eBay has posted its Spring 2011 Seller Update. One of the controversial changes includes the way final value fees are calculated. According to the announcement:
"Starting July 6, to encourage and reward low-cost shipping, Final Value Fee rates for Fixed Price listings will be reduced and applied to the total amount of the sale —including shipping. This change applies to both eBay Standard fees and eBay Store subscription packages."
This announcement has some sellers in an uproar. But that is not unusual, every time eBay changes the fee schedule (or anything else for that matter), you will hear a ruckus on the eBay Community Boards and in your eBay groups. Let's all take a deep breath and look at this rationally and consider all of the changes as a whole.
I think the purpose behind this change is that eBay is trying to get a handle on those sellers who sell their item for .99 with $20 shipping. This is called circumventing fees and is an eBay policy violation. Sellers do it anyway. I actually find this amusing, as if these sellers think they are outsmarting the eBay system. If they are caught, they can be suspended. After years of trying to police this strategy, eBay is trying to collect fees from these unscrupulous sellers. Charging fees on the total amount of the sale, including shipping, may be the only way to do it.
Before you panic:
EXAMINE YOUR NUMBERS!
eBay has provided calculators here where you can plug in numbers and see how the fee changes will affect you. Sellers will receive 50 free auction listings a month which is a significant upfront savings. Sellers can add Buy it Now to 50 listings for free. Final value fees in some categories will be less.
Click here to read the entire update, view the new fee schedule, and run your numbers on the calculators. eBay has also set up a special discussion board for sellers to ask questions and chat with eBay staff. Click here to visit the Spring 2011 Update Special Discussion Board.
Some sellers have speculated that eBay is making these changes to "get rid of the small seller." I don't see this at all. I see eBay operating under the "long tail theory" which states that a larger share of the population rests within the "long tail" of probability distribution. A few may dominate, but the sum of all the smaller sellers is greater than the sum of the few that dominate. Small sellers are a huge part of eBay's seller base. Why would they want to get rid of them?
Keep in mind that eBay, like life, is constantly changing. eBay provides the world's largest online marketplace where we can sell our items and enjoy the freedom of running our own businesses and working from home. Being able to adapt to these types of changes is what makes sellers successful. Look at the facts, ignore the hype, and make your own decisions.
7 comments:
Hi Suzanne. The only thing I'm disappointed about is that I live in Hawaii and basically have only two ways to ship: First Class or Priority. Parcel Post and media mail takes 6 weeks to reach the continental US and can't be tracked when it's on a boat, so although it's a cheaper option, buyers don't always read the description and still get upset when their package takes long. And anything over 13 ounces are automatically more expensive if they don't fit in a flat rate box. It just feels like I'm being punished for providing the quickest and most efficient shipping options at cost to my buyers.
It makes one wonder if this isn't somehow illegal, double dipping on sales, Ebay fees, Paypal Fees, charging us for a Service (shipping) that we haven't any control over. 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….
Hi Suzanne, Let's not forget to mention that those free auction listings are for sellers who do not have eBay stores. And although I don't think that eBay is trying to get rid of the small sellers, it is the small seller that is going to be hurt the most. I agree with you and believe this is eBay's way of handling unscrupulous sellers. But no matter how you look at it, these changes will mean overall fee increases for most. I for one plan to relook at my product line and change it as necessary. eBay is still the place where the buyers are.
On another positive note, this change will help out those who choose to drop ship since their final fees will not include shipping.
I was a little taken aback at first by the change. Then I was looking for sneakers for my daughter and saw several auctions that were .99 and $200+ for shipping. I was floored and realized at that moment why this change was happening. Thanks Suzanne for always being the voice of reason!
Thanks for offering your perspective on the whole matter. I was a bit upset because I felt eBay was punishing the small seller. The "long tail" theory makes sense. Thanks for sharing.
I do not like being charged a fee on my shipping since pay pal also charges me a fee on the same shipping cost.
And if you have a store like I do there is no free first 50 listings. That is only for those who do not have a store.
I agree eBay and amazon are the only options for those of us who want to sell on the Internet that have the traffic we need. I still do not like being double charged on my fees.
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