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Sat July 24 2021 22:43:07

Seller Asks Why eBay Overcharges Buyers on Shipping

By: Reader

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Dear Ina,
I am a seller on eBay for over 22 years and I have a question that could possibly be interesting for you to investigate.

One of my accounts, the one I've used the longest has, since free shipping became a thing, offered that service. However, I have a smaller account that I started a little over a year ago. There, I charge shipping for the majority of the items I sell.

Since that account was moved to Managed Payments several months ago, I have been noticing that customers are paying inflated shipping rates that are significantly higher than the price I am quoted using the eBay shipping page. 

An example today was a package going to CA from CT. It was 12x12x8 and weighed 5 lbs. The buyer paid a rate of $23.81.

I was charged $14.64 to ship the item by FedEx Home. 

When I called eBay I got a very convoluted answer, no supervisors and the promise of a callback from someone who could definitively explain what happened to the $9.17 difference. 

I also explained that the buyer also paid tax on the excess shipping charge. I noted that this happens regularly.

I also told them I have sent messages to buyers and they've never gotten a refund for overpaying on shipping. I've never seen the money in my bank account. 

I have a feeling eBay has found yet another way to make money meanwhile overcharging and over taxing my customers. I can provide more detail if you are interested and would love to hear what you think of this. Surely I can't be the only person who has noticed this rampant overcharging of buyers.

Love eCommerce Bytes,
Thanks,
Paul



Comments (21) | Permalink

Readers Comments

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This user has validated their user name. by: Rexford

Sun Jul 25 07:05:24 2021

Yes, and they used to criticize sellers who overcharged shipping until they themselves started taking a cut. Now? Not a peep.

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This user has validated their user name. by: toolguy

Sun Jul 25 12:19:09 2021

I'm confused!

If eBay over charged your customer shipping, YOU made most of the "extra" money!

eBay only made 10% on that extra money.

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

Sun Jul 25 13:44:23 2021

@Toolguy

I was thinking the same thing until I read the article a second time and really paid attention to what I was reading.  The seller stated that they are NOT receiving the extra money that is being charged to the Buyer.  I am not sure how this could be happening but would not put anything past Ebay to find a way to pad the bottom line and then when they are caught it will have been a known glitch and they are working on the resolution, which of course will never happen.

If this is actually happening, Ebay has finally found a way to charge their buyers a fee for using their site.  I believe they realize they can no longer keep charging the sellers more and more as I am sure they are losing a lot more sellers and listings than they are willing to disclose.

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This user has validated their user name. by: toolguy

Sun Jul 25 13:50:19 2021

@Silver Ice King

Just because you read it on the internet doesn't make it true.

Any who uses Manged Payments knows that's not how it works.

The shipping cost is deducted from what you have, anything over that the seller keeps!

I could charge $20 for a Small Flat Rate box, eBay doesn't get to keep the difference! I do as the seller, but eBay does get a fee for that overage I charged.

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This user has validated their user name. by: The End

Sun Jul 25 16:45:35 2021

Ebay's stickin' its nose in WAY too deep.
3% on the Item Sold is plenty. PERIOD.
All these suckers who think its normal for Ebay to get anything past that are SUCKERS.

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by: ValueAddedResource This user has validated their user name.

Sun Jul 25 19:54:01 2021

By default the rates shown to buyers are based on standard over the country carrier shipping rates, but the rates shown to seller when purchasing postage reflect eBay's negotiated discounts with the carriers.

If a seller wishes to pass the savings from those negotiated rates on to the buyer, eBay allows you to do that.  Go to  Account Settings > Shipping Preferences > Manage Shipping Settings > Carrier-specific Discounts and select edit next to ''Offer carrier-specific discounts for buyers.''

You then have the option to offer eBay negotiated discounted rates for USPS, UPS, and/or FedEx or you can enter your own discount percentages if you prefer.

As far as charging tax on shipping - that's determined by each state's sales tax laws.  Some states charge tax on shipping and some don't, so eBay has to comply with whatever the state dictates as far as how the tax is calculated and it's based on whatever the buyer actually pays.

Of course any seller considering offering carrier specific discounts should make sure they bake enough into the product pricing to account for the fact that eBay fees will be taken out of that shipping amount and the sales tax will still be calculated on the total, so at that point there may not be a significant savings overall for the buyer.

Personally, I wouldn't worry about it too much - if you're making sales, that would seem to be an indication your total price is in line with what buyers are willing to pay.  If buyers are happy, just keeping selling!

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This user has validated their user name. by: Lightning

Sun Jul 25 23:12:17 2021

I'm with @toolguy on this.  The explanation is wonky.  

I don't see where the OP states that he didn't get the shipping money paid by the buyer.  He just says that there is a $9.17 difference between what was charged and what was paid for shipping to FedEx, likely due to how the calculator works.  The part about ''money not showing up in my bank account'' was tacked on to the buyer not getting any type of refund, meaning it didn't show up on either end.  There is no refund.  The buyer paid what the shipping calculator posted with the listing, and the seller paid what the actual freight was, done deal.  As toolguy said, the seller got the difference, as usually happens with long distance shipments and using the crazy calculator.

The seller should get the entire purchase amount including shipping (less the eBay sales fees), and I have never seen it done any other way.  Pretty sure it's not happening here now, either.  

Where would you see the amount the buyer paid for shipping change into a lesser amount received by the seller???  If the OP is saying that eBay collected the $23.81 and did not relay that entire amount to him, less fees, I'd be interested to see a screenshot of that.  Won't see it though, because it didn't happen.

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by: 4yourinfo This user has validated their user name.

Mon Jul 26 00:07:47 2021

Ina, you should have real sellers like ValueAddedResource work for you. A letter like this with complete Misinformation regarding what is going on at ebay should never be published. This seller apparently has no idea how shipping charges work on ebay. Whatever the buyer pays goes directly to the seller anyone selling on ebay knows that. And as ValueAddedResource explained with the negotiated rate there is an option if you want you can pass it on to the buyer or not. I for one don't pass on negotiated rates as I tend to get ripped off when a buyer purchases multiple items because eBay for some reason refuses to update the size of the shipping box - I can't fit double the amount of stuff in the same size box -  while Carriers charge for dimensional weight. So if there is anyone that ever gets ripped off from shipping it's sellers when they sell multiples!!

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

Mon Jul 26 00:14:07 2021

@Toolguy

I didn't ever say it was true or that I believed what was said.  I said IF it was actually happening that Ebay had found another way to pad their bottom line.  Since I refused to sign up for Mangled Payments I have no idea whether this can or cannot happen.  I know with a normal online platform this would not ever happen, but with Ebay and how difficult they make it (so I have heard and read, but I do understand that not everything on the internet is true) to reconcile what you sold vs what you actually receive, anything is possible.  Remember Ebay is known for ever changing glitches in their platform occurring, (which always seem to favor Ebay) either because of inept programmers who do not Beta test their changes, or deliberate changes so that Ebay receives more than they are entitled to.  

I do not know what happens under the current useless CEO, but Wenig was out and out accused by employees when they left of purposely having these glitches programmed into the platform to steal from their Sellers.  Further evidence that these glitches are intentional lies in the lack of fixes by Ebay when the glitch favors them.  Add in the fact when one is discovered the only people who get their money back are those that wind up spending more time arguing with Ebay than the overcharge is worth.  Ebay could automatically refund the overcharges to all who were effected by this so called glitch, as they do have the ability to identify and refund.  Its just not in their best interest to refund the money as the glitch continues to add to Ebays bottom line allowing them to continue to show some growth.

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by: seattlemagpies This user has validated their user name.

Mon Jul 26 00:16:07 2021

This has nothing to do with managed payments.  When ebay calculates shipping, they use the published retail rate obtained from the shipper.  As a seller, we enjoy the ebay discounted shipping rate.  In the case of Fedex, this difference is HUGE.  There is an option in ebay where you can pass on your discounted label to your buyers.  You take a small hit, but you sell more because the total cost to the buyer is less.

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by: Chicago48 This user has validated their user name.

Mon Jul 26 00:39:52 2021

This problem sounds like something the Atty General of California should look into.

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by: Chicago48 This user has validated their user name.

Mon Jul 26 00:41:19 2021

@SilverIce - it seems to me if this is a BIG problem, seller would use Pirateship or an alternative shipping service.  And the seller should file a complaint with the AG of California.

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by: AreSee This user has validated their user name.

Mon Jul 26 01:29:55 2021

almost 2 years ago, I sold 3 large rather heavy items.  Fedex became available to me through ebay and the shipping costs were well below USPS and UPS.  Happily I sent them by Fedex and was able to refund a portion of the selling charge to the buyers.  Then approximately a month later I was charged by ebay for adjusted shipping charges by Fedex which of course I had to eat. So next time I waited to see if I would receive more Fedex adjustments, if I remember correctly Fedex continued to be very competitive but more accurate as I have not had that happen since.  I stopped selling permanently after 23 years on ebay last June due to ebay's managed payments control.
anyway I wonder if this is what is happening to Paul somehow.

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This user has validated their user name. by: Marie

Mon Jul 26 01:47:13 2021

I'm with Lightning and Toolguy too.  What the OP is explaining about where the money goes is not likely at all.  MP does not secretly retain part of a buyer's payment to a seller for shipping or anything else.

The problems the OP is experiencing is very likely due to information they have in the form that controls the Ebay calculator for that listing.  Ebay does NOT just calculate shipping because they just feel like doing it.  The calculator program has fields that need information and it is the seller that is responsible for that information.

MP would not automatically give the buyer a refund on the shipping either.  That never happens.  That is something the seller would have to process.

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This user has validated their user name. by: Lightning

Mon Jul 26 03:58:50 2021

''This problem sounds like something the Atty General of California should look into. ''

This reaction is exactly why an article like this should not be published at face value, without extensive fact checking.  It is likely a false alarm, not understanding where the money flows, just wrong on the facts.  But look at the minor uproar and piling on that it causes.  Very irresponsible.  

Are there so few things to hate eBay for that we have to make stuff up??  I think not.  Go find a legit problem and complain about that without losing credibility.

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by: FH991586 This user has validated their user name.

Mon Jul 26 08:37:24 2021

I find it weird that most people here challenge the OP's statement without even bringing any supportive evidence.  You could say it's unlikely to be true, pending further investigation, but stating right away it can't be possible is pretty far fetched, since nobody has access to the real data from the OP.

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by: rfm This user has validated their user name.

Mon Jul 26 11:17:01 2021

OP's information is suspect or there is a glitch.  First ebay FedEx rate as stated was calculated as $14.64.  Seller would not actually know what he paid until invoiced after delivery, but lets assume this is the correct amount.  

The problem is the charge to the buyer was not even a FedEx rate, is was the UPS calculated retail rate of $23.81.  So there is something more going on here.  

Since we can't review the original listing with out the item number, it is hard to say what happen.  Suggest OP post on one of the ebay boards with the item number so someone can figure out the problem.

Finally, as many have stated, the seller gets the total buyer paid, minus any fees or charges.  I have never seen an error to the contrary, but there is always a first time.  

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This user has validated their user name. by: Marie

Mon Jul 26 13:12:58 2021

@FH991586
Most aren't.  Some are.  And with the knowledge of how MP works and how calculated shipping works some can tell that what the OP has said is not completely accurate.  It simply is not how the system works.  RFM gives a great example that may be the problem or part of the problem the OP described which would have been caused by an error in how the OP set up their listing for the calculated shipping.

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This user has validated their user name. by: Marie

Mon Jul 26 13:15:13 2021

@lightning

Very well said but that is how it usually goes here.  It is difficult for some to even consider it may be a seller error.  And honest error that others may have made to at some point too.

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by: Jono77 This user has validated their user name.

Mon Jul 26 18:23:24 2021

Sounds like the global shipping program

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