shipping

[sirsilvermn]

Can someone educate me on why eBay takes a percentage on all shipping costs although I do my own shipping without buying eBay shipping labels ? Seems like a ripoff but maybe I'm missing something here .

[wastingtime101]

It makes fees equal for everyone.** Some sellers offer free shipping and others offer paid shipping. It wouldn't be right that sellers offering free shipping had exponentially higher fees. Free shipping draws in buyers so eBay wants to encourage it.

It prevents people from trying to game the system and avoid fees by selling items for $1 then charging $300 for "shipping."

Most marketplaces charge fees on the full dollar amount, so it's not something specific to eBay.

** Referring to competitors in the same category selling similar product. Obviously categories with lightweight items will pay less in overall fees on ship costs than categories with heavy items.

[dryophelia]

@sirsilvermn 

Can you explain how you have this many feedback as a seller yet have no idea what fees you pay and have paid all along?

[a_c_green]

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@sirsilvermn wrote:

Can someone educate me on why eBay takes a percentage on all shipping costs although I do my own shipping without buying eBay shipping labels ? Seems like a ripoff but maybe I'm missing something here .

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I know, you'd think they would deduct for the postage cost, but that's not how they bill it. They're charging you a percentage of the buyer's actual payment without regard to how the funds will be allocated.

By "do my own shipping" I hope you mean that you're using an on-line postage service, and not paying full retail over the counter at the post office. The savings of on-line postage (either via eBay or another provider) will quickly add up as compared to the over-the-counter prices.

Also don't forget that your postage costs are deductible at tax time. 

[fab_finds4u]

eBay began charging the fee on item cost and shipping because sellers were avoiding selling fees by charging a penny or .99 for an expensive item but charged  high shipping to recoup the item cost. 

[mybigsale]

@sirsilvermn 

Because they can.

All processors charge a small percentage  (around 3% or less) for payment processing.

With managed payment eBay "simplified" their fees for sellers.  Instead of 2 separate fees (transaction processing fee and Item Commission) eBay has one fee for everything.  The result being an extra approximate 10% commission being paid on both State Taxes and Shipping.

Before managed payment, eBay still collected the extra commission on shipping assuming all sellers were overcharging on shipping and lowering item price to try and cheat eBay out of a fair commission.

I believe eBay is the only marketplace that includes what amounts to a commission paid on Tax and Shipping.  So instead of an approximate 3% transaction fee, eBay sellers pay an approximate 13% combined fee. Whether taxes  increase or shipping prices increase, eBay's profit increase.  I don't see eBay making changes.  Your only choice as an eBay seller is to make sure your customers are covering these extra costs and price accordingly.

[mybigsale]

@sirsilvermn 

 "why eBay takes a percentage on all shipping costs although I do my own shipping"

Just to be clear,  eBay charges you on the total transaction (including shipping) for processing the customers payment for you (Credit Card, PayPal, Taxes) etc. and payment to you. The reason the charge is so high is explained in my previous post. All marketplaces would charge a transaction fee on the total payment - it just wouldn't be as high as eBay charges.

[cascade_jewelry]

Money?