eBay to Launch Brand New Export Program in the US

eBay is launching a new export service called the eBay Global Shipping Program to facilitate cross border trade. The new service, which eBay has not yet announced, will launch in September and will be operated by Pitney Bowes.

With the Global Shipping Program, a seller can ship items to buyers in other countries with minimal concern over issues such as customs duty and taxes, shipping regulations and restrictions.

The Global Shipping Program will eventually become the default international shipping option, first for U.S.-based sellers, and later for all sellers. PayPal will be the mandatory payment method for listings offering eBay's Global Shipping service.

How It Works
Initially at least, U.S. sellers may choose to opt in to the Global Shipping Program, and they handle the domestic leg of the shipment for international orders. Sellers set the domestic shipping service and costs, including domestic handling charges.

Pitney Bowes, contracted by eBay, is responsible for the international portion of the shipment, which includes assessing costs, handling customs issues, providing insurance, and completing delivery to the buyer. Sellers opting in to the Global Shipping Program have no control over the shipping service or cost for the international leg of the shipment.

Overseas buyers will see the total cost of the domestic and international shipping components as a single amount. Buyers will also see the "import charge," set by Pitney Bowes, on the listing page for an item, based on the buyer's location. This quote is estimated on the View Item Page and guaranteed at checkout.

When an overseas buyer places an order, the U.S. seller ships the item to the domestic parcel processing facility specified by Pitney Bowes and operated by third-party logistics providers, which then forward the item to the buyer.

eBay will offer only a single Global Shipping Program service, called "International Priority Shipping." That's what buyers will see on the listing, and Pitney Bowes will select the shipping service for each order based on its own criteria.

Buyers and sellers will be able to track the international shipment of orders from the U.S. to the designated delivery address within My eBay.

Paying Tariffs and Duties during Checkout
Overseas buyers can be surprised by tariffs or duties when they receive international orders or may ask sellers to lie on customs forms to reduce such charges. With the new program, eBay displays the true, total cost of receiving international orders (calculated by Pitney Bowes). The buyer pays all costs associated with the shipment at checkout so that there are no surprise tariffs or duties when buyers receive their orders.

Opting In
Sellers will be presented with the option to join the Global Shipping Program in promotional emails and on various pages of the eBay U.S. site, including at sign-in and on their My eBay page. Once opted in, sellers need not opt out again. They can simply choose not to offer the Global Shipping option in listings.

Seller's Responsibility
The seller's responsibility for shipping remains the same as for any domestic shipment, and ends when the international shipping provider takes charge of the shipment.

Restrictions
The seller must be opted in to the Global Shipping Program, and the listed item location must be within the 50 United States. The buyer must be in a country to which the U.S. government allows the listed item to be shipped.

Payment for the order must be via PayPal. The total value of the order (including shipping but not import charge) cannot be more than $2,500 (or $1,600 U.S. dollars for buyers in Canada).

eBay prohibits certain types of items from the program, such as obscene materials, weapons, cosmetics and fine arts, to name a few. It also excludes quite a few categories, including Antiques, Art, many types of collectibles, and certain subcategories within Health & Beauty and Jewelry & Watches.

Over time, eBay may include more categories in the program.

Unanswered Questions
The financial model isn't transparent, but PayPal will transmit the item price and the domestic shipping charge to the seller, and PayPal will transmit the remaining balance to Pitney Bowes' PayPal account. Consolidating packages achieves lower shipping costs than individual eBay sellers could obtain on their own, and it's clear Pitney Bowes will charge buyers enough to cover the shipping, tax, insurance, duty and tariff costs and make a profit.

Cross border transactions are more profitable for eBay and PayPal, which is required on all Global Shipping Program shipments.

What sellers will be most concerned with is how eBay will handle feedback and Detailed Seller Ratings (DSRs) for shipping-related problems stemming from Global Shipping Program shipments, and how eBay will expect sellers to handle returns.