Final Value Fee Scam
Why does eBay have to take a large amount of the transactions into "transaction fees"? It is incredibly frustrating and there is no way around it.
Does anyone have any tips or tricks that somewhat overcome the final value fee?
24 comments
mam98031
·2 years agoWell "large" is subjective. Ebay isn't the cheapest place to sell but they aren't the most expensive either.
Why doe Ebay have a FVF, well the site doesn't run itself, the employees don't work for free, they are actually a pretty good size company with all kinds of costs to get this site useable for all of us.
If you are looking for a way to sell on Ebay and not have to pay them for using their site, no such work around exists, nor should it. They have the right to be paid for work done just as you do.
If you are looking for a free site there are some out there, this just isn't it.
richard1rst
·2 years agoI, and any other experienced sellers here, pay NOTHING in FVF, nor shipping costs, nor promoted fees, nor subscription fees, nor any other charges eBay lists. Let’s say you buy something for $10.00 that you want to sell and net $20.00. You know it is going to cost $6.00 to ship it, and you are going to pay 13.25% in FVF.
Your goal is to receive (($20.00 + $6.00) divided by FVF 0.8675%) for a total of $30.15. THAT becomes your total receipt target. Now, you can offer it at $20 plus $10.15 in shipping, OR $25.00 plus $5.15 shipping, or $30.15 with free shipping, How you get to the $30.15 is irrelevant. The underlying goal is that your buyer sends you $30.15. From your BUYER’S money you pay the FVF and the shipping and you end up with $20.00, which was your goal.
If you can not sell it for that price then you shouldn’t buy it in the first place. Buy something else instead. There are a gazillion products available for resale. Calculate the possibility of your selling price before you buy it.
Let’s play a little mind game.
You are on your way to the post office. Your neighbor flags you down and says, as long as you are going to the post office would you mind saving me a trip and bring this with you? He is a friend and neighbor so of course you say yes. He says, I already know it is going to cost $10.00 to mail it, so he hands you a $10.00 bill.
You get to the post office and, indeed, the cost is $10.00 So you hand the clerk $10.00.
QUESTION - who actually paid for that shipping? You or your neighbor? Now, understand I am not asking who actually gave the money to the clerk - I am asking who bore the COST of mailing the package.
Hint Hint - even though you handed the money to the post office it cost YOU nothing to mail that package because you used your neighbor’s money.
It is the same principle as the FVF fees, shipping, etc. Your BUYER pays you in advance for those costs and you simply forward the BUYER’s money to eBay, the USPS, etc.
Frankly, I don't care what eBay charges in fees because I don't pay any of them. It is no different then when the government says they are going to raise business taxes. The businesses simply raise their prices by the amount of the tax. In which case the extra tax costs the business NOTHING. It is ultimately paid for by the final BUYER.
fashunu4eeuh
·2 years agoHi again. Spent some time looking at your Completed listings, active listings, your competition, and feedback. Really, your listings are very good. After reading multiple pages, I had only a few thoughts. First, to address your original question, is there a way to minimize your Final Value fees? Before knowing how to answer that, need to know a couple of things: What are you paying percentage-wise for FV fees? Have you been hit with any penalties?
Next, I noted the following issues that can possibly cost you more to do business here.
1) Do you need your store subscription? With your 59 listings currently, and eBay allowing each seller 250 free listings before an insertion fee is assessed, your store subscription could be a unneeded expense right now.
2) Returns. Noted that most of your competition accepts returns, and some even promote fitment guarantees as well, both on eBay and other sellers with their own websites, and on other selling venues like Amazon. With vehicle parts, I imagine this is a major concern among buyers, especially with pricier items. Of course your prices may be more attractive to compensate for not offering this service. But they might need to be substantially so.
3) Free shipping. I see you offer this, but if you are worried about fees, one way to possibly limit your costs would be to offer calculated shipping to avoid having to roll all your costs together and hope you have covered all postal zone costs. The buyer should always be covering this expense, either directly by paying postage, or indirectly when you add the hidden free shipping costs into your prices. Normally I'd not make note, but for new sellers to the platform, shipping can be one of the hardest facets to get right. (That's assuming you don't have much experience with mail order, which you very well may have, so pardon the assumption if not applicable.)
4) There are a few titles among your listings that I would add more info to. Such as Item #225645494774 entitled "NEW and GENUINE HONDA RELAY OEM 38580-HN8-A61". Vehicle parts are far from my expertise, but half of the title is taken up by "New and Genuine" which could be moved to the description field. The "and" could definitely be dropped, as could the "New" since condition designations sit at the top of every listing. eBay also often puts the condition on the thumbnail too. I'd debate the usefulness of "Genuine" but if you think your buyers would use that term in their searches, I'd defer to your knowing your market. In general, it's best not to use more generic keywords that may not adequately describe the actual item in place of more pertinent keywords. In this title, would adding "Main Assembly" be a more meaningful descriptor to shoppers than "New and Genuine"?
5) Category selection. I have noticed in passing in my years on eBay that sometimes the Business & Industrial category is not the best choice for motor vehicle parts & accessories. Just a head's up. I see some of your competition using eBay Motors categories over B&I in their listings for the same items you are selling. But like i said, your items are not as familiar products to me so i just wanted to mention the possibility. Not putting items into the most applicable category can really mess up sales, as the items may not show up in Search results because the Item Specifics will not be correct. Item Specifics are very important in listings getting seen, because of SEO (Search Engine Optimization).
Wish you much continued success.
chapeau-noir
·2 years agoEverything is not a 'scam'.
ebeths_eclectic_collectibles
·2 years agoYou could buy up massive amounts of EBay shares, become an activist shareholder and force them to lower FVFs
dbfolks166mt
·2 years agoI have always found it interesting that so many sellers are fixated on eBay's fees. As others have mentioned eBay is a for profit company and their only job is to maximize their value to their shareholders just as most sellers here look to make as much of a profit as they can.
I tend to take a more holistic approach to my selling cost and in general the eBay fees are often a minor portion of my overall selling costs, usually around a 14-15% effective rate. I have a cost model that factors in the eBay fees, shipping costs, COGS, Federal and State Income taxes and operational expenses such as ink, paper, packing materials, POV............
Once I punch the numbers into that model I can determine if I can attain the ROI margin or net after tax profit I am looking to achieve. If I cannot be cost competitive in the marketplace by listing it on eBay I will look for other alternatives where my costs are different.
I follow the old saying "God, grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference."
annadryl
·2 years agoA scam is when someone is tricked out of money, items or information. Were you tricked? Did you not research fees before selling? Why are those fees not worked into your prices so the buyer pays them?
fashunu4eeuh
·2 years agoâ€Does anyone have any tips or tricks that somewhat overcome the final value fee?â€
Hello and welcome, @fivestarparts1 from a fellow north Texan. (Gosh it’s hot here.)
First, put the fees in perspective—eBay’s fees are a deal when you consider you get worldwide exposure and smooth processing of payments. I agree there is a lot of room for improvement at eBay. But inside your niche (motorcycle parts), ebay can still be quite profitable.
No need—yet— to feel depressed or frustrated about how much you have to hand over. Instead, I would encourage you to keep in mind that the reason for this is because you are successfully selling some pricey things—that is very positive for a platform newcomer.
And with a bit of tweaking your listings, you can continue growing that success. There may be a few things you can do to cut costs and maximize profit, so more money goes in your pocket. Have a few suggestions but will have to return later to add to the thread. (Ran out of time, sorry. Will come back.)
joliztoyco
·2 years ago"Does anyone have any tips or tricks that somewhat overcome the final value fee?"
Yes.
Don't sell here.
Not that we're doing all that much "selling" anyway.
chapeau-noir
·2 years agoJust sell everything for 99 cents - I promise you, your final value fees will drop.
ETA: Be sure to use free shipping because you'd have to pay a fee on that, too.
glenvonnie
·2 years agoIt's simple, your buyer should be paying those fees, all of them, and they should be paying for the packaging materials too, you should only be worried about how much profit you're making.
inhawaii
·2 years agoThat's kind of like saying...
Why does the supermarket charge me so much for a loaf of bread and a half gallon of milk?
Is there any way around that?
Yes, there is a way around that.
Don't but bread and milk from that supermarket.
Same with ebay's fees.
The fees are what they are.
Accept the fees and sell here.
Or don't sell here.
laststopgeneralstore
·2 years agoThe only tip or trick is to source better items at the lowest possible price for a profit that you are comfortable with.
KNOW. YOUR. NUMBERS. This is extremely important. Read all the terms and conditions and everything about eBay including how fee's work and then read it over again.
After that THEN you can start listing.
If you're out sourcing items in the wild and have a smartphone(90% of the world does) you can easily go on the eBay app and look up comps. If that item doesn't fit your metrics then leave it and do NOT buy it.
If you buy and continue to buy items that are slow selling for a low profit then overtime you will end up with a large store with very minimal sales which then leads to people blaming eBay for not getting sales.
You do NOT need a big store to get sales, you just need good items with good sell thru rates, listed at a good price and you'll do fine.
byrd69er
·2 years agoDoes anyone have any tips or tricks that somewhat overcome the final value fee?
The only out I see is to not sell here. That's what I did. Best made move in years.
Keep 100%.
janet9988
·2 years agoSell guitars.
luckythewinner
·2 years agoWhy does eBay have to take a large amount of the transactions into "transaction fees"?
Because they are a for-profit company, and the fact that there are 1.5 billion listings here are indisputable evidence that there are plenty of sellers willing to pay them.
Does anyone have any tips or tricks that somewhat overcome the final value fee?
No, I do not think there is any way to cheat eBay out of the fees you agreed to pay when you signed up.
slippinjimmy
·2 years agoWhy? Well that is simple, they need money to pay for their 10,000 employees, they need money to operate their massive data centers, they need money to pay shareholder dividends, they need money for compliance and of course they need money because they are a business that must be profitable to continue providing a service to millions of sellers.
As a buyer I would like to know why sellers need to keep 85% of the selling price, shouldn't they lower THEIR prices so that I as a buyer don't have to pay so much.
If you want to avoid eBay's fees then start your own website! Of course you will probably find that in order to attract buyers you will have to spend an equal or greater amount than what you currently give to eBay if you want to actually have any customers.
hartungcards
·2 years agoYou can easily avoid the final value fees entirely by having a yard sale.
coolections
·2 years agoCorrect, it is frustrating and there is no way around it. When you make a listing just figure the cost at 23% in fees assuming you are mailing things in boxes. Lightweight items has less fees because of lower shipping cost.
dhbookds
·2 years agoWhy is it a scam? you obviously know the cost .......hopefully before you list.......
heckofagame
·2 years agoeBay Top Rated Plus requirements and benefits
Once you've reached Top Rated status, you can qualify your listings for these exclusive Top Rated Plus benefits if you offer same- or 1-business-day handling time and 30-day or longer free returns:
soh.maryl
·2 years agoOvercome the final value fee?
How do you think eBay makes its money?
wastingtime101
·2 years agoBest tip I can offer: You make your money when you source your product.