Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Sun Nov 24 2019 20:40:08

eBay Answers Questions about Shipping

By: Ina Steiner

Sponsored Link

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."

You can find the exchange in Message 67 on the November 20th eBay Weekly Chat thread.

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.

Comments (62) | Leave Comment | Permalink
Readers Comments

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: eBay Shill Buster This user has validated their user name.

Mon Nov 25 14:34:24 2019

The only thing bad about PirateShip is their multiple account interface is not very good, if you have a lot of eBay accounts you have to keep deleting them all and keep adding the new account to PirateShip because there is no account ID in the interface.

They need to fix that if they want to keep eBay sellers on their platform.

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

This user has validated their user name. by: toolguy

Mon Nov 25 14:39:24 2019

This is the kind of stuff that upsets me about eBay.

I get this message from my customer: Buyer's note: Bought two items, tried to wait for invoicing to save on shipping, it won't let me. Had to pay for one now, will pay for other when I hear from you or receive invoice.

When pennies piss off the buyer and the seller eBay should take NOTE, but they do not. . . .14 more months and I'm asking for a divorce & removal of my handcuffs!

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

This user has validated their user name. by: NoMoreEbay

Mon Nov 25 14:54:02 2019

Off Topic:

ebay is selling StubHub. It's all over the news.

https://www.cnbc.com/2019/11/25/ebay-nears-deal-to-sell-s
tubhub-to-viagogo-for-about-4-billion-dj-citing-sources.html

https://www.usnews.com/news/business/articles/2019-11-25/ebay-selling-stubhub-to-viagogo-for-45-billion

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

This user has validated their user name. by: iheartjacksparrow

Mon Nov 25 15:13:53 2019

Marie writes (responding to me): "You and I both know that if the article was written about Amazon or Etsy it would still circle back to Ebay.  And your post is a great example of that."

But the article wasn't written about Amazon or Etsy, it was written about eBay. Please look again at the title: "eBay Answers Questions about Shipping." So how could an article "circle back to Ebay [sic]" when the article was about eBay?

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: pace306 This user has validated their user name.

Mon Nov 25 15:17:07 2019

Oh noooooooooo

What are the "stock experts" gonna do NOW?

First eBay and its bad earnings hid behind Paypal - but they NEVER said "sell"
Now eBay and its bad earnings is dumping Stubhub and wont be able to hide behind it - but they dont say "sell"

So now what oh great and mighty stock people - will you say SELL after eBays miserable 4Q earnings - or is it more business as usual ?

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: Mamak This user has validated their user name.

Mon Nov 25 15:30:18 2019

It was very obvious we pay more than eBay pays to USPS when I started to sell a few things on Poshmark and Mercari where the prices were well negotiated.  Ebay has no compelling reason to negotiate the Priority prices down on our behalf only for  their own as they pocket it for themselves along with the 10% fee.  If they gave us any kind of discount which would probably improve our sales they would be giving up the fees on shipping.  I keep getting sick thinking about this company.  

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: maxmad This user has validated their user name.

Mon Nov 25 16:30:09 2019

"6 million packages shipped daily

@toolguy,,,,,,,,,,,,,says
$1.5 billion in USPS postage
#2 USPS customer is eBay"
Proof that eBay is still a very viable selling format. . . .
To those that think eBay is dying let the above numbers sink in.
6 million packages a day!


Those numbers are so Fake it's not even funny,
half of those sales are DOUBLE shipped, once to the ebay's Global Re-shipping Program, then shipped again by ebay, then add the China e-Packet, that USPS delivers,

Ebay is dead

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: eBay Shill Buster This user has validated their user name.

Mon Nov 25 17:36:15 2019

Tool, they screwed up combined shipping long ago because they get 10% of the shipping fees, sellers use to be able to offer combined invoices on multi-product orders without problems, but eBay ruined that.

No with eBay payments a seller will have to pay .25 cents per unique items on combined orders just to process the payment, this company is criminal in nature.

Starting your own website and moving away from venues like eBay who want to control where and how much business they give a seller is the way forward.

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

This user has validated their user name. by: NoMoreEbay

Mon Nov 25 17:47:53 2019

3 million of those 6 million shipped daily are probably returns with the other 2.5 million from China.

Bottom line. ebay is profiting from shipping in both shipping fees and keeping part of the vig. Double dipping. But the seller is now getting triple dipped. Fees, lost vig and fees on shipping tax. To be charged fees on tax is an outrage.

As more and more sellers realize they can no longer profit from selling on fee based sites, they will leave and do something else. At that point with any luck, ebay and it's associated scum will go out of business.

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: Scotty This user has validated their user name.

Mon Nov 25 19:29:31 2019

I just (yestereday) had a crazy buyer change their mind and ask if they could return an item.  I said yes...they then file a return for "Item not as described" once they found out they would have to pay the return postage.  Ebay then "automatically" approves the return and issues a shipping label to this person.
Here's the part that jives with the topic.....I paid $3.27 to ship this item (Media Mail at 2 lbs rate)....ebay charged me $9 for the exact same method and weight for the label issued through their system...which I have no control over.
There is no doubt they gouge us.  If I did that (and I cannot as $4 is the limit I can charge for Media Mail unless multiple itemsz)....they would crucify me.
Like politics....the hypocrisy is staggering.

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: ebayout This user has validated their user name.

Mon Nov 25 21:50:42 2019

Paypal gets 2.9% our shipping costs AND 2.9% of any item tax ebay tacks on.
Just started having taxes added to my sales and didn't realize PP's vig til now.
That's tantamount to a tax on a tax, not a fee.  

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

This user has validated their user name. by: Lightning

Mon Nov 25 23:50:07 2019

@Scotty
To stop that from happening, adjust your return settings to require an RMA#.  Then some of the automatic stuff stops.  The return request may not get automatically approved, unless you have a return policy that allows for returns for any reason.  So it becomes a request instead of automatic.  And even if automatically approved by eBay, they then send you a notice asking if YOU want to provide a label or if you want eBay to provide the label.  I think there may also be a setting like ''return label is to be the same method as the shipping label'' (or similar), if you use EBay Shipping.

During this time, you can check with the buyer, maybe work something out.  And if not, you can assign a random RMA#, make a return label, and send it as a pdf.  You get to control the postage and method.  And you can slow-play the entire process, maybe dragging your feet a bit at each step (not ridiculously), and sometimes the buyer just drops it, too much of a hassle.

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

This user has validated their user name. by: toolguy

Wed Nov 27 12:07:28 2019

@ebayout

"AND 2.9% of any item tax ebay tacks on."

My Paypal doesn't even show the tax collected by eBay and I'm NOT paying any fees on the taxes.

I think you have MISINFORMATION there!

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

This user has validated their user name. by: toolguy

Wed Nov 27 12:12:41 2019

@NoMoreEbay

"3 million of those 6 million shipped daily are probably returns"

The SILLINESS runs deep!

So you're saying that 50% of the items sold on eBay are returned?

Really?

When I read statements like that it's the main reason I come running to eBay's defense!

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: eBay Shill Buster This user has validated their user name.

Wed Nov 27 14:30:56 2019

Tool, you and every seller are paying PayPal fees when sales taxes are collected by eBay, it is included in the total remitted to your PayPal account, but the tax is paid to eBay after PayPal collects their commission on the tax money. So PayPal is profiting for the collection of sales tax, you are paying to process it, not eBay.

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: Silver Ice King This user has validated their user name.

Wed Nov 27 15:29:26 2019

@Toolguy

Effective November 1 (if I have my dates right, Sellers are now paying the 2.96% merchant discount fee on ANY AND ALL Sales Tax that is collected by Ebay for the various states.Up until that point Ebay had been paying those fees, but evidently when he was given the CEO position temporarily, Schenkel also swallowed some smart pills or they would have done this all along as even brick and mortar stores pay the discount on the Sales Tax when they process the tptal sales price.

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

This user has validated their user name. by: CanBrit

Wed Nov 27 19:38:09 2019

@toolguy

You don't see transactions to eBay for tax? I guess you don't buy anything from people on Managed Payments?

Transaction activity Details Gross amount Fee amount Net amount
Oct 31, 2019
Payment to eBay Inc Details -$269.99 USD $0.00 USD -$269.99 USD
Order details Quantity Price Subtotal
Sales Tax
1 $21.60 USD
$21.60 USD
Purchase total $21.60 USD
US_WA_sales_tax@ebay.com

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: eBay Shill Buster This user has validated their user name.

Wed Nov 27 21:57:48 2019

CanBrit, it is a market facilitators tax that the marketplace collects no matter how the sale is made on the marketplace, eBay Payments or PayPal, the tax is still being collected for states that passed the marketplace facilitators tax. It is being collected from all sales on eBay where required.

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

This user has validated their user name. by: Lightning

Thu Nov 28 02:05:05 2019

@Toolguy
You are paying PayPal their usual % on any sales tax brought in on the sale YOU made.  The tax amount is included in the Gross amount you receive, PP takes their % on that total, and THEN forwards the tax itself to eBay.  So YOU are paying the processing fee on the tax, the item, and the shipping, ANY money that passes through PayPal.  Silver Ice King And Shill buster have it right, and you are not even aware of what you are paying.  

Take a close look at any of your sales that have been taxed by eBay, and you will see that it is true.  You will see all the components of the sale itemized - Item cost, tax, shipping, handling, and insurance, which bring you to Gross Sale.  PayPal figures their % off that number, deducts it from your revenue, and also deducts the sales tax to be sent to eBay.

Perminate Link for eBay Answers Questions about Shipping   eBay Answers Questions about Shipping

by: bearbear This user has validated their user name.

Thu Nov 28 10:01:14 2019

I sent the agreement to a BIG Tort Lawyer who reviewed it and said it's perfectly legal. So complaining about it gets us no where. Unless you offer free shipping, using another Service won't get you a discount as it's paid when the Customer pays.  

Click to view more comments
1 2 3 4  [Next Page]


Login is required to post comments.
To sign in to leave a comment, fill in the form below. If you have not yet signed up for AB Verify, or if you'd like more information, go to the Registration Page
.

Login for AB Verify
Be sure and use your email address and password to log in.

 
Email:
Password:
 
 Forgot Your Password?
 Even though you are signed in with the AuctionBytes Blog, you will have to sign in to the EcommerceBytes blog. But you can sign in with your existing AB Verify info.