How do people make money after the Final Sale fee?
I’ve sold numerous items on eBay, some for a good amount of money others for a small amount but It seems like no matter the profit eBay takes my shipping costs and some of my sales price and I’m left basically giving items away for free or end up losing money. How do people continually make profits with eBay taking 13% of your total sale? I would need to sell the item for more than what I had paid and including shipping cost
20 comments
traditonalproducts
·3 years agoYour questions go to 2 areas, 1) Ebay's T&C's concerning fees & 2) Profit 101.
mightymouse
·3 years agoToo many resellers get caught up in "PROFIT". What you need to thing about is positive cash flow. My average monthly sales are 4000.00, shipping 800.00 buyer pays, Ebay fees 675.00 (on taxes collected also) Cost of goods 560.00. Average sales per item 54.00. So on a normal month 4000+800-800-675-560=2765 profit. But this month I might buy a large collection at 2000.00 to resell at 10,000.00, so my cash flow is 765.00 for the month. Also I my get 5 sales in 1 day and none for 3 days, all i worry about is how the week is going or the month. As long as you are paying cash and not using charge card or loan advance you are making money. All inventory is profit at that point. In normal retail times if you held something longer that 2 years you are loosing money on it, so at that point you just want "some cash back from these items" At some point I will want to retire or just quit. Any money I get at that point will be all profit.
slippinjimmy
·3 years agoMy average gross selling price is $18 - $20, after fees and ALL other costs (shipping, packing, cost of goods) I usually have a net margin of about 65%.
On a $10 item the margin might only be 50%, on a $100 item more like 70%, I have decades of traditional B&M experience where net margins after all costs was more like 10% and my accountant considered that to be very high for traditional retail (most of his clients would never attain a 10% net).
eBay is just a very part-time income supplement for me, If I'm not making in the area of $75/hour I wouldn't bother to do it. My current sales level is as bad as it's ever been but I'm still making my $75/hr goal but instead of working 10 hours per week doing it I now only spend about 2-3 hours per week.
When sales here are in the tank as they have been post Covid I often look at the signs at the local grocery store that are desperate for part-time overnight workers and think that maybe that would be a more enjoyable way to make some extra cash even if it would be technically a pay cut since those jobs only pay $15/hour or so.
If you are selling new full price items the numbers above won't work simply because your cost of goods is very high. If that is your situation then you need to do a lot of volume to attain any sort of profit level that is better than almost any part-time job.
FYI - I don't include the ridiculous amount of time I spend on these boards as part of my "work time", if I did and money was my goal then panhandling would be a better option!
cypress.grove
·3 years agoLove your ephemera listings! I sell antique postcards, and occasional non-postcard paper stuff. For me, it's a volume business. It can take a long time for any single item to sell in my category, so I find I have to list a lot (5k+) if I want to see regular sales. Streamline all your processes (sourcing, sorting, listing, shipping) as much as possible. My total time invested in each listing is only a few minutes from source to ship, believe it or not. Be nice to your customers for repeat business, and be aware of your competition in terms of volume and pricing. Good luck!!!
tobaccocardyahoo
·3 years agoNot every item is worth selling on Ebay or any other online venue.
Every sellers needs to set their own limits on what is worth offering.
My rules
1. List no item that does not generate a $5 profit after all fees and costs.
2. Target a $35 average sale - which means offering some bigger ticket items as well as low priced items
3. Do not offer any item with more than 15 other sellers offering it, and preferably a smaller number of offers.
4. Do not rely on shipping charges to generate profit on a product which is not profitable.
If you do not know what to buy in order to sell profitably, "bottom-feed" until you have enough experience with what sells and how fast. Some of us by hundreds of items in lots and make the cost of the entire lot and some profit with one or two sales.
Stop using auctions. Auctions are now a minority of Ebay sales. Many Ebay auction items only sell on one bid, if they sell.
Stop selling common trading cards and comic books. Your best sellers will be those which some other seller can buy and resell.
rustydalmatian
·3 years agoYou don't make money on what you sold the item for. You make money on what it cost to acquire the item. Your best friend when researching price is the sold button. Comps are what matter when pricing your goods.
buyselljack2016
·3 years agoI make money by purchasing an item at low cost and listing it at 5 to 10 times more than what I paid for it, with the buyer also paying the shipping.
That mark up covers my COG's, shipping, shipping materials, income tax, and eBay fees.
It is called a "business model".
Some things just won't sell for enough to cover expenses. Such item should be avoided.
sapphire_studio
·3 years agoI like what someone on here said about you make your money when you buy your items. How you source is everything.
dbfolks166mt
·3 years agoYou seriously need to develop a cost model BEFORE you list an item. Second, ignore any advice from eBay such as a starting price or the use of PL those are out there to increase eBay's revenue not yours.
Your cost model should factor in all selling costs to get a general idea of what your after tax revenue will actually be. You know the eBay FVF's and how they are applied factor those into your price. If you use calculated shipping and your dim and weights are correct your buyer should be paying the shipping cost. FYI eBay does not "take" your shipping costs you pay USPS to deliver the package out of the gross revenue from the sale.
Once you have factored in the eBay selling costs factor in your COGS, shipping supplies, materials, federal and state income taxes, etc. to get an idea of what price you will need to list the item for on eBay to obtain an acceptable ROI. If you cannot list the item at a competitive price on eBay you may need to look for alternatives to sell your items.
You should always be selling an item for "more than you paid" unless you are just trying to get rid of stuff and potentially looking for a tax write off.
susanb1872
·3 years agoI can see that you had a few auctions that sold at 99 cents and of course would not make any money on that. You have to do the research on these items to see if that was a reasonable starting point and you have to ask yourself, would you be willing to let it go at that price if you only received one bid? Maybe start the auction at the minimum you would take. Also, you need to turn your pictures around so they are facing in the correct position. It is annoying to look at sideways pictures.
laststopgeneralstore
·3 years ago13% fee's is the last thing you should be worried about.
You need to find and source the best possible items that you can find in your area at a low enough price so that you can keep as much of 87% that's left over as possible.
Make sure you're charging for shipping correctly. Don't under charge and don't charge the exact price it's going to cost you to ship, always charge a little more to cover things like time, tape, boxes, mailers, paper, printer, fuel etc...
Source fast selling desirable items. You have have a giant store but it if it's full of stuff people don't want then you're not going to make sales and your sales will be slow.
tdl_collectibles
·3 years agoI think you might need to put your head down and do some research not only on the platform but also what you are trying to sell.
The bulk of your listings are 1987 Topps baseball cards, a junk wax set that I can buy a complete box of for under $50.00. I fail to see how you'd think someone would buy a junk wax overproduced, ungraded card from you for $5.00 plus $5.00 shipping. It's Pete Rose's 25th year and you have a minimum starting bid of $8.00 PLUS $5.00 shipping.
This shows a lack of understanding of value of what you are selling, of better shipping options for what you are selling (Ebay Standard Envelope for sure), but also a lack of seeing what others are selling the cards at.
luckythewinner
·3 years agoHow do people make money after the Final Sale fee?
This is how I do it:
Item: $9.95
Shipping: $3.95
Total: $13.90
Shipping: $3.93
Packing supplies: $0.18
eBay fees: $2.14
Cost of item: $0.30
Net: $7.35 (74% of selling price)
chariot_badges
·3 years agoThis is how I do it:
Item: $9.95
Shipping: $3.95
Total: $13.90
Shipping: $3.93
Packing supplies: $0.18
eBay fees: $2.14
Cost of item: $0.30
Net: $7.35 (74% of selling price)
That is certainly one pricing methodology.
I do it a little different, approach from a different direction.
These are approximations/averages of my actual numbers:
Cost of inventory $2.00
Cost of shipping 4.75
Shipping materials .25
Labor 1.75
Fees, taxes 2.20
----------
TOTAL COST $10.95
=======
The only question now is "how much do I need to make in profit?"
You add that to your costs.
If you need to make $5 then add that to your price offered so you need to sell it for $16.
THEN do the appraisal.
What is it selling for?
$10?
I woudn't list it.
It's land fill.
$25? You hit one. List it.
That's how I do it.
I also have a floor, a rock bottom list price. No matter what, I don't sell for less than that magic number. If it doesn't sell for my mini number ... then it goes into trash.
djvp53
·3 years agoI sell mostly collectible model train items. I source items by buying collections and selling them off in smaller lots. I make money by selling for more than I paid for the items. When I am buying, I look at recent eBay sales to determine selling prices. I use the lowest recent price for a comparable item in comparable condition. Then, I estimate my packaging and shipping costs, factor in sales tax of 8%, and then estimate my eBay listing expenses with a spreadsheet. After all is done, I pay no more than 2/3 of what I come up with. I generally aim to offer about half of what I come up with. Sometimes I get lucky and the asking price for a collection is less than I would have offered off the bat. I just pay the asking price happily. I make the most off those lots. Occasionally, I overestimate what something is worth and I either make less money or take a small loss. In the end, I make some net margin. To cut costs, I reuse shipping materials when possible but I still buy a lot of boxes and bubble wrap, so those packaging costs are part of my estimated expenses. Generally, I'm spending about $1.10 per sale in boxes and packaging material. Good luck.
rosszonebricks
·3 years agoPeople make money by: Understanding the fee structure and pricing accordingly.
Selling something for more than you paid? That is 'making money' at its most basic level.
trescar_26
OP3 years agoMost of your listings are only a few dollars plus 4$ in shipping? I’m not sure how you profit from this?
rosszonebricks
·3 years ago@trescar_26 And yet I do. 🙂
Why? At it's most basic level: I've done the math like I think we all would encourage everyone to do *before* they start selling on eBay.
$2 item cost me ~$0.50-0.60. I bake in the 30 cents per transaction fee into the '+handling' part of 'shipping + handling'.
After GOG, fees, and other 'cost of doing business', that $2 sale profits me about 25% or 50 cents.
OMG only 50 cents? ! One word: VOLUME. 🙂
That, and when buyers buy multiple quantities or multiple items in a single transaction (and a LOT of my customers do) that ROI becomes around 30-35%. As someone else mentioned, supermarkets run about 4% (honestly, it's probably less....), so I'm fine with 30%.
Am I making millions of $ each year? Heck no, but I'm not really trying to either.
isaiah53-57
·3 years agoOK, so just like so many people who post here, the most valuable part of your equation is left out - and that is YOUR TIME... Your time is, and always will be your most valuable commodity - It is limited and should be used to its full potential - I see you had 1754 feedback in the last 12 months - lets surmise that equates to 4000 sales - so if you made $1 in bottom-line profit per sale after all is said and done(which is 2x your .50 cent admission in your post), thats $4000 - My guess is it takes up a bare minimum 20 hrs a week of your time to source, sort, sell, ship. Thats LESS THAN $4 AN HOUR - If I'm off and you make $2 profit per sale, thats less than $8 an hour - You could get a part-time job working 20 hrs a week WITH benefits including paid vacation, medical, 401K and more at so many companies right now making $12-$20 an hour with more freedom and less stress about slow sales, problem buyers, fee hikes, theft, etc etc - That money would also count towards your social security payments at retirement whereas $5 an hour is virtually meaningless to SSI...
I look at the sales data of many who post here and this is the norm, not the exception - Many say they are padding retirement income - OK - the same truth of the paragraph above holds true for them - Plus it would allow them to get out of their dang house and get some real social interaction.
But according to this type of poster, "all is well here at ebay"...
deltilogical
·3 years agoSupermarkets operate on margins of 4%.
The fee is a cost baked into the price - like the taxes when you buy gas.
Sometimes you sell for less than you paid simply for cash flow.
"I would need to sell the item for more than what I had paid and including shipping cost" That's the trick! It is not easy.