eBay answered some uncomfortable questions about shipping posed by a seller during its recent weekly chat session. One was about the ongoing rumor that eBay profits from its shipping label program that lets sellers purchase postage right from its site.
For example, a seller wrote on this thread from January
: "I have info from a very reliable source connected with eBay shipping that eBay HAS negotiated a lower rate with USPS and are pocketing that money instead of passing the discount along to us. These eBay insiders also expressed their dismay at this practice but that their hands are tied up upper execs to do anything about it."
In Wednesday's chat, a seller asked eBay moderators pointblank: "Can you confirm that labels are a profit cent for eBay or that the money flows through to Pitney Bowes and the shippers? i.e. do eBay have more of a discount than the Commercial rates they give to sellers?"
The eBay moderator responded, "We work to negotiate discounted rates for our sellers and pass these discounts on to any seller who prints labels on eBay."
That response may not be enough to quash the persistent rumor, nor does it address another possible way eBay benefits from carrier partnerships - you might remember the recent EcommerceBytes Blog post
about "positioning discounts" that one carrier offers an unnamed marketplace (thought to be Etsy) as a reward for being a Preferred Shipping Provider (note that the reference to "customer" is the marketplace):
"...if the USPS determines that it has been positioned as the "Preferred Shipping Provider" by the customer, then the customer is entitled to additional "Positioning Discounts" beyond other discounts and growth incentives included in the agreement."
The same seller in Wednesday's chat session also asked what eBay was doing to help smaller sellers that don't qualify for shipping discounts with FedEx or UPS. In an obvious reference to Amazon, the seller wrote, "I see your competition is building its own fleet for delivery and often thus able to do 1 or 2 day delivery. How can eBay remain viable in the long run with ever increasing shipping costs for sellers as the small guys get priced out of the market?"
The moderator replied, "We will continue to strive towards supporting our sellers and giving them an opportunity to compete on an equal playing field, and also work towards improving the shipping options and tools available to our Community to remain competitive in an ever changing market."
One key issue was not addressed during the exchange. eBay (and Etsy) charge commission fees on the total transaction amount (price plus shipping), so every time shipping carriers raise their rates, eBay and Etsy in effect raise their selling fees - but without having to announce a seller fee increase.
It's long overdue for marketplaces to reconsider that policy for the health of their marketplaces given the ever-higher costs of shipping, but it's hard to imagine companies like eBay and Etsy being able to wean themselves from the easy money.