eBay

jbwoodco · ‎09-10-2019

For all of you out there that don't understand why Ebay charges a Final Value Fee it is this, plain and simple. It was a way to boost their profits without providing anything for the extra revenue. It took me all of 5 seconds to figure this out and I will explain why. I have read posts about this and seen the "levelling the playing field" argument and it is wrong. Ebay could have solved this problem ethically without charging a FVF on shipping. All they had to do was charge a FVF on manually added shipping and not on calculated shipping. That punishes those abusing the system and rewards those that are being fair and honest. Like I said, it took me literally no time at all to see the ethical solution and I'm no genius. Shame on you Ebay.

upgradedendmills · ‎09-10-2019

In my case, I have gone to "free shipping" on most of my listings to avoid customer concerns and avoid most problems. On individual listings, my shipping costs can easily amount to 30% of the total cost of an item. Most of my listings can be shipped 1st Class package rate for average $4-$6 so the FVF on shipping is not too bad to absorb and build into the listing. By using Flat Rate Priority on multiple purchases, I can usually provide discounts or rebates to my customers at minimum cost to myself.

For sellers that have items where shipping is a major percentage of the total cost of a sale charging FVF's on shipping is obscene! It increases the cost of any item and certainly slows sales. I believe that if eBay were to stop this unethical practice it would immediately lead to increased sales overall and more satisfied customers. There have always been and will always be sellers that game the system for some perceived advantage, but, punitive measures by eBay for all sellers won't fix the problem and only costs our customers additional money and results in slower sales.

I hate to think about it as a money grab, but it is becoming more clear by the day that eBay is a desperate company willing to sell non-existent products for higher profits.

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greg5000 · ‎09-10-2019

Charging fees on shipping is not a good business practice.

It's clearly not fair to sellers, especially those who ship larger items and have higher shipping costs.

trene-n-josh · ‎09-10-2019

So that means that anyone who charges flat rate shipping - even the exact amount of postage has to pay an FVF. Do you realize that if you charge calculated shipping you can still build in a handling Charge - $50 if you like. Your system doesn't work.

the*dog*ate*my*tablecloth · ‎09-10-2019

It was to level the playing field so it didn't matter whether the seller used "free" shipping, actual shipping OR shipping and handling. Why should a seller who chooses "free" shipping with the same total pay higher fees?

Ebay gave up a lot of things when they changed the FVF structure. They dropped the percentage in some cats, starting giving free listings and free pictures.

Other sites have charged this way for years, including Amazon. It's simply the most fair to all sellers across the board. Selling large heavy items makes more sense to do locally.

Final value fees are charged on total revenue. How much the shipping expense is that the seller chooses is totally irrelevant. It is just one expense of many. People wouldn't even notice the change if Ebay charged it all at once.

kensgiftshop · ‎09-10-2019

Just like Pay Pal, they charge you a fee on the money you receive from the buyer.

The main reason people complain about Ebay and not Pay Pal, is because the fee is shown separately on Ebay.

If the fee was together like Pay Pal, people wouldn't even notice they were being charged a fee on the shipping charges.

Have a great day.

earlyant-77 · ‎09-10-2019

To help with the rising shipping costs, ebay should be lowering their shipping FVF on each major USPS/UPS/Fed Ex increase - and this last one was major. It basically stopped most sellers from listing items that always had and always would sell well here like vintage tube electronics. I stopped listing those here when the shipping FVF came into play.

luckythewinner · ‎09-10-2019

@jbwoodco wrote:
I have read posts about this and seen the "levelling the playing field" argument and it is wrong.

"Leveling the playing field" was about taking away the financial penalty for offering free shipping as much as it was about fee avoidance.

Adding a FVF on shipping was a three-way win for eBay .. (1) eliminate fee avoidance, (2) eliminate the financial penalty for offering free shipping, and (3) increasing revenue.

jbwoodco · ‎09-10-2019

"Levelling the playing field" at the expense of the honest sellers is not levelling the playing field at all. It is raising the field and it is a cash grab, simple as that. If you look at Ebay's revenue for those years it is telling. When Ebay initiated FVF on shipping, their revenue doubled in over a couple of years. Not their traffic, their revenue.

Free shipping is not free, as the cost always get's passed on to the buyer, and the FVF is the same wether you give "free shipping" or use calculated shipping. it's all a marketing ploy and tried to force sellers to offer it.

Amazon does NOT charge a FVF on shipping. Albiet their FVF is higher, at least their marketplace has vastly more customers. Selling large items locally is a ridiculous argument as there are much better avenues to sell locally that don't charge anything. The benefit of Ebay is it's acces to the national market which gives you scope beyond your local market.

Shipping costs are not calculated as revenue anywhere in the business world except Ebay.

earlyant-77 · ‎09-10-2019

@jbwoodco wrote:

Shipping costs are not calculated as revenue anywhere in the business world except Ebay.

Sure they are. Most companies who have a UPS/Fed Ex discount will get charged their discounted rates, and invoice the customer for the published rates, making it a small profit center.

jbwoodco · ‎09-10-2019

How do you take away a financial penalty for free shipping by not taking it away at all, and now charging eveyone else the same penalty?

(1) I already showed the ethical way to eliminate fee avoidance. Charge FVF on flat rate shipping and not on calculated shipping.
(2) The way to eliminate the financial penalty on free shipping - ethically - is the same as above. If you use calculated shipping that amount will be deducted from your final value.
(3) I agree.

jbwoodco · ‎09-10-2019

Sigh, the shipping rate is not revenue. The difference is...

lookn4info · ‎09-10-2019

Calculate it.

divwido · ‎09-10-2019

No, it punishes the sellers who are fair and honest. We didn't cause the problem, in fact we complained a lot to eBay, but now we have to pay more.

Good Moms let you lick the Beaters.

Great Moms turn them off first.

m60driver · ‎09-10-2019

Again, for those who never knew or who simply forgot, back in the early heady auction days of Meg Whitman, it was Ebay itself that encouraged bundling costs into S&H and beginning auctions low, like at 1¢. Back then the number one seller, and a darling of Ms. Meg, was the seller listing thousands of pre-owned music CDs at auction for 1¢ with S&H of around $3, which was far above the media shipping rate of the day.

a_c_green · ‎09-10-2019

@luckythewinner wrote:
@jbwoodco wrote:
I have read posts about this and seen the "leveling the playing field" argument and it is wrong.
"Leveling the playing field" was about taking away the financial penalty for offering free shipping as much as it was about fee avoidance.

Adding a FVF on shipping was a three-way win for eBay .. (1) eliminate fee avoidance, (2) eliminate the financial penalty for offering free shipping, and (3) increasing revenue.

To be clear, the unfair aspect has to do with charging the Final Value Fee on postage, not the Shipping charge as a whole. Postage is the only seller expense on which eBay levies a percentage fee, and that is what upsets the playing field between sellers of different items.

Sellers whose postage costs are higher pay a higher FVF as a result, because the amount of revenue they actually collect from the buyer is decreased by the cost of shipping, and yet the FVF is charged on the full amount paid by the buyer, regardless of whether the postage cost to get the item out the door is $5 or $50.

If the cost of postage at Shipping time was deducted from the buyer's payment before the FVFs were calculated, that would indeed "level the playing field" between sellers of light or inexpensive objects and sellers of larger, heavier ones, as both would then be paying FVFs on the amount from the buyer that they actually keep. That cost is easily visible to eBay when the seller prints their Shipping label on-line (and would be an additional incentive to do so for sellers that are still buying retail postage at the post office).

Yes, the current arrangement is not fair and it's a stupid Accounting error, but it's been baked into the eBay billing algorithms for so long that no one is going to change it now (and they have declared as such). Just be sure that you know what your costs will be when you list your item, and charge accordingly.