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.
In my niche, dinnerware and glassware, I’ve already noticed that many wonderful products are NOT offered on Amazon. Their shipping standards don’t allow you to cover your costs for transportation, packaging and insurance for heavier, fragile items.
Looks like eBay is headed there, too, as fast as it can go.
I totally agree. After going through all the fine print today on the eBay fee changes and running the numbers on some different scenarios, what it comes down to is whether or not the product that you sell on eBay can be profitable.
And this can affect anyone. Really big sellers of course, have discounts with shipping carriers and can absorb cost on volume. But let’s say you’re a smaller, but established seller and you sell both lightweight and heavy items. When the fee changes occur, many of your items will no longer be profitable. Which means either stop selling them or keep them as loss leaders.
As to where these products that no longer fit the model go… that’s another question.
Not to mention the added constraints of only sourcing items that fit all the new profit parameters of the eBay fee model.
Thanks for the breakdown, Lisa. We’re retired and our Ebay store is just a little extra income each month. Less now. We purchase from estate sales and simply had to lower the value percentage for what we might pay per item. Previously, we only purchased items at 33% to 50% of assessed value betting we can list on Ebay and double our money. Worked great for about 2 years. However, now, with the new fee structure, we have to purchase items at around %25 -%30 of assessed value. We get less products, sell less, make less. Bummer.
There’s just one problem. Charging a fee based on any part of the shipping and handling costs is basically a shipping surcharge or fee imposed by a company that *does not do the shipping*. Shipping and handling done by the majority who are not cheaters, is usually fair and the bare minimum they can afford to charge because they want to be competitive.
The are imposing this fee as if price+shipping, lowest first doesn’t exist in their search. It does and it has since long.
eBay is not doing the shipping so it’s illegal for them to charge a fee for a service that they do not provide.
I’m with you on this. I question the legality of them being able to do this. For one thing, shipping is an expense that we pay to the carrier. It’s considered an expense line item from a tax perspective. Because eBay is splitting out the tax from the shipping costs (for sellers who charge shipping) they are charging a fee on an expense that is paid DIRECTLY to the shipping carrier.
With PayPal, the ENTIRE amount goes into PayPal so they can pull a fee on the entire amount. But I don’t see legally how eBay can do it on their side. If a seller chooses to include the shipping costs in the item price, then eBay can charge a fee on the item price. But to mandate fees on shipping charges for all sellers – I really don’t see from a legal/tax perspective how they can do this.
In the case of Amazon, it’s a different story because Amazon sellers are NOT billing the customers directly for shipping. Amazon bills the customers for shipping and CREDITS the seller for the shipping fee. Because Amazon is handling the shipping fee with the customer, they can charge a fee on the entire transaction.
The other issue with this eBay FVF on shipping is the situation of “double dipping”. eBay & PayPal are the same companies. PayPal already takes a cut of the final value price + shipping. Now eBay is doing the same. eBay also requires sellers to use PayPal (I know there are other payment options but PayPal is the preferred payment provider.)
So essentially eBay is no mandating a fee on shipping, requiring sellers to use PayPal and then taking ANOTHER cut on the back-end. And people are locked in to this if they want to sell on eBay. Smacks of a monopoly to me.
Thanks for all the info Lisa. I’ve just about had it with ebay selling. Their greed is surely going to be their demise.
I agree – this is pure corporate greed. We are not in a great economy. eBay traffic is down. Sales are down. Making things more complex and setting millions of people of for increased fees is not the thing to do now.
What needs to happen is eBay needs to drive more BUYERS to the site and make it simpler for buyers/sellers to transact business there.
But on another note – is how to help people who use eBay for an income. The reality of it is that the buyers are still there (compared to many other sites.) In your case, will you quit selling altogether or move to another venue. I see that you’re from Australia and that is one of the fastest growing eBay marketplaces.
Hello Lisa, My partner is actually the one that does the selling and i think that she is starting to think twice about continuing. She is finding that there is more and more competition and that margins are getting smaller.
I am a small store owner on ebay selling mostly books and I was unaware of these changes so thanks for letting us know. Ebay is starting to become too greedy and its once again squeezing the small players out. Time to become a big player then lol
We may be naive, but this seems to put a stronger highlight on our
assumption that one should always add something that has
low production cost as well as a high perceived value, to the offering.
It could be a PDF guide added to the product. The PDF product would be given for free, but still increase the value of the offering.
So you would be selling a lamp that should be worth $25, for $35, just
becuase you added a special guide on how to decorate your house
That way you can differentiate yourself, and overcome the fee’s issue…
Anyway, that’s what we think…what’s your take on this?
Karni and Jack.
Hi Karni & Jack,
Yes I totally agree! As you know I am a HUGE advocate of adding value to a physical products business through the use of info products/video etc. It helps to differentiate your business, garner loyal customers, position yourself as an expert in your niche and add value to your offering.
And you absolutely CAN charge more for your products when you add value in this form! It’s a strategy I would definitely recommend to build in more value in order to charge more and offset the fee increases.
It’s not a strategy that will work for every item/market though. Many buyers will just want the product and won’t to pay more for a digital value add. And where we really run into trouble is when the market wants only the product AND the product is heavy. If I sell lawn mowers, and my customers just want the lawn mower at a fair price, there is a hard cost of shipping to transport that lawn mower to my buyer. As a merchant I either have to charge actual shipping OR eat part of the shipping. With eBay taking a percentage of my shipping costs, I either need to raise my prices on the item or again, absorb the extra shipping fees.
Can I raise the price? Maybe. If there is enough demand for the item. But if 20 other sellers are selling the same lawn mower at or below my price and I am already operating on a thin margin, buyers will buy the lower priced item UNLESS they really want my value add or the service I provide.
Unique one-of-a-kind product sellers won’t run into a problem so much as will sellers of common new consumer goods.
So it really all depends on what you sell and your model, as to how these new fees will impact you.
It was great chatting with you at LOL :0)
These new fees will adversely affect my bottom line on eBay. I will definitely need to bump up my average selling price now. This will be a great motivator for me to start selling on Amazon. I certainly hope eBay will reconsider this. Do you think this is even remotely possible?
Ebay is new to me but your explanation was very informative and easy to understand. Thank you for taking the time to break it down for us.
I am an established but smaller seller and this will effect my total business. Since I have been on ebay for 10 yrs selling primarily vintage and collectibles, I have seen the fees continue to go up and profits going to the point that I will eval whether it is worth it at all, considering my time. I am not interested in sourcing new as I sell other peoples things to help them dclutter! It is tough as it feels like such a slam by ebay – Amazon is not an option for me for what my business model is.
Hi Lisa – Thanks for the analysis: I shipped a 21 pound banjo ($36 shipping) and a 25 pound Inuit sculpture ($60 shipping) last week – free shipping is not expected on these items by my customers (collectibles) and this is highway robbery.
GREAT to spend time with you and Maida at Lynn on Location! Yes, this is perfect example of why this new eBay fees policy does not work for sellers or buyers. On the items that you shipped, your customers do not expect free shipping. Not only that, if you build in a $60 shipping cost into the starting prices of the collectibles auction, you’ve just killed your auction strategy. If you build it into a fixed price cost, your buyers have NO idea that your item is so expensive because it costs $60 to ship it.
And worst of all – (since you have a store) even though you will pay 1% less on the Final Value Fee of the item, you are now pay FVFs on that $60 shipping price (whereas before you wouldn’t), which means your margins just shrunk on that sale.
The only people who benefit from the lower FVFs are those who ALREADY included the shipping costs in their item and were advertising free shipping. Which works for a limited number of business models.
My average price point is $15 + $6.95 shipping. This will increase my fees from $1.80 to $2.40 or an increase of 33%!!!!!!!!!!!!! My business can’t take this hit!
Margins on ebay are already tight and the market is significantly down. I’ve begun using Amazon more and more. Quicker listing, more responsive customer service, more sales.
That’s excellent! Keep selling more on Amazon! Anyone who has products that can be sold on Amazon needs to test out that marketplace. Sales are stronger, price points are higher, and while they have strict rules, it’s a very simple selling structure.
Traffic and sales on eBay are down – you are correct. And what needs to happen is a real reduction in fees, so sellers can make a decent margin on everyday products. Sure there are collectibles sellers who do very well or people who sell items in high-demand that are making money OR the high-volume sellers. But the majority of sellers sell “every day” products and their margins are squeezed thin.
Keep doing what you’re doing and building your Amazon sales!
I offer free shipping on most items – I just include the shipping cost in the cost of the item. I sell mainly light weight items – clothing, shoes, handbags – so I don’t know that I’ll see much of a difference. International buyers have shipping costs added by eBay, so I guess I’ll be affected there. But I don’t like how this will impact sellers with heavy items. Buyers are looking for bargains on eBay, and if sellers have to increase their prices, it will be bad for sales.
Yes in your situation, because you are selling light weight items, you should see either a reduction in fees or it will stay about the same. For your International sales, you will pay more in fees because shipping Internationally is so much more expensive. But there is HUGE growth in International sales – so it’s a market that people need to sell into.
And you’re right, people who sell heavy items are the people who will be effected by this the most. Buyers ARE looking for a bargain on eBay. Unless you sell unique one-of-a-kind collectibles or hot in-demand items, you only have so much price elasticity in your product price. To remain competitive, sellers need to keep their prices in line with the market. Especially if you sell in a category where you have a lot of competition and your margins are already thin.
This is just another nail in the coffin for me. As someone said, it is no longer eBay, but Greedbay. I started last October selling on Etsy. Insertion fees and final fees are so much lower on this selling site. I am gradually building enough business, that in a few months, I will be closing my shop on eBay. Another big complaint of mine is the seller can only leave positive feedback while buyers can do anything they feel like doing. The buyer holds all the cards on eBay. Even though I send an email asking to contact me if there is a problem, they will just leave 1s 0r 2s on DSR–usually positive or neutral feedback. I have worked so hard trying to keep my top rated seller status, but again, someone has left a low DSR so I will be losing my TRS status and my 20% discount. EXTREMELY Frustrated does not even begin to describe how I feel!
I find it insulting that Ebay thinks the Sellers are stupid and unable to read between the lines! When I read their entire long drawn out blowing in the wind information, I felt like someone was peeing on my leg, and telling me it was raining outside!!! I think this boils down to just plain greed. Yes Ebay has one of the more visible sights, and it offers a very diverse clientele, there comes a point that one must ask themselves “Is it worth it”?. I so wish some of the other online auction sites/selling sites, would create an import system that would capture the important data from our listings on Ebay, so we would not have to start from scratch on other sites. Addoway seems to have figured out how to do this!
It makes me wonder why some up & coming entrepreneur hasn’t thought to create a site like Ebay, with less restrictions for the Sellers, so we could sell in a pleasant environment for once. They would make tons of money, and as long as they didn’t become “GREEDY” they would certainly capture the Ebay Sellers that want to abandon ship. Ebay is just exhausting; we cannot keep up with their changes. Their representatives are no longer knowledgeable; customer service has gone by the way side. There is an inequity here that goes against my grain, what happened to equality?
One thing Ebay is not; is Equitable to the Sellers……..
Carolyn, you should check out http://www.bonanza.com. You can automatically import ebay listings. The fees are extremely low. The only drawback is that they do not advertise for you so you have to work harder to draw customers in.
The change will affect me positively as a seller, as I sell lightweight items (jewelry and books) and offer free domestic shipping anyway.
However it will definitely have a negative effect on me as a buyer. Living in a rural area, I do buy heavier items on eBay and have them shipped here. Most recently – tires for my Jeep. My next purchase is a front door for our house. I can get a generic one at Home Depot, or this really cool one, customized and pre-hung on eBay. You can bet I will be making the purchase before April 19!
Well, I think I now have to start using my website as a selling point rather than just a way to promote my Ebay business. I sell primarily low-cost items with low shipping so while my fees won’t increase dramatically, they will increase enough that I will have to experiment with my website as a venue.
My hope, and it is just a hope, is that Ebay will rethink this. I do not object to them taking a % of the shipping cost as it does thwart those who use shipping as their primary profit maker. However, I feel a more significant drop in the final value % would have been more fair. 11% – 13% is too much.
The price increase / decrease works For my business.
I have been selling on eBay for quite some time, and competitors are posting items for $10 and $12.00 shipping, they were gaining the final fee on the shipping, but I offered free shipping, therefore I paid the final value fee all along, out of my pocket.
It looks like eBay is going after these practices.
I would like to touch on the topic of FREE SHIPPING, the bottom line is, someone has to pay for shipping, it has to come from someone’s pocket, when you offer free shipping, you pay for it, and build it in with the cost, and charge for it.
The customer is really suffering because when he orders 2 or 3 from the same item or from the same seller, the seller could combine shipping, but the customer is paying double or triple for the shipping that is build in to the cost, assuming the costumer will buy one.
In the other hand any change to increase fees at this tough times, is a practice against bussinesss, I call it “Anti Bussiness Solucions” to divert customers elsewhere.
Hi Shmaya, Yes, for those who have already included shipping in the cost of the item and have been paying the extra FVFs all along, this will be a fee decrease. So you are ahead of the game, which is good. And it’s awesome to hear a positive outcome of these fee changes.
If you’re competitors now decide to fold their shipping costs into the item price, you’ll need to think about something new to differentiate yourself from them. That will be important. I’d focus on service, value, selection. And you’ve probably built up a loyal customer base with free shipping. So keep doing what you’re doing!
And I agree with you 100%. Increasing costs for small business owners when we are still in a shaky economy is anti-small business. Small businesses make up the fiber of our economy. We need small businesses to be profitable. If this eBay fee change benefited all sellers, it would have been such a boost to small business owners, eBay’s sales and our economy.
It’s a shame it went the other way.
This will be a big problem for my customers who sell reborn dolls on eBay, which are both heavy and often oversized. The dilemma is that the buyers for these dolls are used to buying on eBay. Sellers have tried other sites, but the customers just aren’t there. At this time Amazon isn’t an option, because the dolls are one of a kind.
As I was sipping my morning coffee my wife Camille was reading me your blog post from above.
It made my blood boil!
As you know eBay allowed me to escape the corporate world and start a true home business while spending the day with my family. Like you, I was able to take my experience and success and help others to do the same.
Teaching tens of thousands of other people how to make money on eBay was a very satisfying way to spend my time, energy, and resources. I remember a couple of GREAT eBay LIVE events where sellers where excited (and profitable) and eBay was growing like crazy. When someone would walk up to me and explain how a single technique or method they read from my newsletter made them a ton of money, it would warm my heart.
Those were the good old days.
Since then eBay has continued to do all it can to exterminate the mom and pops who built them, and tilt the “level playing field” so that only big sellers can “maybe” make profits. (There are lots of golden boy power sellers who crashed and burned)
eBay’s changes over the past years resemble much of corporate America where everything is out-sourced. It seems that small sellers from Asian countries are doing fairly well. But it gets more and more difficult for the small time American to make money on eBay.
My take has been that for the past 3 or so years, eBay has “Amazon envy”. Amazon is a fantastic company both for buyers and sellers.
eBay is like having a landlord that increases your rent whenever he feels like, or tells you to get rid of the dog you’ve had for years.
Folks, you can’t build a business model around that!
On the positive side, eBay’s constant anti-seller mentality has helped create some wonderful alternatives like Etsy and Amazon.
It simply makes me sad. This latest change about FVF on shipping is another nail in the coffin for small time eBay sellers.
Sellers… eBay doesn’t care a rat’s butt about you. They do not care if you are out of business tomorrow. The would prefer you would go away so they can focus on their big sellers.
Do not feel any loyalty to eBay. Take care of yourself and investigate selling on Amazon, Etsy, your own website, etc..
Hey it’s not personal, it’s just business.
I sell personalized sports medals on ebay. My shipping is a flat rate (USPS small flat rate box) with insurance at $7.00. My products list at $1.50 to 2.95 each. Of course very few sales are a single item. Average is about 10 to 12.
Still unit pricing has to be competitive with web sites offering the same type items. I have no choice but to raise the shipping charge and that will kill sales. Now I will need to charge $7.75 to cover the change in FVF. If I continue selling on ebay at all.
Hi S W Martin, and you bring up a very good point. Comparison shopping is the name of the game on the Internet. And there is a fixed cost to hard goods.
And people price compare on the Internet. It’s one thing to add in shipping to the item price and still be in the ballpark of what other sites are charging online. But if everyone else on the internet is charging 1.50 to 2.95 + shipping and that is the model for the market, that’s what those customers expect.
Now if you could charge 1.50 to 2.95 and offer free shipping, you’d have the market cornered! 🙂
In your specific situation though, I would add the extra $.75 to your shipping price and really beef up all your sales copy, your customer service message etc. to let buyers know if no uncertain terms that YOU are the merchant of choice when it comes to buying personal sports medals. Because your products are light weight, you do have a very good chance of remaining competitive with that extra price increase. You could even do some personalization that others don’t.
So don’t give up yet! Test out some different things. In this situation I think you can still make it work.
thanks for your update
i strongly believe in the changes on eBay
we where selling on eBay for over a year and we always offered free shipping because we knew that their is a demand for it from customers. but we never understood why when someone charges shipping, eBay won’t deduct the percent on the shipping $22.00 plus $3.00 shipping is the same thing then $25.00 and the person who offers free shipping is because he takes his shipping cost and he combines it in the price. so i never understood it and i am happy they are finally changing it.
second i think that now it will me a smart idea to open a eBay Store we never did because we didn’t see any money making option only a marketing tool but now i think it will pay
thanks for the update
It’s certainly the seller’s choice to include free shipping. For some sellers, free shipping works. However, many sellers who sell used or one of a kind items on auction, free shipping is not an viable option.
I sell a lot of heavy items and many items are also shipped internationally for which the costs are very high . I only charge actual shipping costs with a $0-$2.00 handling fee. Why is it fair for sellers like me to pay a final value fee on shipping costs. We recently sold a “lot” of items that went to Australia. The shipping costs were $800. Do you think it’s fair for me to have to pay over $80 in extra fees because we sell to international buyers?
I agree that sellers who manipulate the numbers by undercharging on the sales price and/or overcharge on shipping should be forced to stop this practice. However, there has to be a better solution than the one eBay chose. These sellers are the minority and not the majority.
This is not a good change at all.
I read eBay’s message about this yesterday with great frustration. It seems eBay is really out of touch with seller’s needs and to make a change like this is just more evidence of that.
Perhaps it is time for sellers to find another auction site. The thought of moving 500+ listings to another site is daunting and I’m not thrilled, but what is the sense of staying with eBay and not making any money on those things?
Up to now I’ve rarely offered free shipping because it was obvious that I would be charged a FVF on the total price, and I didn’t want a higher fee due to the shipping costs. If shipping is a business expense, how can ebay even do this legally?
I’m looking forward to hearing what you’ve considered as options. Thanks for your blog; I’ve just subscribed.
do you think that now we’re alll going to have to have our own websites in order not to lose our prfit??
The problem is that depending on what you sell, a website is not going to be as effective as the eBay marketplace. In your niche, you have the perfect market at eBay. People come there looking for your products.
With a website, you’ll need to spend a lot of time and money to get traffic to that site. Not to mention, that on eBay – you have the auction option. On a website you don’t. For some established sellers of niche new consumer goods, a website makes sense. But for products, eBay is still the best marketplace. Even with the fee increase.
I am quite upset over the announcement and called eBay to try and get a clearer idea of what it entailed. Mistake. The customer service people knew less than I did and kept repeating the same incomplete information over and over to me.
The one issue that wasn’t brought to light about eBay forcefully “encouraging” free and low-cost shipping is…..what if you need to refund a purchase to a customer? Now you will have to refund the amount you built in to the purchase price to cover “free shipping”…….. or you may get dinged on your feedback and DSRs as giving only a partial refund.
I will not offer free shipping! People do NOT appreciate it nor do they understand the true cost if it is not seperated out. I have started printing the cost of shipping on the shipping label and highlighting it so that people can see what it actually costs.
Your insight as always is so helpful. I think offering free shipping on items that you can (and I have some) incorporating the cost of the shipping in the price will reduce FVF because you get 20% on the total. It is just arogant that ebay thinks droping the item FVF 1% and charging 11% on the higher shipping cost is a good deal.
Dinnerware of any kind is impossible so I will increase my handling fee to cover the 11% and let my 1000+ email list know why. As eBay tries to overtake the clear winner Amazon, they will probably stop giving us the email address so that we can’t take our customers with us. Like Amazon, they will hoard them. But unlike Amazon, they don’t have the warehouses of goods to sell to all the hungry buyers. Once the unique items, low cost replacements and other interesting things dry up all you will be left with is Box-Mart type junk returns, overstocks, and phones. Their bottom line will drop more.
I would like to have discussions on which is the best venue for the item, dinnerware, collectible, home decor. Pehaps if we get the word out to our buyers where all the really good sellers are going – they will follow.
Afterall, good sellers are not good because of STARS, they are good because they believe in fairness and true customer service. We just need to shine more off eBay! I know we can do it.
Times like these the tough have to get going — so we need a plan and we need to broadcast that plan. There are some many ways nows to get the news out.
Remember God is Good, everyday — so fear not!
From my understanding, we will not get the 20% discount on the FVF for shipping.
We also return any excess shipping charges to our buyers. I doubt eBay will refund the FVF for this refund.
You’re right. We must look at other venues.
Yes David, that is correct. The TRS 20% discount does not apply to shipping charges. It only applies if you fold in your shipping with your item price.
And they confirmed in yesterday’s eBay Town Hall that if you refund a buyer for partial shipping charges there is no system in place to credit the partial FVF fees for the refunded shipping charges.
Hi Lisa, Your blog was very informative, thanks. For a long time I have contended that eBay favors buyers over sellers. This new announcement is more evidence of that. In my opinion, this is a backward attitude because if eBay had no sellers, who would be their buyers?
Arghhh! I have been off of selling on ebay for awhile. Now, we have been selling some items. And then WHAM… raising the final value fee. this will hurt! Don’t sure what we will do yet. We really appreciate you breaking it down in such a manner. Thank you!
I can see that in some cases ebay needs to do this, who hasn’t found that item that is marked at .99 but the shipping is $50? For those sellers, this will be the fix. But for those of us that keep their shipping cost as low as we can, sometimes charging less than it costs, this is a big blow to our very small bottom line. After so many years on ebay I am really wondering if it will be worth continuing? Sellers who play by all the rules should be rewarded by ebay, not hurt by across the board changes!
Hi Lisa, When the new fees were reported, I knew that many of us were going to take more of a cut in a prescious profit. What we sell on our own site, usually can’t be found elsewhere. Some item’s do quite well but with the economy as it is, losses were/are felt…now there may be more of a loss. We strive for high result’s within all facet’s of each auction and take pride in what we do…in spite of what the economy is doing.
As the higher ups at Ebay sit around the round table to evaluate what Ebay should do, they should please remember that Ebay and sellers need each other and sellers should not have to pay the biggest price for what should be a mutual and FAIR arrangement. We need to work together!
I totally agree! Small business owners are the fabric of this economy, and eBay is home to millions of small business owners. That in and of itself should be enough of a reason for eBay to take extreme strides to create seller friendly policies.
I realize that eBay also needs buyers, but buyers are not coming to eBay for free shipping, they are coming to eBay to find “IT”. Do you remember that advertising campaign from a few years ago? “IT” are the products you can’t find anywhere else. “IT” is the experience of buying from a mom and pop shop rather than a big box store.
What eBay buyers want is great selection. They want a fair price. I don’t believe that buyers really want to scrape products from sellers at a margin that is so low, that the seller can’t make a living or loses money. Sure there is a segment of our society who doesn’t care. Buyers who have been turned into overindulged, whiny, spoiled brats that wear their shoes for a year and unethically return them to Nordstrom. And Nordstrom refunds them in the name of customer service. THAT is happening on eBay and that has to stop.
And eBay sellers certainly aren’t looking to make a killing on each product they sell on eBay. All they want is a fair price for what they sell. And to be able to bring it to market at a reasonable cost to them.
And you’re right, without sellers, eBay has nothing. They are not Amazon. They do not bring inventory of their own to the table. Granted, eBay now has the big box sellers. The deals with Barnes and Noble. I believe that big box sellers and small sellers could co-exist in the eBay marketplace IF the marketplace was a level playing field like it used to be.
You are 100% right. What we need here is a fair and mutual arrangement. eBay and eBay sellers being able to work together with a common goal – to bring “IT” to the marketplace.
That’s the eBay buyers loved. And that’s when eBay ruled the world. It was an awesome place. Because there was community and a solid, positive amazing business being built. And that’s what I’d like to see happen again.
A fellow QC’er made a good point. Auction listings fees will show an increase if we all move to FREE shipping. In order to cover the shipping within the listed price, it means we move up to the next tier level in costs. It doubles from .25 cents to .50 cents & so on! That too, will add up over time!
Mandy, that’s a really good point. For store owners, as soon as you move that shipping cost into the item start price, your insertion fee goes up.
And it will add up if you are a store owner who lists a lot of items in auction format. Sure you can move those items to a second ID without a store, but there’s a ‘time cost’ involved in managing multiple IDs as well.
I ran an item by item analysis on our sales for this year. Overall the change will result in approximately a 30% increase in eBay fees. This will not encourage free shipping since the new fee is based on the total transaction value – well it might if you add the shipping cost to the product cost, as we do with media products. In the media category we will realize an approximate savings of 7%.
Lisa, I had not thought about the fact eBay will now be charging the fee on what amounts to a business expense – this is just patently wrong.
Your other point about the diminished value to customers on the effect of free shipping vs. combined shipping discounts is one I made to eBay executives over 2 years ago. They could not answer this issue and simply avoided discussing it. Quick example: Let’s say a book sells for $5 with $4 shipping. Combined discount is $1 for each additional book. Three $5 books would then be $15 plus $6 shipping total $21. Adding the shipping cost to the price of the book – now $9 each – makes the total purchase $27.
What I would like to see someone do is compare eBay selling fees to Amazon. I think, but cannot prove, that Amazon fees are still higher. Although Amazon does not charge their fees based on the shipping cost. Amazon does control the shipping cost often causing the seller to absorb the additional cost of shipping.
I have two suggestions for eBay: 1) Stop trying to be Amazon – you were winning until you tried to emulate their business model. eBay is not Amazon and never will be – more importantly they should not want to be. 2) Stop giving preferential treatment to the big retailers – they are only using eBay to dump products they cannot sell elsewhere. This alone has cost eBay hundreds of very good sellers who have moved to other platforms. Large numbers of listings do not help eBay if they are discounting or even allowing the big retailers to list free. 2a) Start charging the big sellers the same fees as everyone else pays – level the playing field.
You make a really good point. When you add in the cost of shipping to the item, there is no opportunity to combine shipping for you products, resulting in buyers paying a higher price. This certainly does not serve the customer or “make for a better customer experience” as eBay is fond of saying.
And you’re right – eBay is not Amazon and it had a really good thing going when it was focused on being eBay! I was looking at a Channel Advisor webinar today and they underlined the fact that eBay is still not growing at the pace of ecommerce. Amazon has blasted past the growth of ecommerce. Even after a few years of changes designed to increase sales, eBay is losing market share. eBay was a GREAT community and still could be a top marketplace today, if they stopped trying to be Amazon.
I think when all is said and done, Amazon fees are still higher. But it is so much easier to list and sell on Amazon. And I will gladly pay higher fees to them because they handle the customer service, it’s easy to sell there, their customers spend more money and shop more frequently – especially the prime customers.
On that note, I don’t think anyone would mind paying more fees to eBay if it were simpler to sell and they were bringing the buyers in, in droves. It’s paying more fees on fewer sales and as you said – not selling on a level playing field that is a big part of the problem.
As always, there is an unstated REAL reason why eBay does what they do, and it INVARIABLY can be traced to THEIR bottom line. Look past the SPIN they always put on their announcements. They have nothing to do with saving seller’s money, improving relations, blah, blah, blah…
In THIS case, I assure you that the REAL reason they want to charge fees on the shipping cost, is because there are still SOME sellers who deflate their sales price, and multiply their shipping costs (AKA, “fee avoidance”). This still goes on, despite all the noise eBay made years ago about “cracking down” on such practices to eliminate them. I was just looking at a lightweight lot yesterday, and noticed a $100.00 shipping cost. (You could ship that lot anywhere in the world via Express Mail, and it wouldn’t cost that much; but this was a DOMESTIC lot.)
SO, to make up for the FEW, UNSCRUPULOUS sellers who are ripping eBay off, eBay will now make ALL sellers pay! (I’m sure it doesn’t hurt their feelings that this policy will MORE than make up for what the crooks were stealing from them before…)
Anyone want to join a pool betting on how long it will be until eBay reaches the point where WE will have to PAY THEM for the “joy” and “privilege” of selling things to send them ALL the money?
WOW… 11%… I was hoping that I could find out what the projected new fee would be. I was thinking maybe 6% would be okay, But 11% across the board. NOT FAIR. I sure won’t be buying any more heavy stuff to sell.
Even my lightweight paper items…. this will add an additional 20 cents in fees to each. I was considering another china set to purchase but with heavy stuff, the ACTUAL shipping cost is often as much as the item itself. Like the lamp scenirio. I will be taking another look at etsy for vintage collectibles. And amazon isn’t always the option. Maybe opening a website with links to all my different sales venues.
Maybe Amazon will step up to step-in the gap.
While I am not happy with eBay’s announcement, I want to caution people who see Amazon as a great cost saver. In many categories, Amazon’s fees are 15% which is way more than FV fees & PayPal fees combined.
Yes, selling on Amazon has brought us increased business and I don’t have to worry about being paid, even though it is delayed two weeks. But their rigid shipping policies make it impossible for me to sell outside the continental USA. With eBay I can gladly give people quotes on a specific item to Germany or Brazil or Australia. But since some of my items are over 100 pounds my costs vary tremendously depending on where it is going.
So yes, I will be staying with eBay because it brings us more business than the smaller sites do. I wish they were more popular, but the reality is that eBay and Amazon are our major sources of business.
Hi Bill, You bring up a really good point. Amazon is not marketplace utopia. Many of my clients are doing very well there. But there are opportunities that you don’t have on Amazon that you DO have on eBay.
What’s important is whether or not a site is profitable for you.
eBay is still the biggest game in town for one-of-a-kind items and thousands of product categories. As well as International sales. There are more than 17,000 product categories to sell in on eBay. On Amazon there are about 25-30 now. The sales and traffic are still not there on other sites.
And you are absolutely doing the right thing by focusing on your two profitable marketplaces – Amazon and eBay.
So it’s still a matter of figuring out how to make eBay work for you, if
Thank you for the updates.
You know who this will also impact?
The folks that sell and ship Internationally. I sell sunglasses….they sell for $80.00 or so…the International Shipping USPS PRIORITY is $32.00 to $35.00. I do not charge any handling fees, just what USPS charges me. ***You have to have tracking for international shipping, per PayPal to protect the buyer.
I will have to re-think my international sales.
Elisa / faith55 on eBay out.
Hi Lisa, I am so upset to hear this. I have been selling children’s clothing and women’s plus size clothing but have decided to start selling dinnerware and collectibles (I have purchased quite a bit and am just getting ready to start selling it). As you know, these items are quite heavy and I certainly can not offer free shipping. I have been very upset with eBay and would quit as of selling yesterday but I have so much inventory to sell. I started selling on eBay in 2002 and have been selling as a business every since. eBay has had so many increases in fees that I can hardly even make a profit. It seems like prices of items have steadily come down and if you want to sell an item, you have to keep the price down. I truly feel that eBay is on it’s way out, especially with the new changes at Amazon with the Fulfillment Center. I just may start giving away all my inventory verses taking a loss on everything. Thanks for keeping us infoirmed.
Oops on spelling error…it is informed notinfoirmed. Sorry! I have not read how this will affect me on global selling but I have a feeling that I am done selling Internationally. With all the Postal increases and now this, I don’t see how I will sell anything.
Hi Dave, Your dog is SO cute! Was he/she the inspiration for your company name?
Yes, in your situation, this is a win – because you were already adding in the shipping costs to your products.
And for many people this will be a WIN for some of their products and a LOSS for other products.
Their fees might go down for half or their products and up on the other half. And what matters is where you come out at the end of the month.
Yah, the impact on International sales is not good. And with International sales being the fastest growing ecommerce market, online sellers NEED to leverage that customer base. It’s good for sellers AND it’s good for eBay’s bottom line.
If a seller stops selling Internationally it will decrease their overall sales. However shipping Internationally is expensive so for many people, it will increase their overall fees. Even light weight stuff is not cheap to ship Internationally.
I definitely DON’T recommend that people stop selling Internationally – there is too much opportunity there to give up that slice of the market. Which means it’s back to the drawing board to figure out how to offset those new FVFs.
And I agree – I can’t think of a business right off hand (except maybe Apple Inc.) that hasn’t had to be sensitive to current economic conditions. Putting many sellers in a position to raise prices across the board for buyers who come to eBay looking for great deals won’t help sales conversion.
On a side note – what I find so strinkingly different about this FVF change is that it affects sellers in different product categories so COMPLETELY differently. Prior fee changes have pitted the big sellers against the small. Now we’re seeing some small sellers who will benefit and others who won’t. And it all depends on what you sell.
It’s been awesome these past two days to see sellers stand in solidarity of their fellow sellers – no matter what category they sell in!
IT would be great if we could get 1000 people that sell on Ebay not to sell for two weeks or more.
Who’s pocket book would that hirt? Or get them not to sell the first week of each month. My self I am looking for a new Auction site to sell on.
Hi Lisa and All,
I have been working all night on the impact my ebay business will take with the new fee leveraged on shipping which I now charge. Strange thing is, my clients love my service and over and over again , comment on fast shipping, nice packaging etc…all BECAUSE I charge priority shipping and deliver fast. I have TRS all while doing this. If I now have to wrap shipping fees PLUS ebay’s take on it I am not sure my clients will find my items competitive. What worries me most is that the so called fee reduction only applies to the first $50.00. My items often sell at much higher than that and will be charged at the 12%+??? I am trying so hard to find the upside to this and all I get out of any computation is HIGHER FEES
Yes so currently if you list your clothing items at fixed price, being a store owner you are paying 12% on the first $50 and 9.0% of the remaining final sale price balance ($50.01 to $1,000.00). Beginning in July you will pay 10% on the first $50 and 8% on the remaining total sale price balance. So it drops 2% on the initial $50 and 1% on the remaining balance.
However, since you are not currently folding your shipping into the item price, you’ll be paying 10% and 8% on a higher total amount on anything over $50.
Depending on what your shipping costs are, this reduction in FVFs may or may not make up for the new FVFs on the total order price.
Run some of your items through this Fee Calculator and let me know how you fare: http://pages.ebay.com/sellerinformation/news/Feecalculator.html#
(Unfortunately the new Fees calculator doesn’t show you the new fee versus the old fee, which means you need to find some data on current fees and compare it to the new fee.)
Be sure and use the Clothing, Shoes and Accessories category as those fees are different from the other categories.
In your situation it may be a case that some items you come out ahead and others your fees increase.
That is the most common scenario I’m seeing.
Hi, Lisa, and thank you for always getting to us the “in a nutshell” version of eBay’s goings on.
I believe Dave put it best as far as my situation goes. I am also a TRS who has offered my products with shipping included since eBay first paired it with elevated page positioning. I personally should benefit from this change. That said, like Dave, I think this is an appalling move by eBay. I am also wondering about the legality but feel certain eBay must have taken that into consideration.
I avoid like a plague the use of the term “free shipping.” I prefer “shipping included.” I also know that when eBay surveys customers and using the term “free shipping,” there is no way to know whether customers are actually expressing a demand for something “free.” The survey may have the same results if the term “included shipping” were used, thus indicating a preference for convenience rather than a preference for “something for nothing.” I think buyers are smart enough to know when shipping costs are actually borne by the seller who is taking a reduced profit margin. All buyers know that FedEx/UPS/USPS all have to be paid.
My solution for many of the hurdles to selling has been to bundle items and include shipping. Bundling goes a long way in covering competitive pricing and shipping charges.
I have begun selling on Amazon, but it is not really the solution for “problems” with eBay. It only makes sense if it is profitable and from a multi-venue business model so eggs aren’t all in one basket, so to speak.
If not selling from an existing page, you can get lost in the huge learning process. If selling from an existing page, I find that it is difficult to compete.
A pro-merchant account and UPC codes are required to sell something not already out there, and individually creating new pages for listings is tedious.
In addition, the rules go on forever and are not easy to find, though you can actually speak to someone, and the folks are friendly and helpful.
Books, tapes, DVDs, etc. still make the most sense there.
Bonanza would be my preference for an atmosphere of fun and camaraderie that is reminiscent of the former eBay. It is an attractive marketplace and site with integrity that is maintained by folks who know how to effectively automate processes. User-friendliness seems to be a priority. Unfortunately it is not well known enough yet. Etsy also seems to be a favorite with so many ex-eBayers. I’ve found most others to be a sterile as Amazon and as eBay seems to be trying to become.
As for me now. Like Dave Hutchins and Bill Keene, I will stay with eBay and Amazon. (I do have a Bonanza booth, but only because you can upload from eBay and kind of forget it until you have time/help to “work” it.
Great points! And I’m glad you brought up the topic of using the terms “shipping included” rather than Free Shipping. There was a consumer data study done a couple years ago that showed that the words”We pay the shipping.” or “Shipping Included” converted more sales than “Free Shipping”.
The reason given was that “Free Shipping” was overused as a promotion and the consumer perception was that the shipping was being padded in somewhere else (which it is unless a merchant can subsidize the shipping.)
You also bring up a great point about bundling! There are so many opportunities with bundling to differentiate yourself and offer competitive pricing and shipping charges.
Lisa…you stated that the March 15 2011 eBay Policy change of now charging Final Value Fees for BOTH SHIPPING & FINAL SALE VALUE “will POTENTIALLY amount to an overall increase in cost for millions of sellers…”
No Kidding!!!! There is no way that eBay can spin it any other way than a DRAMATIC FEE INCREASE FOR EVERY SELLER ON THE SITE…..To do otherwise is an attempt on eBay’s part to perpetrate INTENTIONAL FRAUD on the Ebay Seller Community…..
Shipping rates on a high percentage of heavier items, books, used items and collectibles are rapidly approaching the value of the product being sold….That being said, eBay’s decision to charge FVF on both Final Selling Price and the Shipping Cost actually DOUBLES the total eBay Final Value Fee (FVF) to to a high percentage of eBay Sellers…..In addition it will DOUBLE THE COST of the fees that Pay Pal charges the Sellers…..
And yet, eBay calls this a “FEE DECREASE” ????….The eBay managers and CEO are high on GREED and STUPIDITY
Just another move by eBay to DEFRAUD the eBay Sellers….We all need to spend our money on building our own commercial Web Sites and then file formal complaints to our local State Attorney General re eBay’s Deceptive and Fraudulent Business Practices….Consumer Fraud is a serious matter in most States
eBay needs to be held accountable for their greed, and deceptive business practices.
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
your math is a bit off
from 2.50 to 5.50 is about an 83% increase,
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 50%.
Thanks for catching that! I made the change to 83% in the post. Which makes that figure even worse. It was interesting to listen to the Town Hall this afternoon. The pat response was “Buyers have told us they love free shipping.” In ecommerce we’ve known that Free Shipping is the #1 promotion buyers prefer for years. But as a promotion – not as a general rule across the board! (Of course we’d ALL love free shipping, free products, free everything – but that’s not a realistic financial model for our society.)
i meant to say $3.00 to $5.50 is an 83% increase
i’m sure that looked great on paper when their number crunchers
came up with it…too bad they threw common sense out the window
where was Meg Whitman when they discussed this brilliant plan?
she’s still on the BOD
It is always obvious to most of us, what ebay’s bottom line is, I just want to know really…How can this be legal??? If it is not against the law to charge for services NOT rendered, Then I am insisting that all of you bloggers need to send $10.00 to my pay pal account immediately for reading all of your blogs…lol, but not really!
Elizabeth Warren of the Consumer Protection Bureau – where are you? If charging FVF on shipping is fraud and possibly illegal, shouldn’t this newly established agency be investigating?
All I can see is corporate greed here. I don’t understand why eBay thinks that they should be entitled to a percentage of the shipping fees. They have nothing to do with shipping of the item. Yes, they do have something to do with the item, giving sellers a venue to sell said item. Double dipping is going on here big time. Paypal owned by eBay already takes their (un)fair share of the total price when you use (and a lot of us don’t have any choice but to use) their service.
I am really considering selling elsewhere, I have in the past, and I am going to look into it again. eBid, etsy, ioffer are a few places that don’t charge an arm and a leg…….
This wouldn’t be tolerated in the real world of business, because business doesn’t work that way….
I can understand totally why there are rumours of boycott…..
I agree Angie. This is double dipping. With eBay and PayPal being one company. And PayPal being the “preferred” payment provider on eBay – this smacks of a monopoly and fee manipulation. And you’re right – I’ve never heard of any scenario like this with other businesses. Although the credit card companies have been manipulating fees for the past several years.
If you have another selling venue that you think might work for your business, it’s definitely worth a try. But if the majority of your money is made on eBay – don’t pull your items until you have the other site up and running. Simply to preserve your financial stability.
The FVF on shipping cost is an incentive to lower shipping… Well looks like I will have to INCREASE mine to cover the extra cost. Ebay traffic is down, sales are down and ebay is failing. Raising our cost to cover is loses will only result in more loses for them. Higher shipping cost or item cost will drive more traffic else where.
Truely stupid people now running eBay. Wish we had the old grew from 10 years prior who knew how to make it work. eBay is on a downward spiral, sadly, they will bring me and allot of other down with them.
subscribe to blog updates
Sellers of lightweight items will also see a fee increase, though not by eBay. USPS is jacking up the price of first-class parcels on April 17.
Hi Lisa, thanks for the great information. This is for Elisa and everyone who ships internationally. I was listening to eBay radio yesterday, and it’s my understanding that we will be charged final value fees on our item cost plus our DOMESTIC shipping cost, NOT on our international shipping cost. Even if the item is being shipped internationally, we will only pay FVF’s on the domestic shipping cost.
This goes for those who ship Express mail also. If you also offer a lower domestic service such as Priority or First Class, you will be charged FVF’s for that service even if your customer chooses to pay more for Express shipping.
You can listen to the eBay Radio Live replay here:
Lisa, it was great spending time with you at LOL, and I greatly appreciate your sourcing suggestions for bamboo items (thank goodness bamboo is relatively light compared to stoneware!). As you know, I have two eBay stores — auction-girl-vintage and kitchen-kitsch –both with diverse product lines that include lightweight and heavier items, and both of which already offer free shipping on items that ship inexpensively. So I may benefit — very minimally — on the products that already include free shipping, but I’ll be taking a huge hit on the heavyweight items.
For example, last week I shipped four $7.00 dinner plates to Oklahoma, and used Priority Mail at the buyer’s request. Total s/h fee charged was $21.00. I also shipped 17 pieces of dinnerware to Canada, and the actual shipping charges exceeded $70.00. Under eBay’s new fee schedule, I would be charged additional eBay fees on nearly $100.00 in “gross sales income” that is not income at all, but is a government-approved business expense. The additional eBay fees I will be paying are also a government-approved business expense, but I will not be able to deduct either of those expenses until I file my annual business tax return, which means I am losing use of my money for a period that could realistically exceed 16 months.
There is another issue here that no one has mentioned so far, one that concerns me greatly as a former accountant. 45 of the 50 states have a state sales tax. Current tax laws require sellers to charge state sales tax on items shipped to addresses within their own state (and to any state in which the business has a physical presence, such as an office or warehouse). Proposed legislation is attempting to require sellers to charge sales tax on any/all sales to any state that has a state sales tax, which many small online sellers consider an undue burden due to the amount of record keeping that would be required, and which many tax law experts believe is a violation of a 1992 Supreme Court ruling on the collection of sales tax by out-of-state businesses.
Under current law, most states (including California, where I live) do not charge sales tax on shipping charges, and eBay’s Sell Your Item form currently allows sellers to select whether or not sales tax needs to be collected on shipping charges. However, by encouraging/pressuring sellers into offering so-called *free* shipping, eBay is forcing sellers to charge — and buyers to pay — sales tax on the non-taxable shipping fees that will be embedded in the item price, instead of being legitimately itemized and shown separately. As a buyer, I am outraged and appalled that eBay is putting sellers into a position that not only encourages sellers to hide the actual cost of shipping, but also requires sellers to charge me sales tax that is not legally mandated, thereby increasing the cost of my item while also flagrantly increasing eBay’s income.
The only up-side here is that it increases tax revenue to the state(s), as they will become the recipients of windfall taxes that should not have been collected or paid in the first place. In addition, many states have recently enacted state sales tax laws for online sales that require out-of-state sellers to collect state sales tax if their online sales exceed $10,000.00 per year. Embedding the cost of “free” shipping in item prices could feasibly push some sellers above the $10,000.00 sales limit in some states, subsequently requiring those sellers to begin collecting and paying sales tax in multiple states … all because eBay has learned that “buyers love free shipping.”
For now — as with all previous eBay changes — I am rolling with the punches while evaluating my product lines and business model. I am also considering various ways of getting the real costs of eBay’s revised fee structure disseminated not only to the media, but to the buyers themselves, who should rightfully be staging a protest of their own.
Your thoughts on this additional aspect of the new fee structure?
Victoria Smith :o)
My eBay stores:
Lisa, Thank You for the information.I have 3000 items on ebay that range from clothing to Waterford..I usually offer free shipping only on clothing,scrap gold and coach purses..Oh and most of my Charity items..
FREE SHIPPING IS ALREADY BEING CHARGED A FINAL VALUE FEE.(IF YOU ADDED THE SHIPPING COST INTO THE SELLING PRICE)..We also will be “taxed”..ie..shipping/Fvf from both ebay and paypal..So we pay twice for the FVF..I understand that it is the cost of doing business,But the sellers need a break..MAYBE ebay Will let the store subscribers have 50 FREE AUCTION STYLE LISTINGS WITH THE FREE BUY IT NOW” LIKE they do for the Non Store subscribers..I THINK EBAY FORGETS THAT STORE SUBSCRIBERS ARE THEIR BREAD AND BUTTER..WE PAY THEM EVERY MONTH..Non store sellers are not charged a monthly fee..We need a break too.
Blessings..debra1711..ebay seller id
I closed my ebay store for this very reason last May. If I closed my store, saving $16 per month, I got the additional savings of 100 free auction style listings. Had we kept our store, our listing fees rose from 0.05 to 0.20. By closing the store, our fees went from around $60 per month to around $5.00 per month. It makes absolutely no sense to penalize store ownership on Ebay, but its their game to play.
I too am extremely upset by the new eBay rules. I am a powerseller and a top rated seller who offers Free Shipping on some items but not on others. I have been selling on eBay since 2003. The Pet supply business is very competitive, so if I raise my prices to cover the FVF fees on shipping I will definitely lose business. I took most of my products off of eBay with the last big changes and may end up closing my store with these changes….
Most of my sales are through Amazon, but I too want to caution sellers that Amazon’s FVF fees (at least in my category) are 15% on your product total AND the shipping + the monthly charge of $39.99 per month. An example: I’m looking at my transaction report for this month so far. One of my items sold for $53.95 and my shipping was $10.27 for a total of $64.22. The amazon fee for that sale was $9.63 which is 15% of the total amount (including shipping). It has been an aggravation with me for a long time that Amazon charges this percentage on shipping since as you say, it is a business expense!! By the way sellers DO set their own shipping amount on Amazon either based on parameters that they set or on a shipping override that they can upload that lets them charge any amount that they want to charge (or which lets them offer Free Shipping). Plus, if you do NOT keep up your customer service ratings by shipping on time or by getting good feedback, they penalize you in a number of ways. So you have to be a very customer oriented seller the same as you do on eBay not to be penalized by Amazon.
The other bad thing about Amazon is that they do NOT allow you to charge your customers sales tax like EBay does, so if I sell an expensive item (say $320.00) to customer that lives in my state, I have to pay 7% sales tax on that sale, but I can’t CHARGE THE CUSTOMER for that tax ($22.40 that has to come out of my pocket/profit). Amazon’s answer to that was to just raise my prices so that I wouldn’t take a loss if I DID sell to someone in my state. There is no way that I would do that to all of my customers (and if I DID, I would lose my competitive edge).
So Amazon is not as wonderful a sales venue as people seem to think (although it IS my primary sales venue at this time). I have a pretty new website that I am planning on marketing to the hilt so that I can get away from both eBay AND Amazon sometime this year. Neither one of them really cares that much about the seller.
Below are some other venues that people might want to try. Most are free or low cost with low FVF fees.
(1) http://www.bonanza.com Free to post; FVF are low and depend on sale (i.e. $10 for sales over $1,000). You can export your eBay listings into your store.
(2) http://www.pricegrabber.com: PriceGrabber attracts over 24 million unique visitors each month.
(3) http://www.ushops.com: (Free store-Currently there are no fees whatsoever associated with listing items within uShops).
(4) http://www.ecrater.com: eCRATER is a free web store builder..you can export your eBay listings into your store.
Lisa, thanks for all the indepth updates you give us.
And Mandy, when the item doesn’t sell, we’ve doubled our fees and have nothing but the bill! I am so bummed.
To all the people that keep saying Amazon will not work for collectibles, I beg to differ! I rarely sell on Ebay anymore and I was one that started back in 1998 on Ebay, Amazon is now my primary selling platform and has been for the past several years AND I DON’T specialize in books or media items! I sell a wide variety of non-media items on their site. If you have a merchant account you CAN create your own listings on Amazon . Even if much of what you list goes into the Everything else category since that category does not require a barcode to create a listing – and Amazon does seem to have limited categories – you will be fine! The items will sell and there is not much competition for oddball collectible items there! Plug in search terms in the space provided on the listing page that pertains to the item your selling. Alot of people search via Google and Amazon items come up right away and your item especially one of a kind items will be right on top. As far as restricted shipping amounts, when you create the listing of your item…. if it be a set of dishes, lot of 10 glasses or your lamp…whatever…YOU PUT IN THE WEIGHT of your what you are listing , 20, 30 lbs whatever you estimate the package to be and your shipping credit goes up for each pound. The shipping credit is NOT as restricted as many people think! Their shipping credit is not perfect, but its not as bad as people think. Also, Amazon does not offer combined shipping so if you get a buyer that purchases multiples, you will get credit for each one, sometimes you can make out a little in these cases or at the vary least it evens it out for when other items you sell and the shipping cost is not enough. The buyers don’t seem to mind and I’ve found you can get much more for items that Ebay. I know it sounds odd, but it’s true! I guess they are not penny pinchers like Ebay! For a listings that are already created and you use the sell one like it tab you will find that many sellers that list and don’t really know the ropes, do not input the proper shipping weight or leave it blank all together – which is the worst and I see that all the time, when that happens, the shipping rate alotted to you will be very low. But all is not lost! Once you know your way around there, you can go into those listings (if you have it in your inventory) click on edit listing, then..edit the correct shipping weight so you get more $$ credit. The only thing I find somewhat restricting is not being able to sell on Amazon outside the USA. Depending on the seller account you set up with Amazon, most items are only offered in the USA other than the book, CD, DVD & other media related categories. I’m pretty sure there is a higher tiered account that does let merchant sellers offer internationally. Many Amazon customers do not and will not shop Ebay and they do not trust Paypal. One thing is for sure – the buyers are there, they do not need to be coddled like Ebay buyers and the payment process is very smooth. I actually buy quite a bit from Ebay to resell on Amazon. Ebay is one of my main places for product sourcing!
Buyers like the reputation of Amazon and as long as you provide good customer service – I think most sellers that try Amazon will be happy there.
I am very interested in what you have written. It does make me want to ask questions. By collectibles, do you mean vintage/antique items or do they all have to be new in box?
Thank you kindly in advance.
I removed your email address from your comment because the spam bots love to find email address posted on the internet and flood you with spam. (When you add your email address to the blog comment field, it is not visible to humans or spam bots, so you’re OK there.)
The increase in FVFs doesn’t only affect collectibles sellers or one-of-a-kind items, it will affect anyone who either sells something heavy. For example, the person who ships 200 pounds of aquarium gravel at a cost of $65. That’s what it costs him to ship it. But the gravel itself costs maybe $50. If he tacks on the $65 in shipping to that aquarium gravel item price and offers free shipping he is now not priced competitively. On top of that, he is now paying FVFs on $75 in shipping charges. Where as before he was only paying FVFs on the $50 item price.
Granted his FVFs will drop from 12% to 11% (if he is a store owner). But if he pays 12% of $50, his FVFs would be $6. With the new fees he will pay 11% of $125 (item + shipping) and his new fees will be $13.75.
Now let’s say he is a TRS and he gets a 20% discount on his ITEM FVFs. Then he will pay $12.65 in Fees, because of the additional shipping fees.
So the reality of increased fees on certain items is the issue. And how to continue to A) Sell those items profitably or B) Sell other more profitable items so that your NET at the end of the month is profitable and growing.
You can do either vintage/antique items or new in the box items. If you have a merchant account, you can create your own listings. As I mentioned in my original comment, most items will need to be listed in the everything else category. Other categories require a bar code of 12 digits, some are 13. Since vintage items will not have a bar code, Everything else is the place to list. Keying in search terms when you list is important so buyers find your listings when searching any of the major search engines. The search terms are hidden, the buyer does not see them on the listing page. The merchant account fee is $40 per month, no listing fees and the items remain until sold or you delete them from your inventory. They don’t expire. It’s also month by month so if you want to try it out for a few months to see if this platform will work for you and if not cancel. You can list without a merchant account, Amazon charges $1. extra per transaction ONLY when if it sells, but I’m pretty sure listings stay for 90 days, they then move to your closed listings, where you simply relist. I also like the fact that I can find listings from my closed listing page from several years ago, unlike Ebay they remove them after 60 days or so. There is a guy that has wrote many e-books on how to sell on Amazon from beginner level on up, they are affordable and sometimes he runs sales on his books. Steve Lindhorst and his website is: http://www.MultichannelSurfer.com . Sign up for his ezine, lots of free tips just in his emails. He used to work for Ebay many years ago and is sort of the “Amazon Guru” who is more than happy to share his knowledge. As more people move away from Ebay from both buying and selling, I do believe vintage (one of a kind) items will pick up steam on Amazon. Buyers have become savvy over the years and many know that Amazon is not just for books anymore. Amazon does not have an auction style format, everything is fixed price. The fees are comparable to Ebay, but you can get way more money for items on Amazon and it’s easier to list items on their site and manage your inventory. Check out MultichannelSurfer.com, read some of Steve’s archived blogs and go from there. Hope this information was helpful to you. Best of luck!
Thanks for sharing this great advice about selling one of a kind items on Amazon! Being able to list in the Everything Else category without a barcode is a GREAT tip for people. As you know I highly recommend that people at least try listing on Amazon. It’s not the magic pill (no marketplace is) but there is a whole different group of buyers there (with some crossover from eBay), and it’s much easier to list and sell. And as long as you follow the rules, you can really do well. I also LOVE Amazon FBA!
Regarding Steve Lindhorst – Yes! I highly recommend Steve’s newsletter. He is a good friend of mine. We go way back. Fun story – Steve was working at eBay the first year that I spoke at eBay LIVE (2005). It was my first really big stage (over 1200 in the audience) and I was sooo nervous. Steve was the moderator for our presentation and I met him for the first time before I was getting ready to go on stage. I shared with him how nervous I was and he said “Nah, don’t be nervous, just get up there and talk. You’ll be fine.” And then he laughed in his friendly, relaxing way. I immediately liked him. I thought he was so nice, kind and funny. (And still do!)
So I get up on stage and give my presentation and it was there that I realized that I LOVE speaking to big audiences. In fact, I loved it so much I went OVER my allotted time. I was so into what I was teaching, that I wasn’t paying any attention to Steve in the back of the room as he held up the que cards to let me know how much time I had left. Finally, I looked up at him and he is in the back of the room making these frantic “cut” motions with his hand going in front of his neck. LOL! I quickly wrapped up my presentation to a rousing round of applause so the next speaker could take the stage. And from that point on, it was a running joke between Steve and I for several years – and we became good friends.
As it so happened, I emailed Steve last week and said “I have to get you on another interview call about Amazon.” So we’re going to chat next week and schedule it. It will likely be in early April. I’ll send out a notification when we do the call and post it here on my blog as well.
PS: There has been speculation that Amazon may move back into the auction business. I don’t put much stock in it – but when I came online in 2002, they were just shutting down their Amazon Auctions. Remember those?
Now THAT would be interesting if they revived that!
I just want to thank each of you for sharing your comments, insights, clarifications suggestions and personal scenarios here! I know this is helping a lot of people, so please keep sharing!
I’m reading through each comment and replying as well. I didn’t get through them all today, but will continue on Thursday. 🙂
My goal is to help everyone find and identify a strategy that will help your online business stay profitable and grow.
Also, I’ll be holding a free webinar next week to summarize and outline different possible solutions for the fee changes – and will post more details about it here in a day or so.
As with every seller release, not all the details are listed in the announcement, so we need to get all the details and then analyze the potential options and strategies for the webinar.
In case you don’t have the URL for the new Fee calculator, here it is: http://pages.ebay.com/sellerinformation/news/Feecalculator.html#
It doesn’t compare the new fees to the current fees structure so you either have to review your sales reports or compare the new fees using the current charts.
This one if for store owners:
This one is for non-store owners:
Overall you still need to look at the bottom line net profit at the end of the month with the new fee changes in place. Because of the variables, this fee change is (unfortunately) going to take quite a bit more analysis for each business owner than the previous ones.
It’s a fee increase for small business sellers, A HUGE one, there is no such thing as free shipping anywhere, the total cost is what counts and of course service and item quality. All this does is make sellers mesh their shipping cost to the item cost and hence you have a magical illusion called free shipping. People are in business to make profit and satisfy the customer, this fee on shipping is narcisism and sociopathic abuse by the rich and wealthy in this country, period. SINCE WHEN SHOULD SOMEONE DICTATE WHAT I CHARGE FOR MY BUSINESS. AND THEY DON’T EVEN GIVE YOU TIME TO PREPARE FOR IT, THE SLIME, Don’t let anyone try to sugarcoat what is actully happening, it is a huge increase in profits for a select few ebay ceos period. Don’t listen to any of this, its essentially a fee increase again, a huge one for small busines. They will increase fees again soon, and then what will you people thik then. They are going to fee you to death until you leave because that is what they want. WAKE UP, they can fee you anytime they want, ANYTIME on ANYTHING, anyone who likes this fee increase is crazy and not very bright, even if you offer free shipping they will come up with another disturbing rule soon to make you pay more again. LOL, wake up.
Questions about eBay Fee Structure at Town Hall Meeting
by: anthony colacicco
Thu Mar 17 07:28:29 2011
It is also very disturbing to listen to these ebay robots who want to sugarcoat what is really going on, IF YOU WANT SELLERS TO OFFER LOW SHIPPING OR FREE SHIPPING REWARD THEM FOR IT!!!!, YOU ARE IN FACT PUNISHING them by CHARGING THEM A HUGE FEE FOR IT!!!!! LOL WHAT IS GOING ON HERE. DON’T LISTEN TO THESE PEOPLE THAT WORK FOR EBAY, THEY WANT YOU TO LEAVE, THEY WILL FEE YOU AGAIN SOON, THEY CAN FEE YOU ANYTIME THEY WANT ON ANYTHING, C’MON, CAN’T YOU SEE HOW CRIMINAL THIS IS AND EVIL, MY BUSINESS AND MANY OTHERS WHICH I FEEL BADLY FOR HAS COMPETELY HALTED ON EBAY BECAUSE THEY GAVE ME ONE MONTH NOTICE OF THIS GARBAGE
Heres a question, will ebay charge based on actual shipping charges? IE, when I combine shipping for a valued customer I give them a reduced charge on each of their items after the first one, so will ebay charge me for the shipping amount in the listing or the reduced shipping that I actually collect from the buyer??? I already lose money sometimes doing this, now it looks like it will be more out of my pocket!
I need to clarify this – because I’m hearing different things from different sources. If you use eBay’s shipping rules and preset a flat rate for combined shipping, you will only be charged fees on that total shipping price. But if you combine shipping for a customer after the listing sells, you will be charged fees on the total of each individual listing. And eBay has stated that they don’t have a feature in place to credit sellers who issues refunds on shipping either.
I’m double checking on this though and will post here.
I just clarified this and I was correct in that you need to go through eBay’s checkout flow with combined items.
Here is the official stated eBay policy:
“eBay recognizes combined shipping discounts only when it goes through the checkout flow. We encourage buyers to go through the combined shipping flow so we know exactly the reduced shipping amount and can appropriately calculate the FVF on shipping cost.”
Hi Joy, they will charge you on the total sale including the shipping cost, it does not matter if the shipping is combined or not, you will be charged a fee depending on what kind of items you sell for the total sale if the buyer is in the USA.
Hi Joy, if you charge the buyer for giftwrapping for example, they will fee you on that too. The only thing they will not fee you on in the final total sale is sales tax. I’m sorry. I really feal bad for all the small businesses on ebay. They only gave you and me 1 month notice which is terrible.
Who can I physically speak to at eBay or anywhere else who will be unbiased and not give the standard pat eBay answers?
I wish I could tell you that there was someone at eBay who would not give you the standard eBay answers. But eBay is a big company and by default, employees of the company (any big company) are required to state the public policy. So if you were to contact live support or you had an account manager, they can only reiterate the standard policy.
I do want to say there are a lot of good people who work at eBay. But the people I know are not the ones that make the policies. I’ve known many people in the company since 2004, who even if they disagree with a policy are not at liberty to say anything other than what the public statement is. As employees of the company, if they want to keep their job, they must follow the rules.
But from a seller standpoint, it IS incredibly frustrating not being heard. People need to feel that they are being heard. I was really disappointed in the Town Hall yesterday with the way that some of the callers were put down for expressing their opinion, or those callers who obviously know their market and their business were told that they should not be voicing concern unless they’ve tried free shipping.
I felt that the way it was handled was completely wrong.
And I’m not trying to stir the pot here, but this what I heard in those conversations.
So that being said – the question comes down to how to make it work on eBay and should you continue to try to make it work on eBay? As a big company, they are not going to change their policies.
My concern is for people who want or need to sell on eBay – how to help them be profitable in the light of these changes. I wish I could tell you that a boycott or something would help – it won’t.
I’m putting together a free teleseminar to be held the last week of March that to both look at all the variables in this situation and offer some strategies that people can use/test to stay profitable on eBay. It’s not going to be a magic pill teleseminar that’s for sure, but I want to try and do what I can to help independent, small sellers.
Hey David, you cannot speak to anyone at eBay, they are all like robots. I spoke with three people there and all three of them were talking out of their ass. They were trying to convice me that by charging me a fee on shipping, I will have more sales and that it is better for the website. Listen, they are going to charge me and other sellers a fee on the entire transaction including shipping. How is that aiding the seller? If someone pays me $4.95 for a flat rate box to ship them something, ebay takes .11 percent from that shipping total. So, I am losing money by shipping this package. Yea, terrific aid, aid me some more. Maybe, next year, Mr.lashi, the vp of feebay, can aid us some more by stepping his retarded ass down and let someone with a heart and who cares about people make the rules. You’ll see too, Next, they will start charging a fee when the buyer has to return something to the seller, and say it’s a final value fee on RETURN SHIPPING. Kiss my ass
“eBay is now charging fees on what is categorized by your bookkeeper as a business expense. (The IRS doesn’t tax businesses on expenses.)” This is the true characterization of eBay’s FVF change. Small merchants are being driven off eBay. We cannot continue to absorb these expense increases. Most of us operate on a very thin margin, and are engaged in very competitive product lines.
It would feel better if eBay would even listen, really listen, to us.
I am very discouraged.
Personally, I am trying to remain optimistic. The Spring Seller update is actually full of what I think are some real fantastic things: The new message system and the shopping cart or really cool. The FVF to include shipping is not my favorite thing by any means but I believe that the reaction to it is somewhat an, “Over-reaction” by sellers. It is not my intention to offend anyone, so no hate mail please:) I am a seller like many of you in the trenches doing this full time and trying to earn a living as a full time eBay seller. That said, items under 13 ounces are easy enough to digest… ad a couple bucks to the price of an item and offer free shipping. You will make a nickel from time to time and loose a nickel from time to time via first class. Heavier items…. Well, I sell Pianos and large machines and use eBay Freight Quote from time to time. I shipped a machine back east once that was almost $2,300 for rigging and freight. Would I take it in the shorts with 11% on that? Yes, of course. On items that are going to be heavier like dishes, speakers, washing machines, etc. I am planning on taking Griffs advice and roll most of it over into the price of the item and in such cases use the much loved and ingenious, “Make Offer” feature. With the offer, I will see where the buyer is and base my acceptance and counter offer by what my profit margin is. This new policy is not a death throw or nail in the coffin by any means and in fact, I take it as somewhat of a challenge. I believe that eBay is correct, that this is really what customers want. Just this morning I was shopping on eBay for a computer cable and found myself looking for one with free shipping, not even thinking about all this.
This does it. What a terrible, business decision on Ebay’s part … one too many. I’m done. I’ll find another way online with an online business model that makes sense … like Bonanzle, Amazon and my own website. We should be REWARDED not PENALIZED for our hard, hard work on THEIR behalf as well as ours. Over and out Ebay.
Then paypal takes the rest of the little profit you have left. This new fee structure will put the ones who have very slim margins out of business or force them to raise prices. Some people on eBay sell their items far cheaper than what they should anyways.
I wanted to mention something important here which in my opinion had a direct impact on the obsurd fee structure change eBay will be imposing on April 19th.
Firstly, I would not consider myself a professional business person; however, I am in no way an ameatur business person or stupid person for that matter. I understand that to grow a ecommerce retail business or to stay in a ecommerce retail business one must make a profit–(unless of course you are providing for a charity or something), must provide good prices, quality service and quality items with accurate descriptions etc., etc.
Now listen very caerefully. We know that this new move of increased fees on shipping by eBay is of course to fatten the pockets of eBay ceos and shareholders, and to increase traffic to the website and to get back some lost revenue that has been going to Amazon and other websites–(this is what the vp and president of eBay are saying along with their robotic employees). That is obvious.
BUT, I wanted to mention who else created this problem of increased fees and fees on shipping–THE SPOILED BUYERS and MORONIC SELLERS. How? Why? Here’s how and why. People that sign up to eBay as a buyer that have never purchased anything on the internet before and are looking to buy something they want or need, suddenly realize that they, too, in fact could also be on the other side of the fence as a seller or small business owner. So, here’s what happens. Having no clue what they are doing, they figure out what kind of product they want to sell or if they want to sell a lot of different products, ask questions, get a tax id number, make a lot of phone calls, get a wholesaler, get an eBay store subscription, figure out how to list something, figure out how shipping works, if they want to sell domestic or worldwide and poof! They have just created a small retail business on eBay. Here is the one thing I did not mention though–they have to create a price for the items they are selling and a cost structure for the shipping process.
So, what do they do? Being clueless, they look around and tell themselves the only way to make sales is to undercut everyone’s prices that are selling similar products, regardless if this means undercutting their own prices on the items and/or shipping. By doing this, they have created sales–(not profit)–for their business but their profit is now a horrid joke, maybe .25 to .50 cents per sale and that is being very generous. For sure, most were losing money by doing this and just having fun. So here is the mass end result of this wave of buyers turned into moronic sellers. Please listen carfully, what has now happened is that the buyer expects YOU and ME, the ones who have a profitable small business and who are charging accordingly, to now make our prices as cheap as what they are used to paying from these moronic sellers. End result? Spoiled buyers complaining to eBay about prices and on shipping charges–I have actually had buyers complain to me about charging them $3.17 shipping for a dice set, even though it is clearly listed, which costs me in the end about $2.50 to ship it, so I guess I am not allowed to make .67 cents profit on shipping even though I am taking the time to pack it and ship it to the customer on the SAME DAY OR NEXT DAY, they would now rather give that shipping profit to eBay LOL :-), no problem and thanks. A vast majority of people are cool about our shipping charges and never complain to me and came back to buy more and more because they liked how fast we shipped their items and the quality of those items and the vast selection of gaming supplies we offer, and compare that to the larger companies who would sometimes take forever to ship an item out because of the overwhelming amount of sales. When I shop on eBay, I, too, like buying from the small business because they ship my item to me fast and I don’t mind if they are charging me for shipping, I expect that and price is not everything when buying something
Anyways, eBay has listened to these spoiled buyers and now you have the present miserable situation real small businesses have encountered on eBay.
To make a long story short, to a certain extent, I don’t care what your price is as a competitor, if I cannot make a profit that is worth while then I have to figure something else out, but this does not mean that I will charge less or undercut you just to make .10 cents profit a sale? lol. That’s what a lot of ameatur sellers did and I would watch them and noticed a lot of them quit eBay and quit their lame business all together. Wonder why? They got sick of it of course because they were running around all day making no money, some were in fact losing money. But, the end result that was made in all of this is that they have spoiled the buyer and still are, and a lot of buyers now expect sellers like you and me to sell items that cheap and offer ridiculously low shipping rates. When we refuse to do so, they would complain to eBay.
And for those charging 300 dollars to ship an iphone are another breed of “tards” who caused this problem. But, the good people and small businesses on ebay will now be affected by this, and now we are the ones that are forced to change.
Plus, I noticed some of these teen-age idiots copying and pasting my description into their selling ad and, to boot, they would undercut my price to add injury to insult, and I would complain to eBay about it and they would do nothing. All my descriptions and pictures are genuine or are from the manufacture which I have permission from, and people would steal the descriptions and sometimes the photo and I had to police this nonsense myself by aimlessly finding the culprits and telling eBay which did nothting about it. I had to put my store name in the picture but my description would still be stolen from time to time.
Of course, I will now be increasing my prices on eBay in order to stay in business, if I don’t, I will be running around all day making no money or very little. Now, does that sound familiar?
eBay is just like the government. They think that raising taxes (fees) is going to solve their problem. All that does is kill incentive to do anything more.
Well, you can’t get blood out of stone and I think you are going to see a mass exodus from eBay, or seller are just going to sell on free listing days, that way they will be one fee less, the listing fee……
Raising the FVF makes absolutely no sense to me. Why not get onto these sellers that charge big time for shipping. I received an item yesterday, the cost of the item was $11, I paid the $11 plus $$12.95 for the shipping. When the item came, the postage was $2.97!!!!!
I am going to report this seller to eBay, not that it will do any good, I have done this in the past, and they don’t follow up on their promise.
People keep calling and complaining to ebay about costs and service when you are not obligated to buy anything. Now, buyers will in fact be punished by this because good, honest sellers will increase their costs and mask the shipping cost in with the item cost at inflated prices. It’s wierd that people buy something then complain about the cost. You are in fact spoiled, I am sorry, You have the power to buy something or not buy it. If you don’t like the sellers shipping cost or total cost, then buy it somehwere else. No one is holding a gun to your head to buy anything. If you think the seller is charging too much, don’t buy it and shop with someone else. Also, I have news for you, the item you bought from this seller, you said you paid 11 dollars, well guess what, he/she most likely paid about 5 dollars for it, so why don’t you complain about that too. Sellers are in retail business to make profit provide the end user with a product, not do you a favor, if you don’t like the total cost, buy it somewhere else.
Also Angie, yes, they are following up on your phone calls, have you not heard of the new spring updat, what do you think all these posts are about, yes, they have listened to your phone calls. They are forcing sellers to offer low shipping or free shipping with a final value fee on total transaction. So now, the shipping cost will be much lower, item price will now be A LOT HIGHER. LOL. So, in the future, you can call eBay and tell them how inflated the item price is and how they are overcharging you for the item you are buying. LOL
Lisa I have say -you are awesome! I get very tired of all of the Ebay experts out here that make excuses for Ebay and why they do what they do. Some are saying don’t panic?????? I am a person who likes the truth – not shaken and not stirred!! I have the utmost respect for you and the way you are responding, and the offer of help! My friend Mel from LOL says you are so awesome, and you have earned my respect! Thank you most kindly
Thanks Carolyn, I appreciate you saying that! I am one of those people who wants to know the truth of the matter – good or bad- so I know what the options are and can figure out how to work with it.
At least if you know what the deal is, you can do something about it and make it work. I would like nothing more than for people to be profitable on eBay. I still think the concept of eBay (a place where anyone can sell products to buyers around the world) is an amazing one. Which is why I am looking at all the options for people to continue to be profitable and will be sharing them in my free teleseminar.
And I agree with you, I think it’s insulting the way some ‘eBay gurus’ are patronizing people and dismissing their concerns about these fees changes.
Why not just say “Yes, this is going to be a problem for many people. And here are some suggestions that I have which might help your business.”
Don’t insult people’s intelligence by trying to give them a happy pill! Be real and do something helpful!
Or ever worse (like some of the responses during the eBay Town Hall) tell sellers who have run the numbers and know their niche that they were overreacting.
We’re all adults here. We don’t need things to be sugar coated. I think most people just want the facts, good or bad. And some real options on how to problem solve a solution.
Thanks Lisa for your honesty and support. eBay should hire you to teach them on how to run their company the right way.
On another newsletter, it is being said that Ebay is doing this to weed out the Sellers who start an item for .99 and charge excessive shipping (ex-$22.00).
My suggestion to Ebay, is have one of their programmers create a program –like perhaps a crystal report that can pull the .99 listing with a number greater than $20.00 shipping (for example) and have staff review them. I understand the need to weed out the undesirable but don’t punish everyone for the behavior of bad sellers. If you have 5 children –one misbehaves – do you punish all five – or do you punish the one who misbehaved? Some like Ebay would punish all – it is called abuse!
Ebay makes everything a lot like Shakespeare’s play – Much Ado about nothing!!! I also keep in mind that “Everything that looks good, ain’t”! I for one do not appreciate EBay’s tactics of making you think you getting something special but in realty you are getting scammed. It is an insult to ones intelligence. Speak plainly –do not beat around the bush. EBay’s representatives (if you can talk to one in this lifetime) have no clue as to how to answer any questions regarding their new policies….Nice customer Service….
I just replied to your other post and then read this one – and you said here exactly what my thoughts are!
As to why eBay is making this change – of course we can only all speculate, but I will say this – coming from the software world, I agree with what you outlined in terms of a software program that deals with (or is a checks and balances for) shipping that is way out of alignment with item cost is a COMPLETELY doable program.
Fee avoidance is a big issue, and is wrong, but it should be dealt with through technology, not fees.
Also, charging sellers a FEE as an incentive to offer free shipping? If you want to give someone an incentive, you GIVE them something – like a rebate. You don’t charge a FEE on an expense.
Granted it’s not a 100% perfect solution – people who are unable to add shipping in to the item cost and therefore wouldn’t be eligible for a rebate would be left out. But at least they wouldn’t have money being taken OUT of their pockets.
Or even better – just leave sellers to set their own shipping policies and let the BUYERS decide who to buy from.
I think eBay is trying to use “Free Shipping” as a hook to bring in more buyers. “Buyers love free shipping. And 60% of eBay sellers offer free shipping.” Would make for a great marketing campaign wouldn’t it?
But today’s consumers (who in many cases are overindulged and spoiled and want something for nothing) need to get a real.
There is a HARD COST for goods. Things cost money to make and sell. People who sell products need to be able to earn a LIVING.
And shipping is NOT free!!! I’m not saying that using free shipping promos when you can are a bad thing. I think free shipping promos are a great way to bring in traffic and new customers. The retail statistics show that. It’s a great way to get buyers excited. It’s a great way to do something SPECIAL for your customers. And that’s the way it should be used.
Sure, if you can work it with your model and offer free shipping all the time (and it works) then do it!
But retail is not a one size fits all business. And mandating free shipping across the board is not even in the realm of reality when it comes to a retail model.
eBay should be bringing traffic in because you can find “IT” on eBay. Remember that ad? THAT is what made eBay great. And what is still great about eBay.
Sure, we can offer free shipping promotions. But let’s focus on eBay’s value proposition – and that is the GOODS that people can find in the eBay marketplace.
I think that this is going to backfire on eBay…I really hope so anyway. I sell a myriad of items of varying weights so this is going to be a huge increase at least half the time and possibly a wash half the time. In no way is it going to be a decrease for me as I already charge bare bones shipping on light items.
This will drive away the penny auction sellers who charge an arm and a leg for shipping to evade final value fees. But it is also going to drive away the sellers that you describe. The “lamp” sellers. I am going to have to find other venues to sell heavier items.
And since I will be selling less on eBay, I can probably close my store and take advantage of the free insertion fees for the first 50 items. My lightweight, inexpensive items can take a 1.5 percent hit, especially since I will make up for it in item price or handling.
I haven’t decided what to do yet…I have to figure out the eBay math and my head hurts. I’d rather do advanced trig.
I just can’t see sellers sucking it up this time.
Good luck to all,
Yes, what you described is exactly how this change will affect millions of sellers. That’s what makes it different than any other fee change to date. Because it impacts sellers at a PRODUCT level. Which means that you need to look at every single product in your product line, and determine what pricing approach is best.
And you have to test each item to see what works. A daunting process if you sell thousands of items.
And you’re right – people who sell heavy items can’t just automatically tack shipping into the product price. That is not the model buyers expect and that is not a model that works. The “free shipping perception” is a reality with buyers – but so is competitive unit pricing.
There is a sweet spot in the pricing model of every product and if you add too much shipping to a per unit cost you will be way out of that sweet spot.
I think eBay is perfectly fine to let sellers know that their data supports that buyers like free shipping.
But charging a FVF on shipping in order to incentivize sellers to use free shipping? That is not increasing the seller’s bottom line. And it is not going to make buyers purchase from that seller. There is only one bottom line that is being increased here. The recipient of those FVF fees.
I admit that I was totally dumbfounded after I had read through the information on the site regarding eBay’s recent announcement regarding a FV fee being applied to shipping cost as well as sales price. It does not take much number crunching at all to see that their new model is going to have almost exactly the opposite effect from what they claim to be trying to do by implementing it. Simple math and logic are all that you need to reveal the most basic and glaring errors in a flawed and poorly thought out policy.
Consider the following two sellers, seller 1 and seller 2, each with the same product that cost them $5 to obtain and selling for a final price of $15. Both have feedback ratings that qualify them for “top-rated” status so any discounts from that don’t matter. It also doesn’t matter whether they are both store subscribers or not, we’re assuming that they’re the same in all other respects except the following: Seller 1 is willing to ship her item for the amount charged by they post office in a flat rate box for $5.00 (I’m rounding off for easier calculations) Seller 2 also ships the item in a $5.00 flat rate box, but she charges a shipping and handling fee of $5.00 as well.
At the end of the day, both sellers have gotten a sale. Seller 1 has been paid $15 (item price) + $5 (shipping) = $20 received from the customer. Cost of the item was $5.00 and cost of shipping was $5.00, leaving a potential profit of $10 for Seller 1, before eBay takes their cut. I don’t know the exact amount of the fee eBay will charge for each possible category and it’s easier if I can just use rounded off numbers, so let’s say that eBay is going to charge a 10% final value fee, which is calculated on the total amount received in the sale for the item plus shipping and handling, if charged. For Seller 1 that’s 10% of $20, or $2.00, leaving Seller 1 with $10 potential profit – $2.00 eBay fees = $8.00 actual cash in her pocketbook at the end of her day.
Seller 2, on the other hand, is going to be getting $25.00 total from her customer, which is a total of $15 for the item + $10 for shipping, since Seller 2 adds a $5.00 handling charge. Seller 2’s item cost is still $5.00, and she is also being charged an actual cost of $5.00 for shipping, leaving her with a possible $15.00 in potential profit. Once again eBay takes their cut, and remember, I’m using 10% for the eBay fee amount for simplicity. Seller 2’s fees are therefore going to be 10% of $25.00 which is $2.50, leaving her with $15.00 potential profit – $2.50 eBay fees = $12.50 actual cash money when Seller 2 ends her day.
Which of these two sellers has more money after the sale? Obviously, Seller 2 is making out like a bandit, compared to poor old Seller 1.
So, what I want to know is, how, exactly, is this policy supposed to be providing any sellers with an incentive to charge lower shipping, or offer free shipping, which is what eBay says they hope to influence with this change? I just can’t see any instance where there would be an incentive to do that, although if the shipping cost is small, sellers might still choose to offer to ship items for free just as they do today. But otherwise, I expect the ultimate result is going to be that more sellers realize that charging a handling fee increases their actual cash-in-pocket amount after the sale, and I expect that most of them will start (or at least will strongly consider) doing so. Thus, overall shipping costs for buyers will generally tend to increase, eBay will collect more fee money, and there won’t be any more free shipping listings in the future than there are today.
Assuming I keep selling on eBay, I simply will no longer be able to offer shipping at cost on any of my listings at all, once this policy is in place, because I would be losing money on the shipping charges in every single case if I do. There’s just no other way to make shipping pay for itself if someone else is going to be taking a cut of the money I have received from a customer for the shipping costs.
So, as I see it, this fee change cannot possibly do what eBay says they want to have it do (lower shipping costs for buyers or create more free shipping listings), since it does not offer any incentives at all to sellers for doing either of those two things. And, I can’t help but notice that eBay is getting a fee increase either way, but really, I just hope that someone at eBay will wake up and see the flawed logic in this policy before it gets implemented and gets it postponed indefinitely instead.
eBay has already been charging fees on shipping through PayPal. I ship international and PayPal charges their fee on the total amount my buyer pays. They have gotten away with it at PayPal so they are simply incorporating that practice in the FVF.
Yes, exactly. So now sellers are being charged once by eBay for the total order amount and once by PayPal. And with PayPal being the preferred provider for eBay payments, it sure looks like a payment monopoly.
I’m certainly not a lawyer, but I question how eBay can charge fees on a service that it doesn’t provide. If I list shipping costs as a separate line item, those costs are between my customer and me. If it costs me $10 to ship to New York and I bill my customer $10 and they are willing to pay $10, then eBay should not be taking a percentage of what it costs me to ship an item.
From a business standpoint, that is not their pie to eat. And as a seller, I should not be forced to raise my item prices, so that eBay can have a piece of my shipping pie. Now I will say that if eBay wants to raise insertion fees or commissions on the item price for the service they provide, then yes, I believe that is their right to do so. (Not that anyone would like it.) My issue is with charging fees on an expense. And let me just say, this applies to any of the marketplaces. It’s the same thing.
Amazon does charge fees on the total order, but it’s a completely different model.
P.S. I might add — not only does the PayPal fee apply to shipping, if it is an international sale the fee is upped from .029 + .30 to .039 + .30 on the entire amount received from the buyer.
I have been reading this blog and many others and I am getting tired of listening to everyone spend all their time complaining and not coming up with ideas of how we are going to make these new changes work for us!
I have sold antiques and collectibles here since 1998 and made a living, going through all the changes. I learned to stop wasting my time complaining (after the first day) of all these changes and to start thinking positively about how am I going to make these changes work for me.
I sell one type of new item with my collectibles and after the last change of no duplicate listings I doubled my sales on my jewelers loupes.
So how are we going use this to our advantage to make more money?
Maybe like putting statements in our ads that I charge actual shipping not free shipping based on the highest destination…..like other free shipping listings…
I list most of mine at the top price I would like to make on the item with make offers. So now if I choose to make them free shipping I can base what I will accept for the item including the actual shipping. EBay tells me that free shipping attracts buyers so now my sales should go up. Before I did not do free shipping on these items because than eBay got FVFs on them………..but now they do anyway so I will………..but just take higher offers……no money lost.
My jewelers loupes already had free shipping and built into the price listed at $12……………one of the highest priced one listed on eBay…and sell them like hot cakes and make a nice easy quick profit because I offered confidence, service, great feedback, helpful ads..etc.
And with the new lower fees I am going to make more on the now.
So how are we going to turn these latest changes to our advantage???
Believe me if we work at it we will come out ahead!
Thanks I will get off my soap box now.
I agree with you that ultimately, what’s really important is that each person needs to decide:
a) If they want to keep selling on eBay
b) If it will remain profitable for them as is
c) If it will not be profitable, look at what strategies might work and test them
d) Based on their tests make a decision to continue/discontinue certain products or expand to another channel
Because what really matters for a small business owner (especially one who depends on their income) is figuring out run profitably and thrive
That being said – I do think that people often need to first express their frustration before they roll up their sleeves and dig in to fix the problem. For example, I’ve looked at probably 120+ eBay businesses this week. Some models are profitable and will become more so. Others will need a few minor tweaks to pricing and positioning to get in a good place, and many will need to do quite a bit of rework and rethinking their strategies in order to stay profitable. It’s the 3rd group who is experiencing the most frustration. (Which makes sense.)
Granted there are some blogs filled with chronic complainers. (Not this blog!) And there are other blogs who solicit input from people and turn around an talk down to them and tell them they are overreacting. (Which is not right either.) And you absolutely have to have a positive, proactive, mindset as I talk about in my Mindset Entrepreneur audio.
I think people really want straight talk and to focus on solutions. But there are times when you just need to vent your frustrations and feel like someone is listening and cares. I’ve read all 100 + posts that have been written here, and that’s what I hope I am doing for people.
Next, it’s time to regroup and look at solutions. Which is why I’m offering a FREE teleseminar on March 30th. To present some strategies that people can test and work with to remain profitable on eBay and in other channels as well. You can register for the teleseminar here. And please share the link with anyone else you think might need some help with this! It won’t be “Rah-Rah” or “bashing” – just straight talk, and straight strategies for running a profitable online business.
All words of wisdom, Lisa & I appreciate them but testing will not work in my niche. Vintage items & collectibles are most often one time sales so this will be impossible to access.
I sell a lot of vintage dolls and doll clothing. The doll clothing I could continue to sell on eBay with not much of a problem, but not the dolls. I don’t like the idea of separating them because I can often make multiple sales to one customer.
Then another problem would be the combining of shipping. I can’t create rules with the huge weight variances that I have.
I really hate to say it, but I am leaning on shutting my store. I’ve been on eBay since 1998. It used to be fun.
Thanks for all your hard work on this blog. I’m going to come back and peruse your other posts.
I totally get where you’re coming from. Combined shipping rules would be nearly impossible for you to set with the products you sell. I’m curious, if you close your store, will you still continue to list on eBay at auction? Or are you thinking about moving to another marketplace? Or looking for something completely different to do?
I will probably continue to list some items on eBay but much less. I am thinking about trying Amazon. And I am always looking for other things to do. I dunno. Still trying to wrap my head around this. Haven’t made any firm decisions yet.
Hi Lois. I am happy that you have found a profitable niche that will work with the upcoming eBay business model. I think that’s great. However…
Many of us are not in the same boat (I think you are probably in the minority) and to tell us that we are annoying you by speaking our mind does not help.
I’m all for rethinking my strategy, especially since I am being forced to, but that strategy will likely include much less eBay because it just isn’t practical to continue doing business there. There isn’t a way to make it work unless you want to disclose your source for dirt cheap, featherweight jeweler loupes so that I can use it too.
I believe that eBay will in the end lose a lot of business. That’s not a gripe. I think it will be fact.
Good luck to you always,
I think that Meg Whitman saw the writing on the wall and didn’t want to be part of it….might be wrong, plus she wanted to throw her hat into the political ring, not that it did her much good…..but things seem to go down hill once she left, maybe she was the stabilizing factor that kept these idiots on the semi straight and narrow….jmo
Amen to that, Angie!!
Since Meg left and the greedy men took over it has been nothing but a feebay!
My best seller right now is offered at $9.99 with free shipping, after my expenses to sell, I make a whopping $0.24 on each sale. If I priced higher, I would be higher than my competitors pricing and not sell at all. If I have to find a way to free ship everything, with sellers (esp. China sellers) selling the same merchandise I get at wholesale pricing, and they sell it at the same or lower price I can get if for, I am finding it difficult to sell anything and make money. This new fee deal is really bothering me, like others, because they are punishing everyone for what a few too many are doing, fee avoidance.
If I stumble on a listing that has excessive shipping, I turn them in. I have turned in people for copyright infringement, to no avail. Even contacted the copyright holders, to no avail. So, when do the people doing the right thing get rewarded and not punished as a whole with those who are doing things in a questionable manner?
Have you looked into finding higher priced items in your niche? Or considered a different niche? What are you selling?
Ebay did not make enough billions last year from sellers so they have to take even more! I have been selling on Ebay for 13 years and I can tell you for sure Ebay has never cared about it’s sellers at all. You can be sure anything they do on Ebay that looks like they are helping sellers is only helping Ebay’s pocket. How is it possible to charge first, the most expensive FVF’s on the Internet but then say they are charging on shipping costs also! I believe there are laws against this! My prices over the last several years have been cut as far as they can go. I can’t give anymore discounts, free shipping, lower costs or free merchandise without closing up shop! I think it’s almost time to ditch Ebay and move on to better websites that appreciate their sellers.
I can tell with some reasonable degree of certainty that based on our sales todate and our current mix of products our fees will increase on average about 40%. This is outrageous. There is no way a seller can increase product cost to a buyer by 40% and offer “shipping included”. As you appropriately stated there is no free shipping. Prices on eBay are going to rise to the point that buyers will leave the platform. This is going to backfire on eBay in a way they cannot even imagine.
I just replied to your other post! It’s back on one of the first pages, so I’ll repost it here. What you are seeing – a 40% increase in fees due to your current product mix is what I am seeing in 85% of the businesses I’ve looked at this week. In fact in the survey I put out, 87% of respondents said that all or part of the products they sell would experience a fee increase (whether the shipping was priced as a separate line item or folded in with the item price).
Even with the reduction in FVFs and a TRS discount, most of my students/clients are seeing an increase in fees on at least half or most of their product line. This doesn’t benefit the customer. This doesn’t benefit sellers. There is one party that benefits and that is the recipient of the increased fees.
The other thing about folding the shipping charge into the item price – and doing it as a default practice across the board – is that item costs on eBay will rise dramatically for millions of products. And all of a sudden buyers are going to see dramatic increases in prices. And I can just see it now – the next wave of anti-eBay seller sentiment will be “Sellers are trying to hide the shipping and handling costs in the item price.” Buyers will not stop and think this through.
If you sell a heavy item, and it costs $60 to ship the item. And you charge the buyer $60 to ship the item. And they know it costs $60 to ship it. It is a transparent charge to the customer. At least they know what they are paying for. But if you fold $60 into a $40 item and offer “Free Shipping” – there is no way that buyer perception will see that as a deal or free shipping.
Free shipping was meant to be a promotional tool. It was meant to be used under the right circumstances. It was not meant to be a one-sized fits all model for all products sold online. And it certainly does not fit the business model of every single small business owner on eBay. If you sell light weight things – it does work. And it can work very well.
But for heavier items, small sellers on eBay don’t enjoy the big shipping discounts that the Diamonds get. In most cases they are working on a lower volumes of sales. Which means that in order to be profitable, you have to have a reasonable margin. People want to make a honest amount for an honest day’s work. And our country needs small businesses to thrive. The fiber of our economy is built on small businesses.
BTW, I haven’t posted it yet on my blog, but I am hosting a free teleseminar on March 30th to look at some different strategies for various business models in order to help people remain profitable in their online business. You can register at https://lisasuttora.com/ssr Please share this with anyone you think might find it helpful.
And below is my reply to your earlier post!
You make a really good point. When you add in the cost of shipping to the item, there is no opportunity to combine shipping for you products, resulting in buyers paying a higher price. This certainly does not serve the customer or “make for a better customer experience” as eBay is fond of saying.
And you’re right – eBay is not Amazon and it had a really good thing going when it was focused on being eBay! I was looking at a Channel Advisor webinar today and they underlined the fact that eBay is still not growing at the pace of ecommerce. Amazon has blasted past the growth of ecommerce. Even after a few years of changes designed to increase sales, eBay is losing market share. eBay was a GREAT community and still could be a top marketplace today, if they stopped trying to be Amazon.
I think when all is said and done, Amazon fees are still higher. But it is so much easier to list and sell on Amazon. And I will gladly pay higher fees to them because they handle the customer service, it’s easy to sell there, their customers spend more money and shop more frequently – especially the prime customers.
On that note, I don’t think anyone would mind paying more fees to eBay if it were simpler to sell and they were bringing the buyers in, in droves. It’s paying more fees on fewer sales and as you said – not selling on a level playing field that is a big part of the problem.
I meant to ask you – given that you are reasonably certain that you’re looking at a 40% increase in fees, what are your initial thoughts about those products? Are you going to test out the higher price points? Move to a different marketplace? Try and recoup the fees with higher profits on your other products? All of these are options of course – we can do some brainstorming here.
Unfortunately with the changes to the Ebay fee structure I will be going to my own web site (under construction) & Etsy for my homemade listings: countrybluequilts. (http://www.etsy.com/shop/countrybluequilts?ref=pr_shop),
I just cant afford the increase in fees.
If we raise the item price to include the shipping expense it also pushes us into the next Insertion Fee tier, increasing eBay’s bottom line again, whether the item sells or not.
I sell a niche item that costs me $2.15 to make. I start bidding at $5 with $2.55 shipping. If an item sells for $5 I really do not make anything at all that would keep me relisting items because basicaly I would be wasting my time, my items average about $10 a sale and I offer free shipping on orders over $40. I dont use a website because I can make a lot more on ebay. I usually list about 180 items at a time for 7 days and have had great results. Recently I have tried to find other items to sell but the problem is everytime I find an item to sell I find some seller selling the same thing at such a low price that they are making only pennies on the sale. Some of these sellers are even selling them using fixed price and are selling large amounts of product but not making any money. This ruins everything for other sellers because the customer is going to buy from the one with the cheapest price. The best items to sell on eBay are rare or niche items. Forget about trying to sell items you get from a supplier because all the customers come to eBay for 2 things. Either they want an item for a really low price or they want a rare item or a niche item. The buyers who want the rare items or niche items are more than willing to pay what it takes to get that item. Amazon is great for regular items because their customers will pay the higher price. I have had great success on Amazon selling the same items that are selling on ebay for way less.
It is overdue that a complete and total review of John Donohoe’s tenure as ebay’s C.E.O.
The first thing that John and his staff fail to remember is this: The sellers on ebay pay their bills and (used to) make ebay profits, not the buyers. You captured in one paragraph the root of the problem when you pointed out that ebay “buyers” want “free” shipping. You used the example of $25.00 lamp with $25.00 shipping as an excellent example. Thsi example also shows a problem that has emerged is the entitlement attitude among buyers that it should only cost $25.00 and the seller eats the cost for shipping. This entitlement mentality was fostered by the major change in ebay’s feedback system and poisoned the entire atmosphere. Two years ago when it was announced, I sent an email to our ebay account manager, Christine O’Hearn, detailing many possible consequences such as other sellers ganging up on each other and that the star system would be used against them. And in fact, that has happened to us. When we provided proof of this attempted sabotage, the folks at “trust and safety” failed to take any action.
And that’s just one problem. There are so many others, but it boils down to this: in so many ways, ebay is attempting to tell sellers how to run their businesses.
Put it another way, when ever we complain about a problem to ebay (and that is when you can actually talk to a human), we get told that the customer is always right. One night I got slightly annoyed with the “customer representative” who stated this to me and I pointed out to him what I stated earlier, that is we are ebay customers, not the buyers, we pay ebay’s fees., not the buyer. So if the customer is always right, why are we sellers all being told we are wrong?
This is the root problem is John Donohoe. In his time as CEO, he has attempted to intitute some sort of utopia on a website that is estentially a web version of a classified ad section of an average newspaper. It is not a platform for social engineering. It is no surprise that there is a correlation between John’s tenure and the decline of ebay.
Moreover, while John can be dismissed either as an underperfoming CEO with a misguided philosphy (and this new fee structure is just the latest example) or some kook with a heavy dose of meglomania, what concerns me is a board of directors who look at his record and continue to employ him.
The analogy I used to compare John’s record at ebay is to imagine a coach in the NFL that inherits a team whose previous coach won the Super Bowl, and the next year win nine or ten game, then the year after that, four games, then two games the year after that, then it improves to a 3 win season (and it is then cheered as some kind of greatness).
In short, John is mediocre and the ebay Board of Directors should be embarassed and it is overdue for the stockholders to react.
As a consequence to this attitude from ebay, so many of us are leaving. Many of us shall no longer pay tribute to a petty tyrant and a down and going website.
The buyers love free shipping, and they also love free products. All they have to do is open a dreaded Buyer Protection Case and Ebay refunds their total cost to them without much effort on the buyers part, so now the seller is out the product and the money and gets a ding on their seller record. To me, this is getting insane.
Here are the final value fees for Overstock.com:
Closing fees are the fees we charge at the time a listing closes and are based on the closing price of the listing. Closing fees are only charged for listings that close with a successful bid or purchase. Overstock.com Auctions does not charge closing fees for real estate auctions.
Auction Closing Feess
Closing Amount Fee Percentage
Item Not Sold No Fee
$0.01 – $25.00 3%
$25.01 – $1,000 3% of the initial $25.00 ($0.75), plus 2% of the remaining closing price balance ($25.01 – $1,000.00).
$1,000.01 and up 3% of the initial $25.00 ($0.75), plus 2% of the next $25.01 – $1,000.00, plus 1% of the remaining closing price balance ($1,000.01 and up).
An example of how Auction closing fees are calculated: If you sell an item for $2,000, your closing fee will be $30.25. This is calculated as follows: $0.75 (.03 times $25.00) plus $19.50 (.02 times $975.00) plus $10.00 (.01 times $1000) for a total of $30.25.
Fixed Price Closing Fees
Closing Amount Fee Percentage
Item Not Sold No Fee
$0.01 – $50.00 5%
$50.01 – $1,000 5% of the initial $50.00 ($2.50), plus 3% of the remaining closing price balance ($50.01 – $1,000.00).
$1,000.01 and up 5% of the initial $50.00 ($2.50), plus 3% of the next $50.01 – $1,000.00 ($28.50), plus 1% of the remaining closing price balance ($1,000.01 and up).
An example of how Fixed Price closing fees are calculated: If you sell an item for $2,000, your closing fee will be $41.00. This is calculated as follows: $2.50 (.05 times $50.00) plus $28.50 (.03 times $950.00) plus $10.00 (.01 times $1000) for a total of $41.00.
Thanks for posting the info on Overstock and their fee structure! This is very helpful information for people! I think Overstock is one of the most overlooked marketplaces for 3rd party sellers. It’s certainly worth people considering and testing to broaden their reach.
How are you finding the traffic and sales to be at Overstock?
Hi Dan. I’d like to know more about your experience with selling at overstock…is it fairly easy? I think I already have an account there that I never used and forgot about. I think I will test it out. Thanks,
HI Lisa – Thanks for all the great info. I have a comment that I haven’t seen yet about international buyers. I had an item that I had listed for $15.99 plus $5.00 shipping that I changed to $20.99 with free shipping. An international buyer comes along and pays the $20.99 plus almost $13 in international shipping. So they are really getting whacked. I fail to see how raising our prices will make us more competitive with foreign buyers or any buyers for that matter. Overall, I am really dumbfounded by their nonsensical logic. Ebay wants to raise our costs to encourage us to lower costs to our customers. Huh? And they win whether we go to free shipping or not. And I had to laugh at the rational that PayPal and Half.com already do it. Do they realize that they own both companies? Maybe not.
Lisa….At a time when prices are soring, and Ebay tells us that they are trying to keep costs down, they pull something so stupid. For those of us using first class, which is weight related, we are only charging the minum shipping on our items. Now we will have to figure another 9% into the shipping costs to cover this. To boot, I had a call from Ebay promoters the other day, anting us to use auction style auctions, with a Buy It Now, starting at 99 cents or less. For most of us, at this rate, and with the fees, we could not cover the cost of the item, and all the fees. We would be broke quickly.
The other thing I would like to say, is I charge no packing fees, only shipping and the price of the item. I still have to pay for the printer costs, paper and label materials, and the shipping materials. The shipping costs get paid, through PayPal directly to the goverment that runs the Post Office. It is NOT RIGHT for Ebay to add fees to something that is not even my income. Shipping is to pay the cost of shipping, NOT to make Ebay money.
As I see this eBay started out as a great venue where Buyers and Sellers could get together under the umbrella of the Republic with the watchdogs, the Jedi, who would right all wrongs keeping the force of justice in balance. Overtime, the evil Sith Lord, Donahoe with his apprentices have taken over the Republic, silencing the Jedi and enslaved the Republic. BUT, all is not lost!
What both the Buyers and Sellers needs is a voice, a spokesperson that can get the word out into the vast Republic of what is going on and tell the folks of this great injustice. We have all complained in the past, but never have had a way to make or voices heard.
The only media personality, who can get the word out to the folks and can call Donahoe on the carpet to answer this outrage, is Bill O’Reilly with Fox News.
There are so many horrible things to cover right now in the world — but this affects the folks and he is a champion of the working folks of this country and that must be the slant of your email. KEEP is short, but clear. I think Bill will only be interested if this is a clear injustice to both the buyers and sellers and hurts middleclass folks trying to make ends meet. We are just trying to put bread on the table in a terrible economy. Many folks have had to come out of retirement, work second jobs or have started to sell online to make it from paycheck to paycheck. Having eBay now TAX us on an expense that we can’t control will interest him (I hope). If he shows Donahoe as a Pinhead or gets anyone from eBay to respond, we have our voice – the stockholders will take notice. Not only is Donahoe losing money, but getting them noticed as being against the folks, charging unfair fees and mandating commerce, in short they are a monopoly.
How does this affect the Buyer?
1. Many middleclass folks buy on the eBay and have to wait until Payday to make payment. I never minded this and work with my buyers and have had very few NPB. EBay has done away with the NBP (should be a cost savings for them) and if you don’t pay for the baby doll for granddaughter that you have looked all over for and had to save up for weeks to get, right way – expect it to be snatched right out of your cart by another buyer. (I don’t know how this will work with auctions). They already did away with checks and money orders (some middleclass and lower class folks do not have checking accounts).
2. Prices will increase; the shipping costs will have to be passed on to them in some method. So now the extra plates you need for Susie’s graduation party to make it special for your girl will either not be listed on eBay at a good price with reasonable shipping from a caring seller or they will be at a price that is not affordable from a place like replacements or china finders. Unique items will disappear – those discontinued plates will be trashed, not resold (sounds like cash for clunkers again – oh don’t get me started on how the lower and middleclass can’t afford a new or reasonable used car).
We need to take action. Step One:
Daily, email Bill at: email@example.com. Put in your title the same thing every day (until he responses on the air)
Help us Obi Wan O’Reilly – You are our only hope.
This may get the attention of his staff going through the 1000’s emails daily. If 100’s come in with the same title from 100’s of different folks, he may weigh in. If he does, I think we can expect some change for both buyer and seller. We may have to keep this up until the world events subside. Again, don’t rant, just tell him how this will really hurt your small business and your family. How it is unfair to tax what you can’t control. How you have worked so hard to make ends meet and now you will be underwater again.
Regardless if you like Bill or not (this isn’t a political thing here) – he is a fair minded guy for the folks and is involved in many charities. Can you think of anyone else with his voice in the media? I can’t! This is his purview.
I have a few more steps to suggest, but I have to get to listing.
We need to stop talking and take action.
Bill is on Fox News at 8:00 PM and 11:00 PM – watch and see if we have a champion.
Okay — here is Number Two:
Oh – if eBay calls to “tell you about the Spring Changes” Be polite – say – no, you don’t wish to speak with them, tell them to have a nice day – hang up. Again, uniformity in response will trouble them. Resist the urge to scream at them. If 100 or 200 people say the same thing, do the same thing – WE HAVE POWER.
If all sellers would boycott for 5 days in protest to the fees – just don’t list items for 5 days – maybe Ebay would get the idea. Time for a tea party revolt!
Unfortunately sellers have tried boycotts before the only thing that happened was that sellers who didn’t list lost money.
If every seller on eBay stopped listing, it would likely have a different outcome, but it would require total participation.
I’m a relatively new eBay seller. In the learning process have operated under razor thin margins but through experience have improved my bottom line has gotten better over time. Like many of those that have posted here, I’m struggling to see how I can keep my momentum with the new fee structure. In reading these posts, it is mentioned by several (and I’ve heard it from others outside this blog) that eBay is on a premeditated course to drive the small seller out. What am I missing? If they drive me (and others like me) out of business, aren’t they driving themselves out as well?
Ebay is currently charging me over 13% of the total transaction including final value fee, insertion fee, and paypal fee.
If ebay can calculate the cost of shipping by weight, dimension, etc.; wouldn’t it be a fairly trivial task for ebay to detect a seller shipping something for $200 when it should only be $20?
Why should ebay deduct a fee from the cost of shipping? It only drives my cost of shipping up!
You know what 13% of the total transaction equates to?
Most sellers only have a 30% profit margin.
If ebay is getting 13% that means they are getting almost 1/2 the profit of everything I sell!
And ebay wants to now charge me a fee for the cost of shipping!?
Does it make sense that ebay should take 1/2 of all the profits and want to charge a 13% fee on the total cost of shipping?
Time to start considering alternatives…
Ebay’s announcement for charging final value fees on shipping costs has gotten me very concerned. If they do this, we will have to charge even more for shipping to make up for the fees they will be charging us on the cost. It is funny how they tried to make it sound like they are helping the seller by lowering the percentage they charge on final value fees, which amounts to 1% difference, but now are going to charge that 11% percent to our shipping costs that we pay the shipper. How does that help the seller or the buyer? Now shipping rates will be even more expensive if we want to keep from going broke. We are being charged for the price with the shipping and then for the payment at the end by paypal, which is owned by the same company. Hmm. Seems like it will only be helping ebay make even more money off us. I am sick about it.
i think ebay is doing this because i have seen some sellers sell an item for .99 cents and then charge $39.95 for shipping. ebay only got a fee on the .99 cents while the seller got $39.95 for something that costs $4 to ship. Once again it is the few bad apples that have spoiled things for everyone.
I am all for sellers boycotting for 5-7 days in protest to the fees!! A message needs to be sent to Ebay and maybe then they would get it. Time to strike!
If every seller on eBay stopped listing, this would probably have a different outcome!!
That sounds a great idea Debbie, the only problem though is you will get a few which will take advantage of everyone else not being there for competition lol
Your so right Lisa, glad you never drank the ebay kool aid. It’s really all about their greed.
Thanks for this update. I am hoping consumers aren’t so silly as to think they will get something for nothing. It will only be a perception that shipping is free, of course companies will build the shipping cost into their item. Australia post is putting their postage costs up at the end of the month so this is really bad timing.
Thanks Lisa for the blog. As a ebay seller, I am really upset with this new fee on shipping charges. We, ebay sellers feel helpless and your blogs help us to voice our concern.
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
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…
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?
I think ebay bows to the buyers……….but should remember, without sellers, there will be no buyers……
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.
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.) 😉
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.
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.
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: firstname.lastname@example.org. 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.
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”.
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!
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!!!
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.
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.
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.
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?
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.
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.
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
-$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?
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?
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!
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!
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
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?
I just saw this guide on eBay about Fees and thought WOW, eBay gets away with the horse and carriage!
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…………
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:
Wow thanks for that site Lisa….great look at all the sites…
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?
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.
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.
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
is it possible to have a NATIONAL “DON’T LIST A THING WEEK” against Ebay?
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!
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!!!
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.
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.
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!
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.
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.
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.
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.
Please check out my website so I can leave ebay.
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!
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.
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?
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.
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.
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.
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…
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.
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.
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.
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.
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?
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.
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.
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!
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.
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.
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. http://survey.ebay.com/survey/ebay/eby11056?list=3&source=ms280OaFoV
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”:)
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.
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.
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
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.
DOWN WITH EBAY FEES
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.
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.
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.
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.
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
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.
Hmm, well if ebay wants to get greedy, I think I’ll just stop paying my fees, well at least this new FVF on shipping anyway. I don’t think they have any right to do this. Shipping cost has nothing to do with ebay, they shouldn’t even be able to touch that. eBay is already getting money from both the item’s price as well the money deposited through paypal. If they want to make more money, as every greedy company does, they should’ve just raised the FVF on the sale price a percent or too, not do something as intrusive as a whole new fee on shipping.
I hope ebay gets the clue that this is straight up bad business. Until they stop this terrible practice, people are simply going to leave ebay, hopefully leaving standing account balances with them.
Unfortunately eBay won’t be removing the fees on shipping. I had a meeting with eBay’s director of seller marketing and director of pricing – and talked with them at length about this. A lot of different factors went into the decision to implement fees on shipping. So this is the eBay model of the future.
For some people it’s working, for others it’s not. It all depends on what you sell. I go into this in detail in my 2-part teleseries “Tackling the eBay Shipping Fees… and Winning.”.
For many people it does call for reinventing their business. I wish I could tell you something else, 🙂 but that’s the truth! You can make it work though if you still want to stay on eBay.
….if you offer free shipping on combined orders and the customers pays for each item without combining them first and you send them a refund on the shipping of the second item you don’t get a refund on FVF.
The folks at eBay need to get themselves some guns and masks then come to my house, bust in the door and rob me proper
The issues you outline have a serious impact on your business. I did talk to eBay’s director of seller marketing and director of pricing about the combined shipping/refund issue as it relates to final value fees. And they did confirm that right now there is no solution, but they are working on a way to refund the final value fees when a customer is refunded for partial shipping.
It’s not a consolation I know – given that your bottom line is being impacted now. And I agree with what you said about the impact on the customer and what they pay. And as you stated (and I wrote in this blog post) – unless a company really does absorb the cost of shipping for the customer, there is no such thing as “free shipping.
I don’t understand this fee at all. Ebay is not packing the item, is not driving the item to the post office, and is not paying postage to ship the item. I can understand a fee for posting an item, but how does Ebay acquire shipping costs?
I don’t even print out a shipping label as I am perfectly capable of using a dark ink pen to write a legible address. With the fees on Ebay and the fee on using Paypal I am barely making any money at all.
I just spent 20 minutes yesterday talking to Ebay customer support about that Final Value Fee on Shipping. I got charged for selling some goods for last three days and when I notices that on my account activities I made a call.
I requested to get all the Final Value Fee on Shipping fees back to my account. It is not a good way to run business. Ebay is getting greedy.
I stopped selling a couple of years ago when they changed international shipping charges rules. It decreased my profit margin by 75%, as I would list on non-US sites, and ship from the US, requiring higher shipping charges. I could no longer charge for this. eBay lost a power-seller. This move will lose them more. :/
Since I am fairly new to eBay, it does not bother me that they take a cut on the postage…I just increase my postage.
What they REALLY need to do, since they are now taking fees from the postage, is REMOVE the stupid question asking if we as Seller’s charge reasonable fees for our shipping…
WHY would that matter if they are participating in any profit we may make above the standard shipping fees.
Yes, that’s true – there is a (relatively new) policy against saying anything in your eBay listings regarding eBay policies influencing changes in your business (pricing, shipping, payment methods etc.) The best option is to just stick to the facts of the product description. I do think that eBay needs to revise their “We’re just a venue.” statement. That has not been true for many years. It is their ‘house’ and they can run it the way they wish, but being upfront about it is the right thing for them to do!
I wonder if one reason for the decision was the number of bad sellers switching the item price and the shipping cost to avoid ebay final value fees. I saw this a lot and reported it to ebay whenever I did. For example, one seller was selling rare sealed blank cassette tape for a buy-it-now of $1.00 and shipping cost of $25.00 to ship one little cassette tape. I see many other violations as well to avoid ebay fees. I’ve been saying for years that sellers who get away with this sort of thing ultimately hurt everyone because ebay will raise fees. I have a feeling I’m one of very few from the old school who believe ebay members should keep house and weed out bad members. I still click on that little link that says “Report Item.” Everyone should… or should have I guess I should say. IMO if members were more involved in ebay we wouldn’t be paying such high fees and now final value fees for shipping. To be fair to members who haven’t been more involved in maintaining ebay there has always been poor upward communication to ebay and it has only gotten worse.
I had a decent part time job through ebay, selling motorcycle parts. My shipping was always higher than my parts obviously because my parts are heavy. Im out! This new fee kills me and I am making little profit and it makes no sense for me to sell any more unless I want to keep the shipping company and ebay in buisness. Thanks ebay for the memories; jackasses.
Is there an alternative to Ebay yet? These seller fees are still hurting me, they are clearing out too much money at the end of each auction, it seems rather pointless to sell on ebay for a profit anymore, hopefully if another fully functioning auction site is online, ebay will be a market for desperate sellers and made in china items.
And what about the sellers who do true auctions–$.99 to start. Then, weigh and measure each box–enter data into their shipping calculator—loose 3%+ to paypal, still end up owing more for postage (cause the calculator is seldom accurate) and not charge a handling fee? I’ve always prided myself on staying true to ebay’s original business model (i remember waiting for money orders and hand writing customs forms). I was never a fan of Buy It Now–and i’ve always charged actual postage. I’ve refunded when it was overpaid and ate it when it wasn’t enough. I pay for my own packing materials and treat that as i would any other variable expense. I’ve never passed it on to the buyer. Yes, I did all this to stand out among other sellers and increase my own worth on ebay–but along the way–it was sellers like me who truly created the “ebay experience”. No i didn’t help write the codes that enable the platform—i just did the grunt work—i was the honest, trust-worthy, hometown, folksy seller that ebay capitalized on and now extorts for every lousy penny they can squeeze.
I started to give up on ebay when the feedback system changed which allowed buyers to hold sellers hostage for partial refunds, clear violations that never work out in a sellers favor. It didn’t take buyers long to figure out that nothing bad could happen to them by simply sending an email saying i want money back or else. Ebay went from a shared community to a cold hearted, dog-eat-dog forum over night with that little change. I was amazed and overwhelmed at how buyers attitudes just changed instantly.
Had I known then what things would be now, i doubt I would have cared so much whatever happened to ebay. Silcon Valley streets are paved worth brillant and useless dot com computer codes. I and many others like me created ebay–not some ivy league geek. They forgot that and will in the next 10 years suffer for it. There already is an Amazon—no room for another and besides….amazon does it better. half dot com anybody???? that joke of an ebay site never caught on—but now—it’s the entire ebay experience.
Yes, I’ve always been an advocate of having an “eBay Classic” site and a new consumer goods site, so that the two models could be handled separately. I think an eBay Classic site using the original model and featuring the unique-one-of-a-kind products, in a marketplace filled with independent online sellers would be a big success!
And you’re right, Amazon has it’s model nailed down and they do it very well. The thing about Amazon is that they know who they are, and they’ve stuck to that vision for years in a quest to become the best at what they do. They know they can’t effectively be all things to all people (at least not in one marketplace).
If case anyone is wondering, you have to multiply 0.099 by the shipping cost to make up for the Shipping FVF (if you plan on the buyer sucking up the cost).
I do not do this as a seller, but I am toying with the idea of splitting the charges with my buyers. Such as I charge them: shipping cost PLUS .050 x shipping cost. So if the shipping is normally $10, then they pay $10.50 and I pay 49 cents.
i heard a lot of people saying that the real reason ebay started charging fees on shipping was because of the bad sellers who had put in small amount on the actual item and greater shipping fees to avoid paying final value fees. instead of charging for shipping fees, i personally think ebay should rather follow amazon model where they defines what the shipping costs would be based on the category of the item, size and many other factors. amazon model has been successful over the years.
I just sold my first item on ebay yesterday ! What a surprise when I saw that I was ‘Taxed’ on the shipping cost… what a racket. I suppose I don’t have to complain since I found a buyer in 3 days instead of waiting for an eventual buyer on a forum or a free selling site but still, that kind of crap reminded me Rogers (phone company) network access fees, the money was supposed to be used to clean antennas in winters… another racket to steal my dimes.
Thanks for this explanation. I took a break from eBay when they started enforcing the PayPal requirements but came back recently to buy. A few weeks ago I started to sell and I am AMAZED that they are now taking money from us based on a charge that doesn’t even involve them. This micromanaging of their sellers is really for the birds and it seems like there’s nothing we can do about it.
As you can see from the prices, if you are not a top rated seller the fees are the same to have it with free shipping or not. It was only to stop with people listing the auctions at ridiculously low prices and mark up the shipping price to curtail eBay fees.
If you are a top rated seller you are rewarded for providing free shipping. However I read an article that did a study on listing prices and it discovered that auction-style listings that did not have free shipping included in the price received higher bids. This was in turn, caused by customers understanding and seeing the price it costs to ship and in turn was more willing to bid a higher price.
I just wanted to add that tidbit :).
I don’t recall if the higher bids exceeded the 3.58% more in fees for listing with calculated shipping.
Thanks for our post on eBay charging fees on shipping. I was alarmed at my invoice this month at close to $80, knowing I hadn’t sold $800 worth and thinking, in the back of my mind, that final value fees were around 10%. Had been selling more in the range of $100 to $200 a month, and then not even consistently, and so the invoice fees didn’t ever phase me much. But I was shocked to see such a huge bill and then come to find out that they’re charging fees on shipping. I feel robbed! Love it how you put it that even with the IRS that shipping costs account as a business expense, with your analogy contrast between free shipping and cake for your child really bringing it home. There’s lots of things I enjoy about doing business on eBay, both as a consumer and a seller, but eBay sure has a way around legalities when it comes to creative profits for them. And their excuses for doing so always strike as unsubstantial as this one “buyers love free shipping!” They so don’t realize how, in the long run, they shoot themselves in the foot by creating a poor business atmosphere for the very folks that are keeping them in business. By the time I get an item ready for sale, photograph it, write it up, list it, package it and ship it, and then paying both the eBay and PayPal fees, sometimes I don’t hardly make a dime — and that’s if everything goes according to plan. All that time and effort, as well as the cost of the original item. No wonder they seem to want sellers to almost give things away for free, as they know they’ll still make money on the shipping costs. What a scam! Thanks for writing about this. I’m signing up for your blog now. Appreciate your insights.