better than Ebay and gets stonger with every person who leaves Ebay. There’s other websites too…BidStart, Etsy and others..do some research and you’ll find them. Unless you have stock in Ebay you have no voice or vote within Ebay, but we can take out business elsewhere and let your buyers know it – emails, mail, Facebook, twitter, Youtube – by any means necessary. wbattles(Quote)
Thanks for the feedback on Delcampe! I’ve spoken with quite a few people who have moved part or all of their business to Delcampe and are very happy with the site. As well as seeing increased sales. It’s definitely an option worth checking out for those who have a marketplace to merchandise match.
-Lisa Lisa Suttora(Quote)
Almost forgot! Delcampe has NO insertion fees and you can relist items as many times you wish with no fees. You can upload photos easily from your computer – up to 99 photos per items with no fees! You can also control when your item ends – example I can start an item at 10PM on a Friday night, but I can make it end at 2PM on the Saturday after next. Delcampe gives the seller much more control. wbattles(Quote)
Went to Delcampe and wasnt too impressed…lots of items been listed for years and no sale…and hardly any in my area of sales…so think I will stay with ebay and amazon for now… Susan(Quote)
Hi Susan,
Declampe is good for some categories. But for the majority of product categories, eBay & Amazon are still the biggest marketplaces with the most buyers.
The exception to this is that some sub-niche or micro-niche products do better on niche sites.
Also, no matter what your primary marketplace is, you want to at least have a presence on eBay and Amazon.
-Lisa Lisa Suttora(Quote)
eBay is essence is trying to make up for the seller who charges 1 cent on an item and then charges $100 for shipping. Check out some of the shoe auctions for this example. I sell an item for 99 cents and charge $4 shipping and eBay takes out 9% on both items. I guess they think my shipping materials and gas are free. Not to mention that I have to pay PayPal the privilege of using their site with their outrageous fees.
When will someone finally step up to eBay and slap them with an unfair business practice lawsuit? I do not mind paying my FV fees but this is ridiculous. And why on earth hasn’t someone come up with a viable solution to compete with eBay?
Maybe once they feel their bottom line fade away they will realize how bad they hurt sellers. Allen(Quote)
Hi Guys,
Imagine if you are a first-hour (well… 15 year) seller on ebay .com that lives in Holland. All my shipments are international on top of which the dutch mail system now charges 33 usd for any track&trace (because of Paypal) parcel outside of europe.
I just sold a beautiful japanese print for 365 usd. After all eBay’s and Paypal’s fees I was left with 298 usd. That’s 18.4% less. Now let’s hope that is actually arrives.
On top of that buyers can burn you alive followed by eBay repercussions on your account, and there’s nothing you can do about it. What eBay forgets is the eBay IS the sellers, it is not build ON the sellers. ( meaning that there’s no replaceent for “sellers”) A bit bore respect, care and support would be nice.
I am about to jump ship after 15 years. Arjan de Haan(Quote)
I’m looking for a new auction site. Ebay has recently notified me that I’m selling below standards because I had one person say shipping was too high and that I should offer free shipping to avoid this. They will temporarily withhold my funds in Paypal if I don’t improve on shipping. Well of course everyone thinks shipping is too high. I don’t even charge for materials! Why does every other business charge a handling fee but if I charge a teensy bit more than the actual shipping cost or free, Ebay says I’m overcharging! Forget this; I’m outta here. Now fvf for s hipping too! I’m outta there. Used to be a good place. Gail(Quote)
Lisa,
It is always good to get all of your updates. As someone who has educated sellers re: eBay for many years, are you still a proponent of eBay or do you recommend moving on? Beverly(Quote)
Hi Beverly,
I definitely do not agree with all the changes eBay has made in the past few years or the way they have implemented them.
But I always evaluate opportunity from the eyes of an entrepreneur. As long as you can still make money on eBay, then it makes sense to include it in your portfolio of marketplaces.
And eBay is still one of the largest marketplaces in the world. To grow an online business, you have to at least have a presence on eBay – even if it’s only to generate leads and get customers you wouldn’t get anywhere else. There are some consumers who only shop on eBay or Amazon – so that’s the only way you’ll get your merchandise in front of them.
The ecommerce landscape is too competitive these days to ignore the Big E and the Big A.
And of course, the bottom line is that if your products are selling on eBay and you’re making money in the process, it makes sense to sell there.
There are over 17,500 product categories/sub-categories that you can sell in on eBay – there’s money to be made.
That being said, I also recommend that business owners diversify their channel portfolio and have a presence on other sites as well.
-Lisa Lisa Suttora(Quote)
Just when I decided to give eBay another shot, they give me a reason to stay clear.
About the time eBay tweaked the system so that sellers could leave nothing but good feedback for buyers, I decided to explore eCrater, Bonanzle (now Bonanza) and Etsy. I also set up my own Volusion store.
Nice thing about the three listing sites named is that they do the search engine marketing for you, whereas with Volusion I have to do it myself.
Now I am using eBay only to sell items that cost me little to buy, little to ship, and clearance items that I am willing to sell at a loss, as a means of promoting my Volusion store. Every time I ship to a buyer on any other auction or listing site, I include a promo offer that can be redeemed at my Volusion storefront. Vicki(Quote)
Hi Vicki,
You have a good strategy in place. Using eBay for clearance items as well as a customer acquisition funnel is a wise move.
Too many people leave eBay all-together when they move to other sites. But eBay is still the 2nd largest marketplace on the Internet and all online sellers need some sort of presence there, even if it’s only for customer acquisition. Because those are customers you wouldn’t likely get anywhere else.
Driving traffic to your Volusion store will help to keep building your brand!
-Lisa Lisa Suttora(Quote)
Don’t forget that they now use paypal and paypal charges on the full amount deposited by the buyer. This is a triple whammy. I’m really getting discouraged by this. Are there people making enough noise to make ebay consider this move? I think it’s stupid. MGJR73(Quote)
I sell books on Ebay and for shipping I have always charged what shipping actually costs. I have also sold hundreds of books internationally. I guess I can’t afford to do that anymore! Many of the books I sell are priced at less than $10. An international buyer pays for flat rate priority mail shipping which is $13.95. That’s how much the flat rate envelope shipping costs! So, if I pay out a percentage on my actual costs, and they exceed the price of the item I’m selling, I’ve lost money. I’m disgusted. Teresa(Quote)
I have been a seller on eBay for several years and this latest fee increase just pushed me over the edge. I just received a survey from eBay and gave them a earfull. I suggest all you sellers out there do the same. https://survey.ebay.com/survey/ebay/eby11056?list=3&source=ms280OaFoV Deborah Smiddie(Quote)
Question that may sound stupid to some of you….I am not a BIG seller just a recreational seller who noticed that I am getting charged a fee to ship through ebay all of the sudden. Can anyone tell me if it would be better for me to ship through PayPal? Would I be able to avoid the fees this way? Thanks for sharing with a “part-timer”:) Carey(Quote)
Hi Carey,
Unfortunately, the fees apply to all eBay sellers. Whether you sell one item or 1000 items. Starting July 6th, all sellers will be charged fees on the total order amount (including shipping).
The way it works is eBay charges their Final Value Fees on the total order (item + shipping). PayPal then charges a fee on the amount deposited into your PayPal account.
The good news is that Final Value Fees have been reduced slightly. So if you have been offering Free Shipping to your customers, you’ll actually see a fee decrease.
The increase percentage also depends on what you sell. Heavy/bulky/odd-sized items as well as, low average selling price items + high shipping ($9.95 + 6.00 shipping for example) will see the highest increase in Final Value Fees.
So you’ll want to look at your costs before you price your items.
-Lisa Lisa Suttora(Quote)
No matter how you you slice the pie, ebay wins. If they charge us a percentage on shipping, they get more money. If we add the shipping fees to our produce price and offer “free” shipping, ebay still gets the same percentage because the amount of the sale (with or without shipping) will still be the same, won’t it? It seems as though it should be illegal to me. The government charges us INCOME tax but doesn’t include our BUSINESS EXPENSES in that total. If our government can’t do it…why can ebay? I have some items listed now but after these auctions, I am seriously rethinking ebay. Meanwhile, I am adding to my listings “contact me for more payment options” since ebay only allows you to “offer” Paypal which they own. At least I know that there is a little bit of what they don’t deserve that they don’t get….if that makes any sense. It makes me feel better anyway. Caryl Cole(Quote)
Ebay has become a joke for the sellers, which is also hurting the buyers, since there are not as many sellers on ebay as there used to be, and ebay has run up the price of selling on ebay so much that it is getting to be costly for the buyers to buy anthing on ebay. About a year ago I sold a Fender Stratocaster on Ebay for around $600. I took a video of myself playing the guitar, along with numerous pictures, to ensure that when the buyer recieved it, if he did not like it and wanted his money back, he could not do so, since I had put in my auction NO RETURNS ACCEPTED. The guitar was in absolutly mint perfect condition, No Scratches on it at all, looked brand New, and around 20 years old. Some idiot who likes to buy and sell vintage guitars bought it, immediatly took it all apart when he got it (this is no joke, he sent me an email stating he had taken the innards out of the guitar), sent me an email telling me he did not like the way it looked on the inside of the guitar, and wanted his money back, along with ME paying the shipping to him, and back, which would have been over $100. I of course said no, the guitar was in perfect condition, and there was absolutly nothing wrong with the guitar. He complained to Ebay, they agreed with the buyer, gave him his money back, and told him to ship the guitar back to me. The money Ebay gave the buyer was EBAYS, PAYPALS, since I did not have any money in my paypal account. They promptly told me I had to give them the money for the guitar, along with the $100 plus for shipping back and forth. I had told eBay DO NOT give him the money, there was ABSOLUTLY NOTHING WRONG WITH THE GUITAR, AND, I HAD A VIDEO OF ME PLAYING THE GUITAR TO PROVE IT!. They said, of course, no way, ebay is SIDING with the BUYER, which is what they do now ALL THE TIME, REGARDLESS IF THE BUYER IS LYING OR NOT! I took the guitar, sold in on ANOTHER Ebay ID that I had, a buyer bought it, paid for it, recieved it, and LEFT ME POSITIVE FEEDBACK ON THE GUITER, STATING THAT IT WAS AN ABSOLUTLY PERFECT GUITAR. I of course told ebay all this, that I now had 3 videos of me playing the guitar, all on youtube, with time/date stamps, to prove, the first buyer WAS LYING. Ebay still did not side with me, still has my first sellers account suspended, which had 700 plus POSITIVE FEEDBACK’s On It, with NO NEGATIVE FEEDBACKS, EXCEPT FOR THE ONE LEFT BY THE LYING BUYER OF THE GUITAR!
Moral of the story, for those selling on Ebay, the Returns Not Accepted on the Ebay Auction MEANS NOTHING TO EBAY management, they could care less about the sellers, and if an idiot buyer get’s your item, doesn’t like it, FOR ANY REASON, EBAY WILL FORCE YOU TO GIVE THE MONEY BACK, ALONG WITH SHIPPING BOTH WAYS FOR THE ITEM. I have complained to the morons in the Ebay Management NUMEROUS TIMES ABOUT THIS, and I am sorry to have to say this, but I beleive, as I have told them, numerous times, I believe that Ebay is run by a bunch of incompetant managers that do not have a clue on how to run a business, except TO RUN IT INTO THE GROUND.
I have since sold over 100 items on another ID on ebay, and purchased numerous items on Ebay, but, I am looking for a better alternative than EBAY, since the Fee’s on Ebay have gotten to be OUTRAGEOUS Matthew(Quote)
Its outrageous. Ebay’s new CEO should go back to school and take some accounting classes. Ebay/PayPal fees now amounts to 20% !!!! of total sale. Even mafia didnt charge that much. Its time to create a completely new trading place and send all that eBay crap to hell. Without sellers there will be not buyers. Think it over Ebay executive-greedy-idiots. Greed has never been good. Pasha(Quote)
DOWN WITH EBAY FEES
http://www.facebook.com/groups/234001246620638?ap=1
I WAS an ebay seller till this shipping fee went into effect. I started a Facebook page “DOWN WITH EBAYS FEES” If you are like me and have a problem with these new fees please join us we have 103 in just a few days and picking up more and more each day. Jay(Quote)
When eBAY sellers list an item on eBAY and the consumer purchases said item, which includes the shipping cost, that is called supply equals demand or the point of intersection, where supply and demand meet. eBAY in fact with this newest gimic of the [i]final value fee on shipping [/i] is creating a tariff or tax of inefficiency in the market for sellers. All of us need to stop complaining and start moving 20 plus percent of our merchandise to any new auction site or listing site we can. Etsy is one and Webstore is another. Webstore does not even have a charge. eBAY has taken away one item after another from sellers. They believe this is all about demand side economics, but we clearly know that if we all made a concerted effort to move a portion of our business to another website then this is going to financially hurt them, which is the only way to fight this monopoly. It is clear to me that eBAY is going to keep taking from us until we do something. Please consider moving a portion of your products to a new site. Sales are not even that brisk on eBAY anyway—what do you have to lose—nothing, especially a bunch of fees that make no economic sense—you are better off not matter what. eBAY does not even respect sellers. We are the blunt of every economic blow they take in this world. thejokerisebay(Quote)
Yes I just got screwed by the new ebay fees. I sell big industrial equipment. Sometimes the shipping cost more than the product because I am selling the product at huge savings to the consumer. To ship a huge machine by freight can easily cost $200, $300 or as high a $800 depending on the weight of the equipment. So I noticed just recently I sold a piece of equipment for $599 & the machine weighed 800lbs & shipped by freight on two pallets for $485. So previously my ebay final value fees for this sale would be $48 but under the new ebay fee structure the final value fee is $53 & they also charges a final value fee for the shipping of $43 making the total fees $96. That’s an increase of over 100%…. With the slow economy, slow sales, inflation & the increasing cost of fuel & higher shipping cost, eBay’s twisted logic & greed is going to put me out of business. Joe Bednar(Quote)
Ebay is becoming more and more greedy as the times go by. It’s a wonder another company hasn’t swooped in and dethroned them. DDT(Quote)
C’mon you all out there. I too am disgusted about the final value fees on the shipping. Its ridiculous. But I wish I would see more comments here at to why they are doing it. I would bet my left arm that the reason is this.
Overstock does a hell of a business and does not charge to ship at all. And when they do its only 2.95. I sell sewing machines on ebay for a living and when I sell one we charge 39.00 to ship it. Well Ebay knows that my customer can simply go to Overstock and buy a sewing machine on that site and not have to pay any shipping at all. So everytime that happens Ebay loses a deal and all their FTV fees from me. AND THAT IS WHY EBAY WANTS ALL OF US SELLERS TO GIVE FREE SHIPPING BECAUSE OVERSTOCK HAS GOT THEM BY THE ASS. And that is the main reason. I want to see some responses to this posting. Ebay sucks tom(Quote)
I agree…eBay is geared towards the buyers and NOT the sellers…I am sure this shipping FVF has to be illegal somewhere down the road of illegal taxation…with the threat of USPS cutting back, perhaps the extra should go to help them…EBay is already filthy lucrative…Mafia tactics..
whatta ya do when its your only source of income. darren(Quote)
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