This post is contributed by an eBay consignment seller who wishes to remain anonymous.
So you're one of the lucky sellers who has access to incredibly low cost merchandise - whether you are hitting the bins at GoodWill or are super influential at estate sales. Or maybe you volunteer at a thrift and get a discount or inside scoop about upcoming sales.
Whatever you sell, no matter how you buy it - have you noticed how cheaply merchandise can sell for over the past couple of years? High-end electronics, extremely desirable collectibles and similar still demand a good price. But clothing and accessories, the most popular items to source and sell on eBay, often go for insanely cheap prices. I've been a seller for close to 20 years and have watched the competition increase and prices go down. To boot, eBay has added features which show the buyer competing items - similar or identical to yours - which can easily sway a buyer to someone else's item.
That's great for buyers, but not so great for sellers. And while some of us maintain a stance that we will attempt to sell at deep discounts off retail, but in a win-win for seller and buyer but closer to, perhaps, consignment pricing, other sellers who can source items for a few dollars per pound think of it differently. For instance, if your net cost of a high-end dress is under $2, selling it for $15.99 is a 1000% profit, right? That's impressive. Until you think about a few things:
What is your time worth? How long does it take you to evaluate the item, inspect it, photograph it, measure and list it, store it, retrieve it and pack it up? How much does the label cost? We won't factor in driving to the post office as so many folks have doorstep pickup. How about eBay fees?
Let's look at our $15.99 example above and do some math.
15.99 sales price
-2.07 ebay/paypal fees (13%)
-.20 listing depending upon your store subscription
-2.00 purchase price
-2.00 income tax paid on April 15, depending on your bracket and how your expenses factored into your income
_______
9.72 is what you've really made on this item. Unless you offered free shipping. Yikes. Then you're down another 2.50 at least.
Considering that minimum wage is $10.10/hour in my state, you're making under minimum wage on that item, perhaps a little more if all the activities per item take you less than an hour when factored together.
While it's great to make ANY wage while being your own boss, wouldn't it be even greater if you made more? If you considered, rather than net profit on the piece, what the marketplace is willing to pay?
What if we all did that? What effect would that have on everyone's bottom line? Instead of trying to undersell the competition, what if all 20,000 of us on this site collectively took action to raise our collective bottom lines?
I can tell you personally, I have successfully maintained a higher price point and have had success with it. I feel by going for the win-win - the customer is happy with a great deal and quality item, and I'm happy with a significantly higher profit margin - you develop a better reputation than you do when you're giving away the farm. As a marketing director in my full-time job (eBay is an unavoidable addiction), I know that you diminish the value of your product and your brand when you give it away.
You may disagree with me, and that's certainly your right. But I don't even know you and I know your time is worth a lot more than you're getting if you're lowballing to beat the competition. So take a look at your costs and your time holistically, and consider the impact our community can have if we ask for what we're worth.
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