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eBay Negotiated Postal Rates Disappoint Sellers

With new postage rates taking effect on Sunday, eBay set up a live-chat session on Wednesday to answer questions about the USPS negotiated shipping rates it would offer sellers through its online postage service. There were several key points to come out of the session of which sellers should be aware.

After reading eBay’s October announcement in which it said it was working with the Postal Service to negotiate rates, some sellers had hoped eBay would be able to use its leverage to negotiate more favorable discounts than it currently offers.

Instead, eBay revealed on Wednesday it would offer to most sellers the same Commercial Base discounts that the USPS makes available to all online-postage providers for many classes of mail.

For sellers who are members of its Top Rated Seller program or who send out 300 packages/month, eBay currently offers Commercial Plus rates, but the eBay Shipping Team representative was unable to provide details about whether those were the rates eBay would begin offering TRS sellers beginning on Sunday.

With the new rates just days away, a seller posting in Wednesday’s chat session was perturbed, saying he had a warehouse full of DVDs and had been unable to get an answer from eBay about the postage discounts it would offer to TRS sellers.

The seller offers free shipping in order to get TRS discounts and can’t price inventory until the new postage costs are known. “This is really unfair that we are not getting any advanced notice regarding what shipping discount eBay is giving its sellers. It is unfathomable that by now, they don’t know,” the seller posted in the live-chat session on Wednesday.

The eBay Shipping Team representative explained eBay did not have published rates for Top Rated Sellers and said:

“You can use the percentages below to understand the deeper discounts eTRS members enjoy off USPS Commercial Base pricing:

Avg additional discount for eTRS sellers off Comm Base Prices
First Class Package Service – 0%
Priority Mail – 3%
Priority Mail Express – 3%
Parcel Select Ground – 0%
First Class Package International Service – 15%
Priority Mail International – 20%
Priority Mail Express International – 25%”

Presumably that means the top-rated seller of DVDs would see costs rise from the current $2.04 to $2.60 for packages sent via First Class Package Service – an increase of 56 cents (27%) in shipping costs, and no different from the rates non-TRS receive.

eBay had published some general information about its negotiated rates on a blog post on January 11, 6 days before the new rate take effect, but it has not published information on its Announcement Board where sellers look to for news from the company. You can find charts showing the average savings over retail rates for eBay TRS sellers and non-TRS sellers in this Newsflash article from Tuesday.

One other important piece of information coming out of the session is for sellers who ship packages weighing between 13 oz. and 15.99 oz. They will have to manually change their eBay listings if they wish to take advantage of the fact that the USPS is now extending First Class Package Service beyond the previous 13-ounce limit to 15.99.

A seller asked, “For active listings with calculated Priority Mail shipping for packages weighing between 13 oz. and 15.99 oz.: Will the system automatically change both the rate and the method from Priority Mail to First Class Mail? Or will we need to manually revise each listing?”

The reply from eBay’s Shipping Team: “The system will only calculate shipping off of the USPS Product indicated in the listing. If you have listings from 13-15.99oz that are currently listed with Priority Mail, they will remain Priority Mail. You will have to manually revise those listings if you want to switch the listing service to First Class Package Service.”

One seller expressed disappointment with the results of eBay’s negotiations with the USPS over the new rates, stating that Amazon had negotiated better rates for its sellers, and wondering if eBay was keeping any of the postage discount for itself.

eBay advocate Jim Griffith replied, “I know the people on the shipping team. I also know that they were involved in a three day, closed door negotiations meeting with USPS. And eBay doesn’t keep a part of the negotiated shipping rates for themselves.”

You can read the full 10-page transcript of the chat session on eBay boards.

We delve more into the impact of the USPS rate changes in this EcommerceBytes Blog post from yesterday.

 

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.