Final Value Fees Are Far More Than Stated 10%

[relicanthology63]

I am fairly new to Ebay as a seller, but I am finding that the fees are far more than stated in Selling Fees in Customer Service page of eBay. I have one item that was 23% in fees and that was before the PayPal fee (35% after that was taken). Now this was a low cost item and I thought, wow, since I made less than $3 on that sale, I need to check my fee percentages. It looks like they are running 12% on most items that I checked. The article on eBay Selling Fees states 10% maximum. 

Wondering what is up with the difference and yes I included the  Final Value Fee on shipping in my cost. 

I realize everyone is here to make money, but after the cost of item, handling cost (a lot more than people think!) and the fees, there is not much incentive. I mean you have a lot of competition and you have to price to sell.  Thank you for any help on this and for keeping it classy. 

[the*dog*ate*my*tablecloth]

Fees are at most 10% of the total amount you take in unless you are below standard, in which case they add 4% to the FVF. The only way you can be getting fees of 23% is if you are calculating it on the item price only. Nobody ever said the fees were 10% of the item price only.

If you sell a $90 item with $10 shipping you will pay $10 in FVF or less unless you are below standard.

[fashunu4eeuh]

Well, the Final Value fees are usually 10% but the overall fees depend on several factors, the Help pages state this:

“The amount we charge depends on the item's price, the format and category you choose for your listing, any optional listing upgrades you add, and whether you're meeting our seller performance standards. Fees may apply if you end your auction-style listing early.”

https://www.ebay.com/help/selling/fees-credits-invoices/selling-fees?id=4364

[dtexley3]

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@relicanthology63 wrote:

I am fairly new to Ebay as a seller, but I am finding that the fees are far more than stated in Selling Fees in Customer Service page of eBay. I have one item that was 23% in fees and that was before the PayPal fee (35% after that was taken). Now this was a low cost item and I thought, wow, since I made less than $3 on that sale, I need to check my fee percentages. It looks like they are running 12% on most items that I checked. The article on eBay Selling Fees states 10% maximum. 

Wondering what is up with the difference and yes I included the  Final Value Fee on shipping in my cost. 

I realize everyone is here to make money, but after the cost of item, handling cost (a lot more than people think!) and the fees, there is not much incentive. I mean you have a lot of competition and you have to price to sell.  Thank you for any help on this and for keeping it classy. 

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How are you calculating your fees?  Paypal only takes 3% + $0.30 so I'm not sure how you went from 23 to 35% there.  Are you including the cost of shipping in your fees?  If so, those are not FVF fees and should not be counted.

It would be helpful if you could give more concrete numbers for us to look at.

[orangehound]

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@relicanthology63 wrote:

I am fairly new to Ebay as a seller, but I am finding that the fees are far more than stated in Selling Fees in Customer Service page of eBay. I have one item that was 23% in fees and that was before the PayPal fee (35% after that was taken). Now this was a low cost item and I thought, wow, since I made less than $3 on that sale, I need to check my fee percentages. It looks like they are running 12% on most items that I checked. The article on eBay Selling Fees states 10% maximum. 

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The fees are correct.  The item you are referring to, I imagine, sold for $5.50 plus $7.20 S&H.

• 10% of 5.50+7.20 is $1.27 ... or 23% of $5.50
• The PayPal fees are 2.9% of 5.50+7.20 + 30 cents, which is 67 cents .... or 12% of $5.50.
• And, of course, 23% + 12% is 35%.

That math is correct.  If the only thing you are concerned about is the percentage of fees, then give free shipping and you will find that your percentage is a more reasonable 12.9%.

The reason that eBay charges all of us a 10% fee on our shipping charges is because sellers used to avoid eBay fees by selling things for 10 cents and then having outrageous shipping of like $20.  eBay got wise and put a stop to it.   Thus, it doesn't matter whether you sell that item for $5.50 + 7.20 SH or $12.70 with free shipping.  The fees amount is the same.

[the*dog*ate*my*tablecloth]

The reason the Fvf calculation includes shipping is that it shouldn’t matter whether a seller lists “free” shipping, exact shipping or shipping and handling if the total is the same. It’s not a punishment, it’s merely a leveling of the playing field.why should free shipping sellers have to pay higher fees.? This way makes far more sense.

[dtexley3]

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@orangehound wrote:

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@relicanthology63 wrote:

I am fairly new to Ebay as a seller, but I am finding that the fees are far more than stated in Selling Fees in Customer Service page of eBay. I have one item that was 23% in fees and that was before the PayPal fee (35% after that was taken). Now this was a low cost item and I thought, wow, since I made less than $3 on that sale, I need to check my fee percentages. It looks like they are running 12% on most items that I checked. The article on eBay Selling Fees states 10% maximum. 

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The fees are correct.  The item you are referring to, I imagine, sold for $5.50 plus $7.20 S&H.

• 10% of 5.50+7.20 is $1.27 ... or 23% of $5.50
• The PayPal fees are 2.9% of 5.50+7.20 + 30 cents, which is 67 cents .... or 12% of $5.50.
• And, of course, 23% + 12% is 35%.

That math is correct.  If the only thing you are concerned about is the percentage of fees, then give free shipping and you will find that your percentage is a more reasonable 12.9%.

The reason that eBay charges all of us a 10% fee on our shipping charges is because sellers used to avoid eBay fees by selling things for 10 cents and then having outrageous shipping of like $20.  eBay got wise and put a stop to it.   Thus, it doesn't matter whether you sell that item for $5.50 + 7.20 SH or $12.70 with free shipping.  The fees amount is the same.

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I disagree with how you are calculating the fees.  You can't take 10% of the 12.70 and then calculate that on the $5.50 price, it's not an accurate way of accounting.  You recieved $12.70, the FVF is $1.27 or 10% of the total cost.  It doesn't matter whether the price is 5.50 + 7.20 or 12.70, FVF is 10% of the total cost.  Paypal is 3% of the total cost as well.  

OP, if your profit margin is too low, you need to either raise your price or add a small handling charge to your shipping to cover the FVF.  Changing to Free shipping will not change the amount of the FVF or the actual percentage you were charged.

[orangehound]

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@dtexley3 wrote:

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I disagree with how you are calculating the fees.  You can't take 10% of the 12.70 and then calculate that on the $5.50 price, it's not an accurate way of accounting.  You recieved $12.70, the FVF is $1.27 or 10% of the total cost.  It doesn't matter whether the price is 5.50 + 7.20 or 12.70, FVF is 10% of the total cost.  Paypal is 3% of the total cost as well.  

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I guess you didn't read the whole thread, and in particular the OP's post, huh?  🙂

[dtexley3]

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@orangehound wrote:

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@dtexley3 wrote:

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I disagree with how you are calculating the fees.  You can't take 10% of the 12.70 and then calculate that on the $5.50 price, it's not an accurate way of accounting.  You recieved $12.70, the FVF is $1.27 or 10% of the total cost.  It doesn't matter whether the price is 5.50 + 7.20 or 12.70, FVF is 10% of the total cost.  Paypal is 3% of the total cost as well.  

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I guess you didn't read the whole thread, and in particular the OP's post, huh?  🙂

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Actually I did, and I stand by my post.  The FVFs are 10% of the total sale, not an artifically increased percentage of the item price.  Applying the fees this way doesn't give an accurate accounting of costs.

[orangehound]

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@dtexley3 wrote:

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@orangehound wrote:

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@dtexley3 wrote:

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I disagree with how you are calculating the fees.  You can't take 10% of the 12.70 and then calculate that on the $5.50 price, it's not an accurate way of accounting.  You recieved $12.70, the FVF is $1.27 or 10% of the total cost.  It doesn't matter whether the price is 5.50 + 7.20 or 12.70, FVF is 10% of the total cost.  Paypal is 3% of the total cost as well.  

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I guess you didn't read the whole thread, and in particular the OP's post, huh?  🙂

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Actually I did, and I stand by my post.  The FVFs are 10% of the total sale, not an artifically increased percentage of the item price.  Applying the fees this way doesn't give an accurate accounting of costs.

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My friend, I know that.  The OP was the one who was doing the accounting that suggested her fees were 23% and 35% ... not me.  And, you specifically asked "How are you calculating your fees?"

So, I laid out how she was doing it.

I simply was showing how she calculated her fees, and then demonstrating that the fee calculation of 10% and 2.9% was on the total of the sales amount and the shipping ...

[dtexley3]

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@orangehound wrote:

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@dtexley3 wrote:

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My friend, I know that.  The OP was the one who was doing the accounting that suggested her fees were 23% and 35% ... not me.  And, you specifically asked "How are you calculating your fees?"

So, I laid out how she was doing it.

I simply was showing how she calculated her fees, and then demonstrating that the fee calculation of 10% and 2.9% was on the total of the sales amount and the shipping ...

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No problem, my head isn't tracking well today.  Check out my post in the Scrounge Lounge to see why.

[ted_200]

If the only thing you are concerned about is the percentage of fees, then give free shipping and you will find that your percentage is a more reasonable 12.9%.

LOL!  eBay math...

Seller is getting paid the exact same amount of money in total, and the fees will be exactly the same too.  Only in eBayLand does that somehow result in a more reasonable percentage. 

Low cost goods with high shipping costs make the fees (as a percentage of your item price, with or without the shipping cost added to it) sky high.  Further, for low cost goods (we'll say $10 item for my example), the .35 listing fee plus the 0.30 fixed portion of the PayPal fee, adds another 6.5% in fees. 

[ted_200]

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@the*dog*ate*my*tablecloth wrote:

The reason the Fvf calculation includes shipping is that it shouldn’t matter whether a seller lists “free” shipping, exact shipping or shipping and handling if the total is the same. It’s not a punishment, it’s merely a leveling of the playing field.why should free shipping sellers have to pay higher fees.? This way makes far more sense.

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That's a reasonable and accurate explanation. 

The only problem is, whether the seller did $5.50 + 7.20 s/h, or did $12.70 + Free s/h, eBay should only charge fees on the $5.50 part, and not the $7.20 shipping cost part.  Adding a 10% fee to the shipping is just bad for business in general, and is no more fair than adding a 10% fee to Sales Tax collections (which I'm sure they'd do to, if they could get away with it). 

eBay gets a fee hike everytime the post office raises rates!  Sellers have to account for all those costs one way or another, and with cheap shipping arrangements over at Amazon and Walmart, eBay is just hastening pricing themselves out of the market... all the while trying to press sellers to make eBay a "low price" marketplace.  Making shipping costs 10% higher than they already are just makes no sense for anyone.

[ted_200]

I disagree with how you are calculating the fees.  You can't take 10% of the 12.70 and then calculate that on the $5.50 price, it's not an accurate way of accounting. 

I guess that depends on who is doing the accounting.   If the seller is doing it, and accounting their money, it's really accurate.  

eBay is just one big FEE-esta!   

[coolections]

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@ted_200 wrote:

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The only problem is, whether the seller did $5.50 + 7.20 s/h, or did $12.70 + Free s/h, eBay should only charge fees on the $5.50 part.

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If the OP charged $12.70 to the buyer (which he did because that is what the buyer paid), how would Ebay be able to only charge fees from a made up cost of $5.50 ?