Ebay Raises Seller Fees
Posted: Thu Jan 31, 2008 4:07 am
In a case of unparalleled greed, Ebay has just raised its seller fees by an unheard of amount. I'm no longer selling there, having watched my profits get nickel and dimed to death by them over a five year period, but this latest takes the cake.
In case you were unaware, Ebay charges two separate fees, a listing fee, which is a flat dollar amount when you list an item, and a final value fee, which is a percentage of the final value amount if and when the item sells. When I started on ebay, the listing fee for inexpensive items like I sold was 25 cents and the final value fee 5%. Over the years, it became 40 cents and 5.25%. Listing fees for higher priced items are higher as well. In fairness to them, there is a sliding scale so that items that sell for over $25 have lower percentage fees for the amounts over $25.
Now, Ebay has "graciously" reduced the listing fee from 40 cents to 35 cents, but has increased the percentage fee to 8.75%. This means that if you sell an item for $10, you pay a whopping 12.25% in fees. Tough to make money that way.
A number of people have store listings on ebay, which are permanent fixed price listings for up to 30 days arranged under the seller's ID. The feees for them went up from 10 to 12% as well.
For big item sellers (things that sell for $100 and up), the increases won't be that much, but for smaller sellers, who have been Ebay's bread and butter over the years, this is going to hurt a lot.
One would think that with increased size, Ebay would be able to reduce its fees and still make money on a volume basis. They have gradually added features such as the availability of more pictures of items, but these really don't do a whole lot to help sell most things.
On the positive side, they are changing their feedback system to make it more difficult for a deadbeat buyer to flame a seller and have it mess up the seller's rating permanently.
Ebay is a perfect example of what happens in an effective monopoly system. They really have no competition, so they can pretty much charge anything they want because there are no effective alternatives out there for people. Would-be competitors have never been able to get the traffic volume to get substantial number of sellers despite extremely low fees. It would take someone with deep pockets willing to fund and heavily promote a competitor for a couple of years.
In case you were unaware, Ebay charges two separate fees, a listing fee, which is a flat dollar amount when you list an item, and a final value fee, which is a percentage of the final value amount if and when the item sells. When I started on ebay, the listing fee for inexpensive items like I sold was 25 cents and the final value fee 5%. Over the years, it became 40 cents and 5.25%. Listing fees for higher priced items are higher as well. In fairness to them, there is a sliding scale so that items that sell for over $25 have lower percentage fees for the amounts over $25.
Now, Ebay has "graciously" reduced the listing fee from 40 cents to 35 cents, but has increased the percentage fee to 8.75%. This means that if you sell an item for $10, you pay a whopping 12.25% in fees. Tough to make money that way.
A number of people have store listings on ebay, which are permanent fixed price listings for up to 30 days arranged under the seller's ID. The feees for them went up from 10 to 12% as well.
For big item sellers (things that sell for $100 and up), the increases won't be that much, but for smaller sellers, who have been Ebay's bread and butter over the years, this is going to hurt a lot.
One would think that with increased size, Ebay would be able to reduce its fees and still make money on a volume basis. They have gradually added features such as the availability of more pictures of items, but these really don't do a whole lot to help sell most things.
On the positive side, they are changing their feedback system to make it more difficult for a deadbeat buyer to flame a seller and have it mess up the seller's rating permanently.
Ebay is a perfect example of what happens in an effective monopoly system. They really have no competition, so they can pretty much charge anything they want because there are no effective alternatives out there for people. Would-be competitors have never been able to get the traffic volume to get substantial number of sellers despite extremely low fees. It would take someone with deep pockets willing to fund and heavily promote a competitor for a couple of years.