Reality check? Fee percentage of selling price

[bluemorningglory]

I think that I am not offended by the amount of fees that are charged, but by how the fee structure is frustratingly hidden by Ebay/Paypal. I decided to sit down with a calculator, and find out how much (on average) fees are really costing me. I wanted an average percentage number, so that I could glance at an item while shopping, and say, "Ok, it will cost me this much to sell it. Is it worth buying it to sell on Ebay?"

Let's assume that I am a small seller without a store. I go to a yard sale, and buy some ordinary piece of trash, say the classic frog beanie baby. I intend to sell it on Ebay, and ship it in a small Priority Mail flat rate box. The buyer will use a credit card to send me the money via paypal. What percentage of my selling price will Ebay keep?

I decide to list the item for $10 with buyer paying shipping of $4.95. The auction ends with one bid. I "sold" my item for $10. What percentage of that $10 selling price did Ebay keep?

I started with the Ebay fee calculator, which states that Ebay fees for this item will be a mere $0.90, or 9% of the selling price. I follow a footnote to find that Ebay will also charge me a final value fee on shipping. That is another $0.45 in fees. Why did Ebay put in big bold numbers that my Ebay selling fee was only $0.90?

Next, I go to Paypal. After several frustrating page views, I find that I do not qualify for the 1.9% rate, but the 2.9% rate. This rate is applied to the entire amount sent to me, $14.95. Another $0.43 in fees. I also notice that this 2.9% is in addition to a flat fee of $0.30.

So, add it all up: 0.90 + 0.45 + 0.43 + 0.30 = $2.08

On an item which sold for $10, my selling fees were 21% of the selling price.

We have run several numbers through the calculators, and selling fees of about 20% of the selling price seems to be a fairly consistant estimate for my selling style.

Of course, you should try running a more typical item (high/low price, other categories) for items that you normally sell. For a $1 item with 50 cents shipping, your selling fees would be about 50% of the $1 selling price.

In general, fees would be about 12% of total amount (price plus shipping) sent by seller, plus 30 cents.

[camarotoolman]

way to go. my kind of deal.

[anonymoose99]

NM

[jah0411]

eBay will take a max of 250$ per month if reached. That's some cheap rent for a store if you are a big seller. eBay taking this percentage also helps weed out the small seller who makes mistakes and most of the time gets bad feedback

[**injeanious]

If I knew more about this topic, I'd actually be a good seller.

[skycheifgoods]

Think about the 21%-25% ebay fees and now add your goods aqusition costs, (driving) and now add another 8,5% state tax.  Oh yea!  If you think the tax man doesnt want his cut?....Not Soo!

Whats happening now on youtube is this movement of hyping amazons FBA program.  Its sold by the tubers as the mana from heaven just shove a bunch of stuff in a box and amazon stores, and ships to customers.  Whats not being told is that amazons facilities areent tracking buyers from the states their in thus leaving us with the tax man to settle with one day.  Their are alot of sellers both in ebay and amazon who are spinning their wheels downward,

[flushtownie]

It was the Chinese that was doing that and at the time, ebay was letting them list for free!!! So who was at fault for allowing this to go on, eBay!!!!!

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@firefighter1970 wrote:

i was told by ebay that they charge a fee on s&h because peopl use to sell a 500.00 item for .99 cents and charge 500.00 to ship it so they wouldnt have to pay the final value fee on s&h. thats why they now charge a fee on shipping to stop that. its not fair to the honest person who does things the right way. that fee should waved when it shows that the s&h is being charged to the buyer. they could change it but they are greedy !!!!

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[craneoperator_4]

I used to see listings like that as well,,but they never sold...hmmm

[garibaldiscat]

Man... just kinda kicked myself after I made my sale. Didnt realize ebay went downhill..

Sold a tablet for 100$ with free shipping.. so ebay took 10$ out for fee, then of course paypal took like 4$ something for its fee. Then I have to pay the 8$ in shipping outta my profits. Yea... not cool. Im going to have to go back to my old ways, which is either put shipping costs up, or raise the price to cover the extra fees just so I can get the amount I want.

Anyone tried to contact ebay on this and complain? Or does it seem pointless?

[link_to_the_bay]

The easiest way to solve this problem is the same way the IRS solved the "Itemized Deduction" problem that was being abused and caused high administrative expenses.

Simply allow a standard deduction for shipping & handling expenses based on the item category. A standard deduction for shipping & handling would prevent abuse and maintain fee equity for low priced items.

[tdziemianowicz]

Be a good businessperson and understand your costs.  None of them are "hidden."

If you are a low volume seller like me:

Ebay + paypal = 12.9% + 0.30 per paypal transaction.  If you exceed your limit on Ebay and start incurring insertion fees, pay attention!

Shipping depends on what you sell.  I make sure to cover my shipping cost on all low value items.  On higher value, I see what competition is is doing, and if I need to eat $2, so be it.

My trips to the post office are free, cause I only do it when I'm out running other errands or on the way to work.

No good businessperson wastes their time whining.  If you don't like the fee structure, take your business someplace where you can make more money!

[toughtrader]

We complain after the sell because it is not clear what the charges will be up front. Go to the Ebay "Fees" page and you will not see any percentages listed. Not one.

[russ2100]

Getting tired of FeeBay? Try Bonanza.com. Hopefully enough people try it and it gains in popularity/recognition/exposure. It seems because Ebay was first that they've cornered the online auction market, but there are other options...just depends on how fast you want to sell.

[russ2100]

I noticed that too...I can't find one fee schedule with numbers/percentages spelled out in plain English!

[tdziemianowicz]

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@russ2100 wrote:
I noticed that too...I can't find one fee schedule with numbers/percentages spelled out in plain English!

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Oh, c'mon.  It's all right here in plain English:

http://pages.ebay.com/help/sell/fees.html

If you decide to use a service provider like Ebay, you should plan to take the time to read the terms of your "contract" with them.

If you use paypal to get paid, 13-14% is a good number for your first 50 transactions each month.  Beyond 50 items, you may need to start paying the insertion fees.

I have other complaints about doing business on Ebay, but they are completely transparent on their fees.

[greatbargins_4u]

Thanks for sharing. I have been getting eaten alive on eBay fees and most of my items are under $20. I am going to implement your strategy.