Taking loss after loss
Summary: kntukyboy initiated a discussion questioning how sellers on eBay manage to sell items at a loss and still sustain their businesses. Several participants proposed explanations such as acquiring products at low costs, using items as loss leaders, and sellers tolerating losses without relying on eBay for primary income. Others suggested that some sellers might miscalculate costs, engage in dropshipping, or utilize promotional tactics. tobaccocardyahoo and jgmot52 highlighted competitive pressures and strategic loss sales to clear inventory. Participants generally noted the complexity of eBay's marketplace dynamics and the varied motivations behind pricing strategies.
Can some of the great veteran Ebayers explain to me how so many sellers can sell new items at a lost and sell oodles of a particular item. It ruins it it for those trying to make a few bucks on a transaction. I have been on Ebay for almost 28 years now and I still don't understand how these sellers can continue taking loss after loss. These type of listings are incredibly abundant across Ebay. . . . .
redlinear
·3 weeks ago@kntukyboy
If it's only worth $3.50 shipped. And shipping was cheaper. You might do what ever you can to get out of the 2000 items you bought and break even on them...just get something out of them.
When shipping costs increase, you may have a million other items and just not realize those items are losing money. Especially if you have employees that list, and other employees that package, and others that ship.
Many businesses are using Gross Revenue (Sales) to determine the value of the business. Possibly to sell the business, but more than likely to get loans or raise capital.
aspme
·3 weeks agoSad truth is they ARE selling at a loss, it doesn't make sense other than some folks aren't good at running a business. recently I had an opportunity to buy a bunch of small Automotive parts at auction, in doing my preliminary research I found 50+ Comp Ebay listings under $5 with free shipping? another occasion, I needed one spark plug to fill out a box of 8 so I could sell them as a set. found a listing on eBay for $3 with free shipping! I bought it thinking to myself this fool is losing money on this sale, and then it shows up on my doorstep in a Priority Mail Padded Envelope!
kibble-net
·3 weeks agoNot everyone is selling to make a profit.
For instance, I do consignment sales. It's not any of my concern whether my client has made a profit on items. I get a commission no matter what. My job is to sell things and get as close to market value as possible for my client.
Lots of sellers are here to get rid of things around the house, unwanted gifts, and so forth. Profit for them is not a concern either.
So, to sum it up, you've made a lot of assumptions in your post, OP. My advice to you is to focus on your own business and not worry about what others are doing. After 28 years, surely you have a system that you've fine tuned?
aspme
·3 weeks ago · EditedDuplicate
civilwarrecreations
·3 weeks agoI'm at it for 20 years and I don't understand it! All I know is I have to base postage/shipping on ZONE 8 rates for everyone. That sucks, but that's the only way I can make money.
soh.maryl
·3 weeks agoCan you explain further? If you're a seller, it's not possible that all your sales are coming from zone 8 buyers, is it? And you're saying that you have to charge excessive shipping to cover deficiencies in item prices?
kntukyboy
OP3 weeks agoI think civilwarrecreations is saying that he charges zon8 shipping charges because he does not know where the order will be coming from. If he gets an order from say zone 2 for example, his shipping charge may be $6.00. On the other hand, if he gets an order from zone 8, the shipping might be $12.00. So in order to possibly not lose money on the order, he charges the largest shipping charge. He can correct me if I am wrong with my assumption.
The only way I know how to fix these shipping cost differences is to use calculated shipping which should take care of the issue regardless of the zone (urban or rural) the order is coming from.
drnusbaum
·3 weeks agoYeah, why don't people specify that they are using Free Shipping when they say weird things like that? I see a lot of these posts that don't make sense otherwise. With how crazy USPS prices have been for years now, I can't believe any independent sellers are NOT using calculated shipping.
jonathanbrightlight
·3 weeks agoJust use Calculated Shipping. Then everyone gets charged the correct rate for their zone, and you can set it up to give them the carrier discount, keep that for yourself, or just provide part of the discount.
ericscardsii
·Aug 14, 2026 at 10:20 PMFencing stolen Items, money laundering, and drug sales
jollyroger14
·Aug 13, 2026 at 3:33 AMSimple...its essentially buying feedback with the new automated system where you get feedback every sale. And too it keeps ur sales up to keep TRS. Also Cassini is designed to favor stores with more volume than others no to little volume. SO selling at a loss keep the ebay gods happy and you make it up on the bigegr item....
onefootflipper
·1 month agoSellers who are registered charities basically don't pay ebay fees. Media megasellers have much better media mail rates than you do. Charity media sellers combine both advantages to be able to sell books and media at a break even point about $2.80 lower than yours.
There are also a lot of sellers that are, well, uninformed, just plain stupid, or never change anything. They use free shipping or never update their shipping prices while the same items sit for years of shipping increases. Some of those people are posting in this very forum. Free ship items in their store, that can't go standard envelope priced at less than $6.
coor1763
·1 month agoI know sellers underprice "Silver" coins for sure. Usually because they're FAKE, GARBAGE, coins!
kntukyboy
OP3 weeks agoI agree and ebay is full of Chinese sellers selling fake coins. Anyone buying from a Chinese seller or someone with feedback less than 20, should automatically assume the coin is FAKE and worthless.
However, there are those unscrupulous American buyers that buy Chinese fake coins and then try to pass them off as the real thing at shows and flea markets to those with lesser knowledge about coins. I see it at almost every flea market I attend.
gloryglorygifts
·1 month agoI know I have a few low cost items up on my store that I got from my old distributor for free. She was looking to retire and just get rid of some of the items so she sent them to me. I didn't even pay for postage. Not everyone is so lucky with that though, but you don't know how much the sellers are getting items price-wise.
sreu3058
·1 month agoQuestion as I understand it:
Even if the seller paid 0 for the item, the shipping cost alone and fees mean negative /loss.
Why?
Answer:
Bait and switch tactics
Charity- seller is well off enough and would like to help those who want item
Environmental concerns: would rather see the item in use than have to dispose.
drnusbaum
·3 weeks agoI don't know what you mean by bait and switch, and the other two seem incredibly unlikely. And there's way too many of these types of sales for any of those to be the general reason.
sreu3058
·3 weeks agoPutting the ‘loss’ products out in hope it will lead the buyer to purchase other items.
A million years ago, I sold electronics in a popular chain store.
We would advertise a VCR for $19.99
When the customer came in saying: Where’s that $19.99 VCR?
We’d say: oh sure, it’s right here. By the way, if you actually want one that records as well as plays tapes, well, that’s right over here for $39.99
yeswayrecords
·1 month agoThe goal of selling is to make money.
These sellers may have developed creative ways of sourcing inventory to allow them to sell for less - and make money.
Selling for a loss is bad business, and those who do so may not remain in business for very long.
fabrics24
·1 month agoMy guess is that there's a strong chance that several sellers aren't actually paying that much for what they're selling.
That's how I can sell at such low prices, anyway.
I mostly sell remnants, meaning the majority of the fabric is used by our primary business. We get a good discount; some fabrics are worth $50/yd, but we can get them for as low as $4/yd. Because we use most of these fabrics, and the remnants are just "byproduct", I can sell them here (if we were a textile retailer, we'd be bound by contract to match our price to the manufacturer's, but we're not.)
My approach is very different from someone who's reselling to live off their funds. Neither is bad or wrong, it's just different. I'm not setting out to make massive amounts of income (not that I'd complain); I'm trying to clear inventory and get a small return while doing so.
Technically, I'm selling at a loss. But it makes enough to sustain itself. We can afford shipping and office supplies with the money made here on eBay, which is good enough for our purposes. It's its own little ecosystem, in a way.
fm2000
·1 month agoSome people simply don't know what they are doing, or are not paying attention to the constant postage increases that happen almost every month now. There are lots of items being sold at a loss after shipping and fees on eBay. I was just looking at a some sellers' stores and several of the them have items up for prices like $1.99 and flat $5.90 GA shipping; a sale will result in a net loss to a rural or non-continental zip. The first time that happened to me I'd panic and go through my store and make sure all of my shipping settings were set up properly... why those sellers don't... who knows. Maybe they just sell things like a hobby and don't care about losses, I can't explain it personally.
shado-x
·1 month agoIt might look like a loss to you, but overall revenue growth trumps earned income.
drnusbaum
·3 weeks agoWhy ? What good is revenue growth if you're making less money ?
bolensparts-360
·1 month agoI call it a race to the bottom , everyone undercuts to make .10 cents a sale not very sustainable unless you do it in volume . The chinese sellers really ruined alot of small american business
kntukyboy
OP1 month agoI really do believe this is going on in large numbers along with many not understanding basic math.
inhawaii
·1 month agoSomething else i've noticed throughout the years.
You don't have the be the lowest price to makes sales.
I often come here to post about it.
Someone will buy my widget for $15 + $9 shipping when the exact same widget is listed for $10 with free shipping.
kntukyboy
OP1 month agoI have seen that as well and I experience it all the time. I believe a lot of that has to do with being a trusted seller with a long track record. Keep your nose clean!
meme6253
·1 month agoThese types of sellers are in abundance & they just keep coming , & It makes it very hard for those of us who try to make a buck & if you cant make a buck why bother with all of this?, I will never understand why I keep putting myself through this.
kntukyboy
OP1 month agoPersonally, I find myself seeking hard to find or niche items to combat this exact thing. Keep fighting!
krazzykats
·1 month agoSome big booksellers slip coupons for other deals into their mailings, and the fees they earn from these help cover part or even all of the mailing costs=free shipping.
fm2000
·1 month ago · EditedThat is one way some media megasellers make money... even though it isn't legally allowed with media mail. They get free or virtually free books by the gaylord, virtually zero of it is ever inspected and just passed through as-is (and their horrible feedback reflects it). Some are also "charities" and get free or even taxpayer funded labor (in the guise of job training.) They don't have to make money from actual book sales. From the perspective of a quality bookseller... they have a real racket going...
krazzykats
·1 month agoI believe that, but I’ve also found the big booksellers very easy to work with when it comes to a complaint about a book.
They’ve never given me any trouble if a book arrives damaged or in unacceptable condition.
They may have their share of negatives, but I’ve never had a big discount bookseller argue over a condition complaint or refund.
And I’ve gotten a few bad books, but most of the used ones I've received are pretty decent+ at a great price.
inhawaii
·1 month agoI've been selling on ebay for over 25 years,
I noticed the strangest thing.
My competitors who undercut me are not in business very long.
kntukyboy
OP1 month agoI agree with you. But the problem is that others quickly replace those that don't understand fees and other costs. I am seeing this problem in a multitude of categories along with thousands of listings across Ebay. It makes it difficult and a little upsetting to someone trying to make some decent scratch or even a viable living through Ebay. Thanks for the comment.
continentalcollectibles
·1 month agoYou would be amazed by the volume of stolen merchandise sold on platforms such as eBay. The company lacks the resources to demand proof of purchase or a detailed accounting of acquisition from every seller. While eBay makes reasonable efforts to verify that sellers are legitimate, the system ultimately relies in significant part on an honor-based approach.
Major arrest reports from across the country repeatedly illustrate the same pattern: individuals acquire goods from thieves, and fences then liquidate those items through eBay, Amazon, Etsy, and similar marketplaces. You are far from alone in questioning how such activity persists.
Nevertheless, those involved are eventually apprehended. Few would willingly exchange even a single hour of incarceration for the proceeds of an eBay transaction. The prudent course is to sell only items that cause no harm to others. Consideration should be given to the victims of theft; shoplifting and related offenses ultimately impose costs on everyone.
top_rated_reseller
·1 month agoStolen products, 0$ investment.
just my opinion.
Impossible to compete. If you try , you lose.
kntukyboy
OP1 month agoI considered that too but they would still be losing money because they (the seller) still have to pay for shipping because the offered free shipping in the listing. No one can make money when costs exceed investment!
top_rated_reseller
·1 month agoif you steal something you have $0 invested, just your time and your freedom.
kntukyboy
OP1 month ago. . . . and ebay fees and shipping costs. At zero cost you are now paying money out of your pocket to get rid of an item. Why would anyone do that? You throw it in the trash before selling it at a loss.
shire123
·1 month agoGoing on the assumption that the item costs the seller nothing, as long as what you sell the item for is greater than the ebay fees and shipping costs then you do make a profit.
kntukyboy
OP1 month agoBut that is not what is being done in these cases.
kiszneysgma
·1 month agoTake the lures you are selling at $18, they are discontinued and sold for clearance for $6 3 years ago, means you got yours to resale at about $2 each. So $2 , shipping and handling (postage and shipping material) $7. So $9 cost leaving you a profit of $9 less eBay fees. You and every other seller is waiting on that sell to happen. And waiting and waiting. In the meantime comes Mrs. Smart seller, she sells hers for $15, same cost as you but she sells hers. She made $6. Bought 3 more and did the same thing. She now has $18. You still have yours.
kntukyboy
OP1 month agoYou make the assumption I am desperate to sell, I am not. One day these sellers selling items on clearance will be out of product, that is where I come in. People that want that particular lure, silver coin or what ever the item may be have to now pay up for the item. In addition I still sell those items along the way. Besides, fishing lures don't eat anything sitting in box. Please check out my sold items. I just sold a lure a couple of days ago that has been on Ebay for 3 years or more. From the day I bought it, it has not needed food, water, or anything else, just a box to keep the dust off of it.
By the way, what does you example have to do with my original post? Additionally, please private message me with the lures you believe I bought on clearance!
kntukyboy
OP1 month ago · EditedYou are really lighting the sky up selling 3 items in July for approximately $60-70 in revenue according to your sold listings. For July only, I sold 32 items with revenue over $1,200.
drnusbaum
·3 weeks agoLol nothing you said made sense...
jgmot52
·1 month agoThere are two root causes for‑cutthroat price competition within product categories.
First, some sellers sell items at a loss for traffic generation and account nurturing. They do not care about profits from individual listings, and boost account activity via completed transactions to secure platform‑endorsed traffic.
Second, sellers are stuck with unsold inventory. Mounting overseas‑warehouse storage and demurrage fees force them to offload stock at rock‑bottom prices to stem losses.
These two factors collectively drive down the market price of the category. Newer incoming sellers struggle to make sales under existing low‑price benchmarks and end‑up with stock backlogs. Burdened by warehouse expenses, they have no choice but to follow suit and sell at a loss.
This creates a vicious cycle, trapping all participants in a passive prisoner’s dilemma of price‑driven cut‑throat competition.
jgmot52
·1 month agoBesides, selling goods at a loss helps clear backlogged inventory quickly, turn stock into working capital and ease cash‑flow strain.
kntukyboy
OP1 month agoAgain, why would you sell at a loss, just throw it away or give it away or wait for some time in the future when you can make money with the item. Continuing to sell at a loss is ridiculous.
kntukyboy
OP1 month agoI think the answer has finally been exposed for my original question. I believe the seller(s) is/are selling on Ebay and then using a Walmart account to ship to the buyer. However, I don't know if that shipping by Walmart is free or not.
As for your comment "Burdened by warehouse expenses, they have no choice but to follow suit and sell at a loss." there is a better option. You never sell at a loss and why would you. Throw the widget away before selling at a loss. You just shut it down and look for greener pastures!
Thanks for the comments!
jgmot52
·1 month agoI appreciate your perspective, and I would love to walk you through the three major practical reasons behind this practice.
First of all, overseas‑warehouse inventory disposal is not complimentary. Extra labour and waste‑handling charges will apply when you abandon goods. You will suffer complete losses on procurement and international‑shipping costs, on top of the disposal expense.
Secondly, even though each sale is made at a net loss, I can still obtain immediately‑available liquid cash. The recovered money supports daily store‑running expenses and covers the purchase of my next batch of goods. No invested funds can ever be got back once I throw away the inventory.
Thirdly, low‑priced listings attract shoppers. These customers may go on to purchase other profitable products from the shop.
Taking everything into consideration, selling at a small loss turns out to be the least‑costly solution.
fullers_uk
·1 month agoWhat country are the sellers based in? if its China they dont care as long as they get paid in USD, the product and the shipping are all paid in China in Yuan which is not much more than a voucher, they have to pay US tariffs but that doesn’t matter because they get them refunded by the Chinese government, all they want is good hard currency in the form of $USD so it doesn’t really matter what they sell items for, but yes it does cause market distortion.
reallynicestamps
·1 month agoThey don't pay US tariffs. The importer pays US tariffs.
fullers_uk
·1 month ago · EditedI ship from the UK to the US I pay the tariffs here in the UK its called PDDP but ebay says my buyer have to pay, they are wrong
fullers_uk
·1 month agofullers_uk
·1 month agoBuyers in the US see this from sellers based in china shipping to the US
fullers_uk
·1 month agoSellers in China pay the tariffs in China.
reallynicestamps
·1 month agoTo whom?
China?
fullers_uk
·1 month agoYes in China, they are collected by the delivery network they ship through so the parcel is delivered to the customer in the US with nothing more to pay, the shipping network then pays the tariffs in the US, but then the seller in China claims the tariffs back from the Chinese government so it costs the seller nothing.
kntukyboy
OP1 month agoUnited States or at least that is what their profile indicates. I don't know if anything can be trusted anymore!
fullers_uk
·1 month agoIt cant be trusted, I could change my location so it looks like I am in the USA and then the warning on my listings about tariff charges disappears and my sales volume would go back to how it was before the tariffs, but it would be lying and I will not do it, but sellers from China get away with it.
kntukyboy
OP1 month agoWell, I only sell to the lower 48 states. I don't mess with international selling and shipment because it can quickly become a pain in the split biscuit very quickly (i.e tariffs). Plus, there are too many countries that can't be trusted (i.e. professional theft rings). I should open up to Japan because they are an honest people and I have many friends that ship to that country without incident. If Ebay would establish a policy as to "absolutely no returns whatsoever on all international orders", I probably would open up selling to the entire world.
It is funny that Ebay offers an Authentification service for collectible cards. They really, really need to do this for coins and permanently kick off the Chinese sellers that are selling counterfeit coins. Side note to all US sellers purchasing "United State coins" from China: If you get caught with a counterfeit coin in your possession that has not been counter-stamped with "FAKE" or "COPY", you can be arrested and processed accordingly.
fullers_uk
·1 month agoShipping worldwide does have its risks but customers from Japan are fantastic, so polite and understand what they are buying, most live in apartments so prefer buying smaller items but a higher value and also rare items, there postal and courier networks are fantastic and very well run, Australia and New Zealand are also good as are the Nordic countries, from years of experience Italy and Greece have terrible postal systems and South Africa is know for months of delays in customs, strangely India has a fantastic postal network and its fast, Israel can be fast on delivery but it very variable in certain areas.
China can do pretty much what they like, in a way I am pleased the US has imposed tariffs, its cost me a large chunk sales and raised my cost mainly due to official misinformation propagated by Ebay but I would expect nothing less.
christworks
·1 month agoWhy are people obessed with how another seller runs their business? I mean you are assuming things you do not know. There are many things that can be going on, some of them mentioned here. How does knowing what they do help your business? It doesn't. You want to help your business find what works for you, rather than trying to figure out what someone else has going on. And if you really want to know, message them and ask.
kntukyboy
OP1 month agoIt does help to know what others are doing because I might discover how others are getting better shipping prices or how they are actually making money at what appears to be lost on the surface. By finding out, it may offer me a new way of selling.
So why are you on here in other peoples business? You are no help by being disruptive and need to go away! I am just seeking answers!
christworks
·1 month agoI'm on here pushing back on the need to know what others have going on. Many people, including myself, run a successful business without needing to know what the competition is doing. Put in the hard work and learn, rather than trying to take a short cut and cheat off someone's paper. You get more respect that way. Then when you figure out the secret sauce that works for you, keep it to yourself and make that money.
kntukyboy
OP1 month agoNow you are making assumptions about what I am trying to find out, please go away if you seriously do not want to help. I have been on Ebay for 28 years and these issues have only arisen in the last few years.
christworks
·1 month ago · Edited@kntukyboy Geeze - what is your problem? You are telling me to go away? You have no right to do that. Someone has some entitlement issues. This board is as much mine as yours. And the fact that you have been selling for 28 years - I sold my first item in 2005 - means nothing. Long time sellers often have problems because they are trying to do things in 2026 that they were doing in 1996.
But, since you clearly don't want any actual advice that will help you, I'll wash my hands of you. I'm sure you'll get it figured out. Well, that is, if your competition doesn't continue to blow you out of the water.
mam98031
·1 month agoWe never know how much another seller paid for the items they are selling or if they got them for free. But I understand your concern.
I check what others sellers are selling items like mine for, but I end up setting a price that works for me, considering what I pay for the inventory.
@kntukyboy Off subject, but I would suggest you take a look at your shipping pricing you have on your listings. You are going to lose more money there on many of the items you are selling. We got a substantial rate increase from USPS in July.
https://pe.usps.com/PriceChange
kntukyboy
OP1 month ago · EditedIt does not make any difference what they paid for the item if they are losing money just for the fact that they are lossing money from shipping costs. This does not have anything to do with the recent shipping increases.
They are selling an item for $3.50 or less (multiple sellers) and offering FREE shipping. Let's say the item was given to them for free. They sell it for $3.50 BIN. Now they have to pay Ebay fees and I can't ship this item anywhere in the United States for less than $5. They are in the RED by several dollars. They are basically giving the product away and throwing money out the window. How can they do that sale after sale or what am I missing?
mam98031
·1 month agoI wasn't speaking to anyone else's shipping charges, so I'm not sure who "they" is. I was commenting on yours. You have a wide variety of rates. Some you will lose money on and others that you will be fine, maybe even a little ahead. For example you have some things shipping for $1.99, 2.99, 3.99 or $4.99, there may be others, but they won't possible ship via USPS Ground Advantage for those amounts.
kntukyboy
OP1 month ago"They" are the people selling items at a loss. As for my listings with what appear low shipping charges, the price of those items are boosted to make up the difference in shipping. EX: I can sell an item for $10 BIN and $6 shipping ... OR ...I can also sell the same item for $14 BIN and $2 shipping or to go a little farther, I can sell the same item for $16 and offer free shipping. No matter which way I choose to list I still get the same amount of money and it still costs the same total amount for the buyer. So actually, I am not losing any money on shipping. People are more attracted to lower shipping charges because psychologically, they think they are getting a better. That is just marketing 101. Plus, I am always testing different selling theories to see what works better in producing more sells.
luckythewinner
·1 month agoYou are assuming:
(a) that they are taking a loss
(b) that they are paying the same amount for shipping that you are
(c) that they cannot afford to sell at a loss
None of those are necessarily true.
kntukyboy
OP1 month agoYou are leaving a lot of details hanging:
(a) Give me an example of how they may not be taking a loss!?
(b) How much less could they be paying than me on shipping and how are they getting a cheaper shipping rate?
(c) why would you sell at a loss, toss it in the trash or give it away?
mozartbach1971
·1 month agoMaybe they are taking a loss on some items to draw people in to see other listings?
kntukyboy
OP1 month agoI think it has been figured out by another commenter.
The seller could also be a seller on Walmart as well as Ebay.
1) Sells item on Ebay
2) Goes into Walmart account & purchases item
3) Gives Walmart the address of the buyer on Ebay
4) Item ships to buyer for free (Walmart account) or small nominal fee.
Can someone confirm this is correct?
christworks
·1 month agoHow are we to know what another selling is doing? Do some sellers dropship? Absolutely. But you don't know if that is happening and neither does eBay.
drnusbaum
·3 weeks agoDropshipping from retailers is a big thing on Ebay (even though against the rules).
It use to be HUGE 10-15 years ago (mass autolisters copying every Amazon item), but it eventually got officially banned by Ebay rules. People still do it and somehow find ways to work around it, but if they get caught they can be banned.
reallynicestamps
·1 month agoWhen we had a B&M shop we bought most items at 20% of retail, books were 40% of retail (but returnable if unsold).
If I bought 100 doohickeys at $20 each (total cost $2000) and sold them at $100 each , the first 20 sold covers my cost ,
I can then sell the next 20 at $80, for a profit of $1600.
And the next 20 at $60 for a profit of $1200
And the next 20 at $40 for a profit of R $800
And the last 20 at $20 each for a profit of $400.
Total cost $2000 Total profit $4000
Obviously I left out overheads like rent, wages, utilities, but you should see the principle.
kntukyboy
OP1 month agoI completely understand what you are doing with this structure, I have done it too. What I am talking about is a completely different animal.
reallynicestamps
·1 month agoNo.
The seller has spent (eg) $1000 to procure stuff. Might be 100 identical items, might be 1000 different items.
Once they have $1000 in sales, everything else* is profit.
They can reduce prices on the remainder as they see fit.
*Again, overhead is being ignored in this answer.
kntukyboy
OP1 month agoI understand your example, it makes perfect since. But, what you are missing is there can't be anymore profit when you are selling at a loss, i.e., losing money on each transaction. In the particular cases I am speaking of, they are identical items selling for $3.50 each BIN. If he offers FREE shipping and pays ebay fees, the seller is losing money. They are in the red! Let's ask the question in a different way. If your costs on a transaction EXCEED your selling cost, how do you make a profit? Secondly, why would you do it over and over. There must be something I am missing.
Check out the listing for yourself. The product is a pack of 6 Equate Adult Toothbrushes.
*Overhead is being ignored (boxes, tape, time, gas to the post office and anything else.)
reallynicestamps
·1 month agoAnd I'm saying you can't know what the seller paid for his product. Including shipping.
I use postage stamps for most of my low value domestic shipping and I do not track those. I might be putting (Canada Post ""P" stamp) $1.24 on the envelope, but we bought our postage decades ago when the stamp sold for 60c at the PO counter in those days and we bought it as part of an estate for 25c. And I get the envelopes from a greeting card salesman who is recycling them.
It looks like I spend $2 or so to ship, but actually I spent a shiny quarter.
drnusbaum
·3 weeks agoThat's an interesting example. At first I thought it was just going to be Walmart dropshipping (Equate brand). However that item is $1 base cost, $1.59 on ebay, so not even possible to make a profit with free ship.
However I notice that account is less than 2 years old, has thousands of feedback, and there is lots of obviously fake feedback on that item.
So 2 other things go on, on ebay.
1) Money laundering, just cycling stuff to yourself or shills, maybe not even bothering to ship, but it all produces necessary sales paperwork from ebay. This would be by criminal orgs.
2) Black market ebay stuff, they build up fake accounts to sell to people, with XYZ selling limits and #### feedback score. Other black market sellers pay big money for pre-vetted accounts to do whatever they plan to do. I actually don't know how they still manage this with ID verifications, but it definition still happens, you can find the black market forums where they do it. That toothbrush guy is basically breaking even, he can automated dropship from Walmart, and just passively build up feedback and selling limits. He will get banned if he gets caught for any of the rule breaking.
Just to be clear this is all AGAINST THE RULES and I am not advocating for it, it should not be on ebay and I hope all such accounts get banned.
tobaccocardyahoo
·1 month agoThere are some sellers who are having items dropshipped from retailers and paying with stolen credit cards. There are sellers who are selling products they obtained by shoplifting or truck hijacking.
There are so many ways to source without paying anything, and fast turns is all that matters to these folks.
Some will not bother to ship the order, either.
On the legit side, many of the sellers of "NEW" product are paying a pittance in liquidation channels and can undercut most sellers who are buying through authorized channels.
Selling on Ebay means having to compete with all of these people. Some other marketplaces limit sales to authorized resellers.
kntukyboy
OP1 month agoYour last couple of sentences are spot on. However, I can't compete by lowing my prices to the point where I am going farther in the red than my competitors. That is sheer lunacy. The example I am speaking of is an Equate 6 pack of adult toothbrushes. (Personally, I can buy this product at Walmart for $1.07). These sellers are selling the exact same item for $3.50 OR LESS . . . AND . . . offering "FREE" shipping.
So, let's make the assumption they got the same item for free somehow. They sell the item for $3.50. They have to pay an Ebay fee of roughly 47 cents (13.5%). Now they have to pay for shipping. Personally, I can't ship this item anywhere in the United States for less than $5.40 and most likely it would be more. Now the math:
Free item +$3.50 (-$0.47) (-$5.40) = (- $2.37) <= They are in the RED!
How can they do this repeatably. These are sellers with many feedbacks and good ratings. I can't compete with them by losing more money than them on each transaction!?
tobaccocardyahoo
·1 month ago · EditedThese folks can have a Walmart+ or whatever they call their equivalent to Prime. They order from Walmart and drop ship for free.
They violate both Ebay and Walmart policy and make a few cents before they are shut down.
Some of those competitors are living in Turkey, Pakistan or Sri Lanka and that money goes a lot further there.
Your sourcing strategy for many of your items would have yielded better results before Walmart.com ramped up its operations, but would still have been difficult to make much money with. Retail arb worked best during the Bush recession when you could buy product from the clearance shelves at Walmart for below their cost.
bashort
·1 month agoHere is what is happening, someone has a widget that they need to get rid of, market is saturated with said widget so they price it at what the market will pay to get rid of it.
kntukyboy
OP1 month agoBut you don't sell the widget at a loss, you throw it in the trash or give it away instead! How are you recouping any money if the ebay fees and the shipping costs are considerably more than what the item sold for? The sellers are giving money away in addition to the widget! They are in the red!
EXAMPLE: Let's say a friend gives you a handful of magic beans for free, no charge (no cost involved on your part). You sell those same beans for $1,000 to someone across the country. However, there is middle man handling the transaction and his fee is $50. Now here comes the biggy, it will cost you $1,200 to ship said beans across the country. Tell me, would you do this with no modifications to the situation I just laid out and looking to make a profit?
pickapaper
·1 month agoIt also depends on what items they are selling. Mega book sellers get special shipping rates for mailing their books. Small things like sports cards, stamps, etc. can be mailed in envelopes. Some sellers might take a loss on selling some things to just get rid of them or to build up feedback.
kntukyboy
OP1 month agoThese are 6 packs of Equate toothbrushes. I can get them at Walmart for $1.07 per pack. The package dimensions is 10" x 5" x 1" and weighs 3.3 ounces. I can't ship this same exact item anywhere in the country for less than $5.40 + ebay fees. These sellers, at least 3 of them, are selling them for $3.50 or LESS and offering FREE SHIPPING. How can they do that and make any profit? The math just does not work!
funfactorychannel
·1 month agotheres barkeepers friend at 3.75 free shipping. There are things that can't be explained.
kntukyboy
OP1 month agoBut Ebay is littered with thousands upon thousands of listings like this across every category. It hurts sellers trying to make money, and especially hurts Ebay because of low fees. I'm just trying to figure out how I could possibly compete with them and still make a few bucks in profit.
shire123
·1 month agoHere's a couple of points.
First. Don't compete with those that SEEM to sell at a loss. Find a product line that you can make a profit on. There are so many products out there where it is possible to profit. As others have said you do not know that they are selling at a loss. (probably are but they have their reasons). And if all they do is sell at a loss then they won't be here long.
Second. Now this is kind of weird. Some people are not into ebay selling to make a profit. They actually enjoy most of what it takes to sell on ebay. I am almost in that category. I am well enough off financially that if I find a product that I like, I do not have to sell it to make a profit. Don't get me wrong. I do try in most cases to make a profit but it is not a requrement. And sometimes the profit is only around 1%. In my case the act of selling on ebay is a lot more like a fun hobby rather than a business. Again, this might be hard for others to understand but it does apply to some people.
I can sense your frustration. But everyone is quite different in their motivations for why and how they do things. Don't beat yourself up over situations you have no control over.
drnusbaum
·3 weeks agoLol the one I saw is $1.59 free shipping. Lucky to break even. But I outlined in another response what I think is going on.