EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com

Tue Mar 19 2013 09:30:23

eBay Makes Major Fee and Feedback Changes in New Spring Release

By: Ina Steiner

As I noted when we introduced our new fee calculators, eBay's fee structure has gotten quite complex, and today, the company is announcing a move to simplify its fee structure - but while there are more opportunities to list with no insertion fees, this should not be seen as an overall decrease in fees.

eBay is announcing its 2013 Spring Seller Release today in which it will offer more free listings and will eliminate its category-based, tiered commission fee structure for non-store owners in favor of a flat across-the board commission.

Sellers without a Store subscription will receive up to 50 free listings per month - either fixed price or auction - and will be charged 10% final value rate across all categories.

For items up to $50, this is good news in many categories for fixed-price listings except for electronics, which had a FVF of 7% for items up to $50. Books that sold for under $50 currently incur a FVF of 13%, for example.

But because there's no tranched FVF structure, this will be a fee increase for high-value items. For example, Clothing Shoes and Accessories currently have a FVF commission of 10% of the total amount of the sale for up to $50, but after that, the FVF drops to 8% of the remaining balance up to $1,000, and drops to 2% of the remaining balance over $1000. Under the new fees, it will be a straight 10% FVF.

For Auctions, non-Store owners paid 9% FVFs across the board (no tranches), and this is increasing to 10%.

eBay is also changing fees for Stores and is making a great number of other changes. See today's Newsflash story for more information about changes to feedback, eBay's attempt to reduce deadbeat buyers, and other news.

eBay is clearly facing pressure from Amazon - it compared its new fee structure with Amazon's - but it left out PayPal fees, while Amazon's referral fees include payment processing fees. Here are some other changes coming to eBay:

- eBay will require Buy It Now prices to be 30% over the starting price for auction BIN listings.

- Beginning May 1, positive, negative, or neutral buyer feedback will be removed from transactions in which an eBay Buyer Protection case is resolved in the seller's favor by eBay, including comments and DSRs.

- Beginning in May, eligible fixed price listings and auction-style listings purchased with Buy It Now will remain for sale until a buyer has paid for the item.

Be sure and read Tuesday's news story for more details, and let us know what you think of these changes and which ones will impact you the most.

Comments (202) | Leave Comment | Permalink

Readers Comments

eBay Makes Major Fee and Feedback Changes in New Spring Release

by: RawFoodGuy

Fri Mar 22 15:01:37 2013

Sadly, after 15 years, this could be the last straw for me. Several years ago I stopped (at age 60-someting) selling collectibles and started selling just new, high end juicers, blenders and other health related stuff. I, like many other small sellers, exclusively drop ship (with free shipping) these new items since I am too small to maintain an inventory on high-end juicers. My small markup was just barely enough to justify using eBay at all, after all the fees (PayPal, eBay, s&h), but at least I made a small profit every month - most of the time.

After an hour on the phone today with eBay tech support it now looks like, after a 50% increase in final value fees, that I will not be able to sell new, drop shipped items on eBay at all.

The other shoe has finally dropped! This move will probably kill most sellers that rely on drop shipping with small margins. eBay probably doesn't even know how many small sellers drop ship, since it isn't really disclosed within their system at all. So I doubt they even considered the impact on them...but it will be significant I believe. I was only making 10-15% gross profit margins, if that. And they will be charging within a few weeks 9% (plus 3-4% on PayPal), for a total of 12% or so. That leaves me about 2% profit margin to cover all costs, returns, refunds, other expenses, etc. So finally I am forced to join the rest of you eBay defectors.

Though even the small net profit I made every month used to be helpful, it will probably be a relief in the end. eBay has been going downhill for sellers like me for a long, long time. I used to make a living on eBay a decade ago. Until now at least I got some pocket change. Now even that looks like it's gone.

If anyone has any ideas on how drop shippers with 10-15% gross margins can continue to exist on eBay, please don't hesitate to let me know.

Very conflicted,
CassandraLee

eBay Makes Major Fee and Feedback Changes in New Spring Release

by: nsc

Sat Mar 23 14:56:12 2013

@Ina, if I'm reading the new ebay subscription page correctly, they plan to change the store subscription fees from end-of-billing period to beginning of month. So if you get your ebay invoice midmonth, and you sign up for a yearly subscription on May 1, on May 15 you will be charged for six weeks of store fees: the prorated period in April under the old rate, plus ALL of May under the new rate.

That should make a nice little pop in revenues for the June quarter end.

But notice: if you decide to quit the subscription next April 25th, your subscription terminates on April 30th -- not on May 15th, which you already paid for. ebay simply intends to steal those extra two weeks of fees.

ebay has also designed their "prorated period" and "first full month invoice" period to be as confusing as possible. The contract auto-renews one day before the anniversary of your signup date, which OVER one month BEFORE your actual subscription ends.

The way I read it, everybody who tries to quit a yearly subscription gets told either a) they can't, because the subscription already automatically renewed, or b) they owe at least one month termination fee because they are only in their 10th (or earlier) subscription month. Slick, huh?

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