Sponsored Link
Email This Post Email This Post

eBay Managed Payments… So Far So Good?

eBay Managed Payments… So Far So Good?

eBay seller Don Heiden, aka the Auction Professor, discusses his experiences with eBay Managed Payments.

I have been an eBay seller for most of my life. Over the years, most every aspect of the platform has changed or morphed into something almost unrecognizable to those who have been on the site since its beginning. Most of the site features we take for granted these days were simply not available just a few years ago.

Many of the changes and updates eBay does are very helpful to the vast majority of those on the platform, while others seem to be completely counterproductive with little or no benefit to the seller.

eBay’s ability to properly roll out some of these changes should also be of major concern to any seller who has been on the platform for even a couple of years. Most of us know their track record is not so good with their handling of updates, and site issues. Their timing is even worse with many updates scheduled to start during the fourth quarter, which is the busiest time of the year for the majority of resellers.

They are also not the best at informing people of changes or issues when they do happen. Many of us will remember when eBay lost tens of millions of photos from millions of different sellers a few years back and did not acknowledge it for days. They also had no fix for the issue, forcing sellers to spend hours retaking photos, and uploading them back to their listings.

So, when eBay announced their new managed payments program, most resellers were skeptical, at best. The thought of trusting eBay with personal banking information when they could not even hold on to uploaded images was pretty scary to some.

Many of the details they released about the program were vague, and some issues were not covered at all until you were already in the program, such as the banned items list. The banned items’ list is a list of items you cannot sell under managed payments. But managed payments is required, so I hopped right in and signed up as soon as I got the invitation to join.

I joined with low expectation that it would go smoothly. After being on Managed Payments for the better part of a year, the only issues I have had (so far) happened during the registration process. There seems to be an issue sometimes with eBay’s payment system not properly linking your banking information to their system, and I was required to re-register several times. Once that was fixed, it has been smooth sailing ever since.

When you are first placed into Managed Payments, you are automatically set up for daily payouts to your linked bank account. It did take a week or more for the first initial payment to process and post to my bank, but after that, it has posted my funds without fail.

eBay offers two options for payouts. You can either choose a daily or a weekly option. I also had to set up PayPal as my payment method for my shipping labels purchased through the site. There was no option to have those fees taken out of my payouts when I first signed up. Thank goodness they have since made that option available.

I switched to the weekly payout option, and now have my shipping label fees taken out of my payouts, which is something I honestly would recommend to everyone. Using this option, you avoid using a separate payment site, such as PayPal, to pay for your labels. This will save you time and worry at the end of the year when it is tax time, because you would only need to check eBay for your expenses, instead of eBay and PayPal.

You should be aware if you are using eBay’s international standard delivery option; these fees will not be taken out of your payouts, but will be added to your monthly bill. This is not very widely known, and it could give you a bad case of sticker shock when your monthly invoice shows up with the added shipping charges, so you will need to be mindful of that.

The biggest difference in moving from PayPal to eBay for my payment processing is the new fee structure. The promotional material for managed payments states that most sellers will save money over PayPal, but until one was in it and using it, you would have no way to know for sure.

The new fee structure varies drastically from the old one, making it harder to determine what percentage of fees each item will be charged. Some items, such as men’s and women’s shoes that sell for over $100, are free of any final value fees, while those selling for under $100 will cost you a 12.35% final value fee.

Most final value fees will fall between 5.85% on the low end for guitars and 14.35% on the high end for most media related items, such as books, DVDs, CDs, and records.

I would recommend everyone looking over eBay’s “Store selling fees for managed payments sellers” page very closely, which can be found here.

My business is saving a considerable amount over what I used to pay when PayPal processed my payments. And not just from the final value fees I pay, but also from the large increases of free listings eBay added for those in managed payments. I am now given 50,000 more free listings a month than prior to joining managed payments. I have tens of thousands of active listings which I no longer have to pay for, which saves my business over $1,000 a month in extra listings fees, alone.

Finding and printing expense reports is fairly easy, but eBay does have things titled differently in different spots, which can confuse some sellers. With some tabs on eBay, such as the Statement tab in Seller Hub, what you actually get when you download that file is a report titled “Financial Statement,” though it is more of a reconciliation report more than anything else.

Under managed payments, eBay mails out a nearly identical third party payment form (1099-K) that PayPal does, so there were no surprises at the end of the year. I simply go to my Orders tab in the Hub and select the date range I am looking for, and then download a CSV (comma-separated values) format File. A CSV file can be opened and used in Microsoft Excel, Google Docs, and most other office spreadsheet software. This report will have all of your sales for the selected date range, including the total sale value, item cost, postage paid, and any sales tax that was collected.

I also download my invoices from the Payments tab in Seller Hub and pull my store subscription fees, final value fees, and international standard delivery fees from them.

One last report everyone should also download is the Financial Statement, which can also be found on the Payments tab, and is only for sales under managed payments. This last report is what I would call a reconciliation report similar to what PayPal has for their 1099-K form. It has all claims, refunds, chargeback disputes, and adjustments on it.

Between these three forms, you should have everything you need to handle your taxes, whether you are doing them yourself or paying an accountant to do it for you. I have done my own business taxes before, but these days I use an accountant, and I would highly recommend most full time resellers doing the same.

Even though eBay’s roll out of managed payments was not the best, overall, the transition has been smooth. It has saved my business a great deal of money, and it has also offered far more opportunities to sell items to more potential buyers through new payment options, such as Apple Pay and Google Pay.

So far so good!

You can find more information about Managed Payments on eBay.com.

Don Heiden on InstagramDon Heiden on Youtube
Don Heiden
Don Heiden
Don Heiden is a 30-year veteran of online reselling going back to the days of Yahoo Auctions. He runs The Auction Professor YouTube channel posting videos and content about various reselling platforms and topics, and he is a member of the eBay, Amazon, Hip, and other affiliate programs where he may earn a commission when linking to products on those sites. He can also be found on most social networks under the same name, including Instagram. He is also a published professional artist which includes works produced for The Walt Disney Company. He holds an Associate Degree in Database Design, Construction, and Network Administration. He also holds a Bachelor Degree and Master Degree of Research & Communications from The University of Toledo.

7 thoughts on “eBay Managed Payments… So Far So Good?”

  1. That is actually the biggest problem with MP, having to go to 3 places to get all you financial needs, not to mention you have to know how to use spread sheets, none of the 3 reports down loaded match nor did any of them match my 1099 for 2020. This is one of the MOST important part of business, accounting for all expense’s and god forbid I ever get audited, just gonna hang over my ID and sign in and let the IRS try and figure it out.
    Ebay’s MP support is nonexistent, if you can get a call back its from someone not related to MP and might be lucky and they can transfer you to MP.
    Cost is more then Paypal, if you lucky to find a free excel program, if not you have to pay $10-$30 extra a month for one, 14 yrs selling and never needed excel.
    Ebay charges fees on taxes(so does Paypal, 2.9%) its about 8% fee on the tax part. Doesn’t sound like much but it totals around $300-$400 tax collected per month by ebay runs me in $24-$32 in fees extra each month.

  2. Additional final value fees
    You may be charged final value fees if you violate our policy of buying or selling outside of eBay, or we may apply additional final value fees if you are not meeting our performance expectations.

    This statement which was taken verbatim from Selling Fees for Managed Payments (aka Mangled Payments) should be the biggest red flag for everybody selling on there site. This statement says that Ebay can apply additional Final Value Fees to your account if you are not meeting EBAYS PERFORMANCE EXPECTATIONS !!!! So the way I read this and am sure anybody with any common sense would feel the same way, is that Ebay can charge any Seller Extra Fees if they feel you should be doing better than you are selling on their glitch filled platform. This gives them the authorization to decide at any time to charge any and all sellers additional fees because Ebay feels they should be doing better. Are they crazy up there?? This is every seller now agreeing to allow Ebay to decide how much they should be making on each Sellers account, which can also be used to deter Sellers from listing on any other platform other than Ebay.

    This has to be considered illegal in many ways which is why Ebay decided to add it under their policies so that Ebay can use the defense that the Seller agreed to it so what is the problem. This is worse than anything I ever read about how the Mafia ran their business because they are basically saying that you agree to pay whatever amount of fees they want at any given time. Can anyone imagine the fallout from this if Ebay is having an off month once compared to the sales during the Pandemic? Iannone and his hand picked executives had to be sitting in Walkers having put a few down when they came up with this new way to steal from their customers (sorry I should refer to us as Noise like they do). This is another area where the DOJ needs to look at because it is outright theft from its Sellers.

    And to think we thought things were bad under Wenig !!!!!! This may have been another one of his ideas and may have been in place prior to his leaving the company, but Iannone should have taken that clause out immediately and has evidently chosen to be nothing but a thief just like Wenig was, because their is no other name for what this allows Ebay to do at any given time. So if and when Ebay shorts you money from you payments, you really have no grounds to complain now as they have the right to charge you whatever they want to. I was considering trying Mangled Payments when the time comes for me to be “INVITED” to join, but between not offering Micropayment accounts and this nicely hidden policy just put a screeching halt to any such future considerations.

    Where comments are usually Buyer Beware when it comes to making a purchase, now it is Seller Beware of just how deep Ebay decides to reach into your pockets.

  3. “My business is saving a considerable amount over what I used to pay when PayPal processed my payments. And not just from the final value fees I pay,”

    I would like to hear more! Don’s the first MP seller that I’ve seen yet that has made a statement like the one he made in this article and which I have quoted above.

    I would really know how he’s doing it. Unless Don has gotten into the business of selling Air Jordans for $10k a pair and is paying no FVFs whatsoever or has an overwhelming majority of his buyer’s who are sales tax exempt then I have a hard time believing him when he says that Managed Payments has saved him a “considerable amount” in FVFs.

    The newly added store listings allotments for MP sellers can save them thousands of dollars, this is true. But those additional perks are fairly new, and unfortunately do not work for every seller as they are only good in certain categories. So not every seller is going to be able to take advantage of those savings.

    “My business is saving a considerable amount…….”

    1. I’d be happy to explain. When PayPal handled eBay’s payments we were paying $295 for annual Anchor Store subscriptions, which included 10,000 free listings. We have roughly 28,000 listings in just one of our stores. Under PayPal payments we we required to pay eBay .05¢ extra for any listing over the free 10,000 quantity. So for many years we have been paying that .05¢ on roughly 18,000 listings each and every month. That comes to $900 per month in extra fees, which has been costing us $10,800 extra per year in listing fees while we were under PayPal Payment processing.

      Under eBay’s Managed Payments we no longer have to pay that amount so we instantly saved $10,800 the first year alone. We have also been able to save an addition roughly $240 per month by lowering our store level, since eBay has included far more ZIFs (zero insertion fee listings) across all store levels. They have also increased the amount of listings in any category in addition to just those in specific categories. This saves us an additional $2880 in store subscriptions from what we used to pay under PayPal payment processing.

      Lastly with eBay’s new FVF (Final Value Fee) structure we also save. On average our fees have been running roughly on average .02% less then under PayPal processing, which also saves us hundreds of dollars a month in fees. Overall when that’s all added up it’s over $15,000 a year we are not having to paying any more.

      So yes we are saving a considerable amount under eBay’s Managed Payments. I though never stated at all that anyone would or wouldn’t save money under Managed Payments. This was just my personal experience so far under Managed Payments.

  4. tsme35 says:
    Cost is more then Paypal, if you lucky to find a free excel program, if not you have to pay $10-$30 extra a month for one, 14 yrs selling and never needed excel.
    There’s a free program called “Open Office” you can download and it comes with a spreadsheet program. Other than that you can get Google Drive with a spreadsheet; or Windows 10/11 with a free spreadsheet.

  5. So the way I read this and am sure anybody with any common sense would feel the same way, is that Ebay can charge any Seller Extra Fees if they feel you should be doing better than you are selling on their glitch filled platform. This gives them the authorization to decide at any time to charge any and all sellers additional fees because Ebay feels they should be doing better. Are they crazy up there??
    This is why I’m in auctions ONLY and gave up the store 2 years ago. Too many arbitrary fees. Plus, I do most of my sales on other non-EB platforms. EB is my “last resort” platform.

Comments are closed.