posted on January 17, 2002 05:41:53 PM new
No matter how you slice it, the cost of doing business just went up. If my property taxes or store rent go up, I have to find a way to increase the gross profit.
The smart people will find more high-end items to sell with higher margins of profit. Then the impact of fees will be deminished by better business decisions.
Ebay is still the place to sell and a good investment too.
posted on January 17, 2002 05:47:11 PM new
Handling is handling -- get over it. I'm not saying add PayPal or BIN fees into Handling. I'm saying you eat THOSE costs, yet charge for other costs that you have been eating in the past. You can give so much for free and now you're simply switching it from one amount to the other.
Quite frankly, all sellers should adopt a Final Value + Fixed Costs (listing fees, etc.) + Shipping model and then buyers wouldn't be so upset -- well they would be but they'd have no legitimate reason to.
But it would take a major overhaul to the buyer mentality to make this work. For now, we just have to take our expenses out of the Final Value and recoup the valid Shipping and Handling fees in S&H.
For those who list the opening price as the sell price -- you're probably paying too much in listing fees and you're not really using the "auction" model anyway, so it doesn't apply to you the same as us regular ebayers.
posted on January 17, 2002 05:49:08 PM new
freyj, you're wrong -- the smart people leave and find somewhere cheaper. If your apartment rent just went up, will you start eating balogna sandwiches for dinner to save money to pay rent?
You don't change your business plan because a vendor increases their rate. You stick to it, but you find alternate ways of keeping your costs down.
posted on January 17, 2002 05:54:12 PM new
" For those who think 5 cents is no biggie -- I bet you flunked math in school. Multiply 5 cents by millions (every day), come back after a month and tell me what you think. "
Springmoon - I can assure you I did not flunk math. There are lots of reasons why the increase. For example, expenses are higher - As a recent former Californian, I can tell you that one area that costs a LOT more than a year ago is energy costs - Many people are paying by a factor of 2 more in electricity bills, and it is even higher for businesses.
Ebay has an obligation to its stockholders to increase revenues. It has not such obligation to the users of the site. It's only obligation to them is to make sure that it works well so the site is up and running for people to sell their items.
the incress in fees is only good for Ebay if people buy what they are selling.
They are selling Auction listing on there site and if just 30% of the sellers sell through has droped off as much as mine this added to incressed fees equils less money for them.
if I can't sell what I list or a good part of it soon I cant afford to list no more.
I have gone from 40 100 listings weekly down to only 14 items list all this month due to lack of sales....
I'm not the only saying auctions sales are way down 85% of all the message boards I post to people are haveing the same trouble now NO SALES.. http://www.Dman-N-Company.com
Email [email protected]
posted on January 17, 2002 06:22:04 PM newRB, one problem with your analogy is that sellers don't set the final price of the item. Bidders do that. So sellers must build in their costs, either in minimum bid, handling fees, etc.
Another problem is that if you sell a toy in a toy store, it costs you as much to sell a $100 toy as to sell a $1 toy. Not so at eBay. So if your minimum bid is at one of eBay's thresholds, raising the minimum bid could double your cost of selling on eBay.
This argument about "build the fee increases into your opening bid" is old, so old that if you have been adding all the fees into your minimum, by now you're probably listing a $10 item at $30 or $40 bucks.
I really wonder why a careful bidder has to complain. They should know ahead of time, either by reading the listing or contacting the seller, exactly what they will be charged. (Fees not disclosed in the ad are a violation of eBay policy.) Which leaves only the buyer who complains, "I thought you'd be shipping this by priority insured, but instead you shipped it by media rate."
That seems a little ridiculous. I remember when posters complained if a seller listed a shipping fee anywhere near $3.50 or $4.00, because a bidder might become confused and assume the rate was for priority mail. Come on, get real.
Do you really think buyers deserve an itemized report of where every little penny goes? Unless the auction says, "WINNER PAYS ACTUAL POSTAGE," any complaint about shipping/handling is inappropriate.
posted on January 17, 2002 06:54:18 PM new
"These increases may cause a lot of $1 -$3 items to disappear."
I don't see why that would happen. Nickel & dime auctions are impacted more when ebay increases the listing fee, not the FVF. The FVF on a $3 auction is currently 15 cents. Under the new FVF, it would be 15.75 cents. And BIN is optional, so sellers can always drop the BIN if they want to save the nickel.
posted on January 17, 2002 07:23:07 PM new
The basic costs such as storage and bandwidth for hosting your auctions are not going up, they are going down, and ebaY's profit on gross for these services are practically obscene. However, ebaY has very ambitious goals profit goals. They also have such a commanding dominance that many more incremental fee increases can be supported before they would be counterproductive. While there are no barriers for others to up set yet another person to person on-line auction site, attracting enough buyers and sellers to constitute meaningful competition to ebay seems far beyond the ability of anyone in sight. As such it looks like ebay fees could easily, bit by bit, rise to at least two or three times the current levels.
posted on January 17, 2002 07:36:12 PM new
"Ebay has an obligation to its stockholders to increase revenues. It has not such obligation to the users of the site. It's only obligation to them is to make sure that it works well so the site is up and running for people to sell their items."
ahc3, eBay does not produce any tangible goods. You cannot go to your supermaket and see a can of milk which says "Made By eBay". They are totally dependent on we sellers, and of course buyers of *our* products (not theirs) to pay back investors. The only thing eBay owns is a bunch of servers and computer equipment, running an overgrown auction software.
What happens when Joe Seller, and millions of others decides that they are not making any money, and pulls their merchandise out of eBay? We sellers (eBay's market makers) also have an obligation to make money. We are selling on eBay for a purpose -- to make money! If I don't meet my obligation, eBay is not going to meet theirs.
Don't you think their primary obligation should be keeping us around? Making sure the site works well is only half the battle. Carnaby, Bidville etc works well but they are missing *us* sellers and buyers. How much it will cost me to sell my widgets, regardless of whether there are a lots of waiting buyers, is all I care about.
That line about cost of energy going up etc is all crock! How much expense does it take to run a bunch of auction websites? We are not talking about automobile factories.
[ edited by springmoon on Jan 17, 2002 07:37 PM ]
posted on January 17, 2002 08:15:25 PM new
> How much it will cost me to sell my widgets, regardless of whether there are a lots of waiting buyers, is all I care about.
Personally, I'm less concerned about costs, as I am about net profits. I am willing to make an investment if my net profit will be better. I'm on eBay because that's where I make the best net profit.
posted on January 17, 2002 08:34:06 PM new
The thing is, where else are you going to go? Ebay is not even close to losing sellers. They really don't owe us anything. What they do need to do is make sure the sellers don't leave, because that does affect their bottom line. With all of their annoying decisions in the past couple of years, that has not happened because there is really nowhere else to go.
Agree on the energy situation, but the point is that it does cost more, not commenting on the companies screwing everyone because there is no shortage of energy...
posted on January 17, 2002 08:45:00 PM new
Well, this ebay fee increase was just on my local news. So it MIGHT spur buyers to come back now that the holidays are over and they might have some money to burn.
But even if sellers left in droves, until the buyers leave too (and find where the sellers have moved to), ebay is the primary game in town.
As for the store comparison, twinsoft is correct. In a store, I take what I paid for the item and all associated costs, tack on a profit margin and there's my price. We cannot do that in an auction.
posted on January 17, 2002 09:11:40 PM new
I would be in heaven if 2 or 3 million sellers quit ebay. More buyers for the remaining sellers. Ebay is like a huge flea market with WAY TOO MANY sellers for the limited number of buyers there. It's a buyer's market now. Some will say it's the large number of sellers that draw the buyers but I think those buyers are hooked on this huge flea market even if the huge number of sellers were cut in half. Compared to the other tiny flea markets eBay is King.
Cuss me out ......
posted on January 17, 2002 09:22:23 PM new
BLAIRWITCH - so you got a Hat from Yahoo - too bad they can't provide buyers to go with the Hats!
Move to Yahoo - HA! Been there, done that - then Yahoo committed suicide - so, think I'll just hang in with eBay.....no I don't like to pay the higher fees, but since no one is actually going to strike, and there won't be a mass exodus - that is always talk and no action - then everyone will grumble but they will pay and stay at eBay.
No serious eBay seller is going to switch to Yahoo just to sit and watch their auction appear for 7 days and not sell - Lower costs on Yahoo can’t compensate for their lack of bidders, and they did that to themselves. For a year, I left eBay for Yahoo, and sold like crazy on Yahoo – THEN, in Jan. last year Yahoo changed and the sellers left, and the buyers left, and it has been the pits ever since.
Too bad, Yahoo was really starting to rival eBay last year, but I suppose suicide was more alluring in their minds --- That says a lot for their minds doesn’t it!
posted on January 17, 2002 09:24:58 PM new
I don't think Yahoo was close to rivaling ebay. Sellers weren't really making money there, and although Yahoo had about 1/3 to 1/2 the number of auctions, Yahoo made almost no money on these listings. I think the current Yahoo format is best (and it is unfortunate that they did not switch to this instead of the insane model they went to last year) - This model keeps out the real junk. I have been selling there, but the action is really at Ebay
posted on January 17, 2002 09:29:24 PM new
Store Rent:$2,500. a month,Phone:150.00 com.rate,Electric:180.00 a month,Advertising:1,200+ a month depending.
<br />
Grand total:4,030 apx.a month to own a reg store in a nice part of town.If my listing fee's were that for a month I've made about $40,000 in sales,Bring on them fee's it's still better then a space in the Mall !!!<br />
[ edited by ijusthaveit on Jan 17, 2002 09:33 PM ]
posted on January 17, 2002 09:43:44 PM new
eBay may be King but this provides the perfect opportunity for Sellers to explore fledgling FREE sites like Carnaby etc.
I am not suggesting Sellers abandon eBay entirely - just make your dollar work for you. List at smaller sites as well and encourage your existing clientele to venture over to your other listings by offering discounts on multiple site purchases. Publicize your listings in your EOA notices. If eBay is going to stick it to Sellers with increased fees and the ridiculous BIN charge, then make the most of your investment.
And before anyone jumps in and tells me there are no bidders there, remember that without Sellers there can BE no bidders.
posted on January 17, 2002 09:45:12 PM newWhat happens when Joe Seller, and millions of others decides that they are not making any money, and pulls their merchandise out of eBay ... If I don't meet my obligation, eBay is not going to meet theirs.
I used to think likewise. But not any more. eBay isn't seller-driven, it's buyer-driven. Sellers come and go.
eBay has repeatedly demonstrated that it can ostracize a seller or group of sellers and still come out smelling like a rose. All the unfavorable seller issues, like no web site linking and no spamming, are practically invisible to buyers. As long as the buyers are at eBay, seller dissatisfaction means nothing.
So, fee increases. Nobody likes it. On the other hand, I'll wager there are plenty of sellers quaking in their boots and thanking their lucky stars eBay didn't double the listing fee. That kind of fee increase would drive thousands of sellers out of business. But for buyers, it would only mean an occasional extra quarter.
At this point, the only thing that can affect eBay is its stock value. Do stockholders care what sellers think? Of course not. As long as eBay stock keeps going up, eBay can do anything. Auctions for America was a gold mine for eBay. While nearly every tech stock is failing, eBay is soaring. I don't see eBay's position changing any time soon.
posted on January 17, 2002 09:58:56 PM new
The fee increases were that bad. You know the buyer is the one that is really going to eat the increase. If this fee increase was too much then it may be time to hang up the sales apron and try something else.
posted on January 17, 2002 11:18:33 PM new
"I would be in heaven if 2 or 3 million sellers quit ebay."
Be careful what you wish for. If 2-3 million sellers left that means sales are poor, and if those buyers weren't going to them, what makes you think they'll go to you? If they came to you, then other sellers will notice sales are picking up and start selling again.
posted on January 17, 2002 11:22:26 PM new
"Move to Yahoo - HA! Been there, done that - then Yahoo committed suicide ."
They never committed suicide, they still have been around just with fewer sellers. The numbers have improved since they dropped the listing fee to 5¢ and and added a FVF.
posted on January 18, 2002 07:13:06 AM new
pleorus:
There is so much confusion on what constitutes shipping costs. We need to break it down in these discussions. In the US a 6oz package would ship usps 1st class/PM for $1.49. Tracking adds $0.40, insurance adds $1.10. So we are at $3.45 already and there is no handling in it or packaging. So it issue is in the details of what is included.
I got a buyer balking at $11.50 PM for a 8# box with FV $10. I get no margin here.
Worst, I dont do enough to warrant UPS pickup and the closest UPS franchise counter adds $3-4 over the UPS counter rate on the web. Buyers look at the web UPS rate and whine that Im overcharging. What is one to do?
posted on January 18, 2002 08:40:47 AM newThat's a poor analagy because when you buy from a toy store they aren't shipping the item. If you bought from an online toy store you would pay for the box, shrinkwrap etc.
No, I wouldn't, at least not separately. What I will pay if I order the toy online is a "handling" fee to cover the cost of the kid in the warehouse who has to pick and pack the item. If the typical eBay seller has paid staff to pick and pack their orders, passing on this cost to buyers would be legit.
If eBay sellers continue to raise their shipping and "handling" fees to make up for lost profits on the sale of the item, then eventually their costs will be the same as the online store. When that happens, who do you think I and most people are going to buy from? The eBay seller operating out of his basement who I have never heard of, or the big online store that has been around for awhile and offers an iron clad guarantee.
posted on January 18, 2002 08:41:16 AM new
JWPC I was surprised to see the hat and I have it on display lol. My friends who also signed up with yahoo got a hat in the mail. Now dont get me wrong it was a nice gift, BUT advertising would be better.
Yahoo did make a BIG boo-boo when they raised the insertion fee, BUT like quickdraw29 said their numbers are slowly growing since the new fees, and sales are getting better. Sellers can only pay so much, and once they are burned out they will have a choice move to yahoo, or quit.
Yahoo is a BIG threat to ebay. We saw proof of that when yahoo had the free listing day during the checkout boycott. It sure dident take long for ebay to change their ways. So now we can list an item on yahoo for the price ebay charges for BIN. The new postal rates may help yahoo as well.
posted on January 18, 2002 09:08:45 AM new
I listed a couple of items on eBay 2 days ago, and listed the same item on Yahoo the same day. The Yahoo listings have more views than eBay's. Usually it is the opposite. However, they both have no bids.
posted on January 18, 2002 09:36:13 AM new
"No, I wouldn't, at least not separately. What I will pay if I order the toy online is a "handling" fee to cover the cost of the kid in the warehouse who has to pick and pack the item. If the typical eBay seller has paid staff to pick and pack their orders, passing on this cost to buyers would be legit."
Ebay sellers are allowed to pay themselves a fair value to pack an item out of the handling fee.
"If eBay sellers continue to raise their shipping and "handling" fees to make up for lost profits on the sale of the item, then eventually their costs will be the same as the online store. When that happens, who do you think I and most people are going to buy from?
You said <<Try another analogy: When I go to the toy store and buy a new toy for $20.00, I pay $20.00. I don't pay separately for the box, shrinkwrap, instructions, etc. - these "costs" are all built-in to the $20.00.>>
When someone comes to my house to pick up an ebay purchase, I do not charge them anything for shipping. How about that.
Like you said, if the s&h fees are stated in the auction, there is nothing ethically wrong.
posted on January 18, 2002 10:33:54 AM new
Even with the eBay increases, they're still the best deal in town. They are by far, the most effective direct marketing medium in existance.
Those of us that have previous direct mail experience can tell you what it costs to market to masses via catalogs, mailers, phone etc. It's expensive and eBay allows us retailers to reach the masses at an unbelievably low cost. In addition, the response rates on eBay are much higher than that of other direct mail methods and customer loyalty is much easier to be built. Response times are also much faster and we are able to capture new customers at a much lower cost than any other direct marketing campaign.
Our eBay bill runs about $2,000.00 a month and I happily pay this bill each time it's due. Why? Because it's worth it, that's why!
There are many out there that would say that we are crazy to pay that kind of money and that we should open a brick & mortar store for this kind of dough. I say why? I'd rather by playing golf on summer days then spending my time behind a cash register. Besides, I run the eBay business part time, which a store would not allow us to do.
I'd like to see more words of thanks for what eBay has created instead of the constant criticism. Here, I'll do it... Thank you eBay for the new market you have created. The marketing medium you have pioneered has created a wonderful way for us to build our entrepreneural business. It continues to be fun for us to sell in this manner and has made us an amazing amount of money for us along the way. And it's only the beginning!
There. That wasn't so hard. Be thankful for the opportunities that are available to you and take a hard minute to think about what your life would be like if eBay wasn't here. If it doesn't mean much to you, than you really shouldn't be complaining anyway. It's easy to bash the eBay giant, but the truth is that it does alot of good for many of us out here. As hard as it sometimes is, we shouldn't forget this.
Gotta go. I'm going to take my new Infinti Q45 to the Post Office. I need some more postage for the meter.
posted on January 18, 2002 10:52:13 AM new
My other car is one of those Infinitis - they don't go in the snow. I have to drive my Escalade instead in the winter
I let my kids use the Hummer to go to school and my wife sometimes uses it to go shopping.
[ edited by RB on Jan 18, 2002 10:55 AM ]
