A Little Advise on Fees Please

[mags_finds]

Hi Everyone 

I would like some input regarding profitability and eBay / paypal fees

If I buy a clothing widget for 1.00 and sell it for 10.00 and offer free shipping and my actual shipping cost is 5.00. My eBay fee shoudl be about 1.50 is that correct ? and my paypal fee would be about .50 right ? 

Total fees 2.00 + item cost 1.00  total cost not including expenses such as gas etc.  3.00 

net profit 7.00  Does that sound about right ? 

However according to my eBay report my fees are running about 16% and I was just wondering how that is possible ?   Perhaps because i am listing more than 50 listing a month and therefore I am paying the .34  on several listings a month ? 

Can you think of any other reason before I I do a full analysis on  the huge amount of about 400.00 ? 

Also, there used to be a calculator regarding if I shoud open a store, based on number of listings etc.  That seems to have disappeared but there is another blurb saying that unless you are listing 250 items a month a store is not profitable.  This makes no sense to me.  If I list 150 listings and get 50 free then I pay .34 cents for 100 or 34.00 which is 10.00 more than a basic store.  Plus I would get a deal on my final value fees.  So I am confused.  To me it makes sense to open a store ? Opinions ? 

Thanks in advance for all your help 

I love the community 🙂 

Shirley 

[castlemagicmemories]

Ebay charges 14% in fees if you are below standard.

[lewisburggold]

The store has worked out well for us.   If your trying to move a lot it should work out ok.  Always try to list as much as can when you get free listings.  Best regards

[castlemagicmemories]

It is true that a store may not be profitable if the volume of business you do does not warrant it.  It would make no sense to open a store if your profit will cover your fees and that is it.  It also does not increase your limits.

[moo*cow*corner]

If you are offering free shipping, those shipping costs are an expense to you. That 16% fees stated by ebay does not include expenses incurred by offering free shipping.

By your numbers, $1 item cost, $2 ebay and Paypal fees, $5 shipping costs will net you $2 in profit. That's 20% of your $10 sale. My profit is a bit higher than that, usually 35-40% on average. Some items way more, some items way less.

Another way to look at it that you've made $2 on a $1 item, so you've doubled your money. Before taxes of course...lol...I've got to make 5x my initial investment to even consider buying an item. I bust on that goal sometimes, but I never LOSE money if a sale sticks.

I have a basic store and have never completely used my 250 listings. The most I've ever had at one time is about 150.

I also offer free shipping, and I have to include those costs into my profit calculations to get useful numbers. I use Salecalc.com to help me set my prices and figure costs.

[moo*cow*corner]

Additional thoughts-

If you have a basic store, you get a coupon worth $25/quarter year to spend on shipping supplies at the ebay shipping supply store. There's lots of stuff available for clothing sellers, not so much for sellers of other goods like me.

It does help offset the cost of the store, but that's not included in the percentage number that ebay gives you either. Neither are any other incidental expenses you may incur, like donuts, salty snacks, and Starbucks on the way to the PO.

I glance at the number from ebay on my monthly invoices, but always do my own math. It's the only way to be sure.

[garmentvarmint2004]

MAGS...From what Castle saidd---your high fees indicate that your performance is BELOW STANDARD!   if so,  your Account may  be in trouble.  You need right now to clickon   Performance Standards. Are you  getting Defects  for late   Delivery--or Out of Stock issues?   If  so,you really need to fix these problems  first! 

[mags_finds]

I am above standard 🙂 

[ag47silver-us]

A basic store sub gives you 250 BIN free listings and 250 auction style free listings.  It's much more economical then 34$ for 100 listings.  When you list less than 200 and sell less than 50 in a month though, that store subscription charge is a larger percentage because it's a flat rate.  My total fees are 25% including everything but the shipping materials I don't get with credits and the original price of the product.  I don't usually pay for insertion fees ever. 

If I was to sell only 25 items in a month my fees would be much higher since i paid for the store sub regardless. 

[mags_finds]

=Thanks that helps 🙂

[mags_finds]

 am above standard and on my way to top rated actually.  It says if evaluated today I would be Top Rated 🙂 

I

[mags_finds]

Thank you ...That helps 🙂

[moo*cow*corner]

Agreed. $1.50 in ebay FVF on a $10 free shipping sale would indicate Below Standard status.

I missed that detail in my earlier posts.

What does your seller dashboard look like? Check that ASAP!

[castlemagicmemories]

Neither are any other incidental expenses you may incur, like donuts, salty snacks, and Starbucks on the way to the PO.

[castlemagicmemories]

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@garmentvarmint2004wrote:

MAGS...From what Castle saidd---your high fees indicate that your performance is BELOW STANDARD!   if so,  your Account may  be in trouble.  You need right now to clickon   Performance Standards. Are you  getting Defects  for late   Delivery--or Out of Stock issues?   If  so,you really need to fix these problems  first! 

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Thanks, garmentvarmint.  I should have expanded on that, thank you for doing so.

And OP, it is of the utmost importance, as garmentvarmint says, to get your issue with your standing fixed FIRST!  That should be your primary concern now, with all due respect, you have to get out of the below standard designation, if you are in it.