eBay

e-lek-tron-ics · ‎10-18-2019

On a $100 item, you would think a $25 net profit (after all costs) would be a great margin, but it may not be. If you offer free returns and if a buyer returns the item (in this case, buyers remorse) and let's say you are shipping this 12lb item across the country for $12.00. That means on the free return, your $25 net is now $13 net. (There's no keeping "up to 50%" for buyer's remorse. ) Now that same item has to be relisted again. It sells again to another buyer across the country. PAYPAL keeps $3 (again), free shipping is $12, you've just lost $2.00... Sure I could raise the price, but the market dictates the value of any item, free shipping or no free shipping. What are your thoughts?

luckythewinner · ‎10-18-2019

@e-lek-tron-ics wrote:
On a $100 item, you would think a $25 net profit (after all costs) would be a great margin, but it may not be. If you offer free returns and if a buyer returns the item (in this case, buyers remorse) and let's say you are shipping this 12lb item across the country for $12.00

In other words ... your initial statement ("$25 net profit after all costs") did not really account for "all costs" 🙂

But I'm not disagreeing with you - returns and shrinkage are expenses that need to be taken into account, alongside other expenses like rent, heat, electricity, packing supplies, etc.

mam98031 · ‎10-18-2019

@luckythewinner wrote:
@e-lek-tron-ics wrote:
On a $100 item, you would think a $25 net profit (after all costs) would be a great margin, but it may not be. If you offer free returns and if a buyer returns the item (in this case, buyers remorse) and let's say you are shipping this 12lb item across the country for $12.00
In other words ... your initial statement ("$25 net profit after all costs") did not really account for "all costs" 🙂

But I'm not disagreeing with you - returns and shrinkage are expenses that need to be taken into account, alongside other expenses like rent, heat, electricity, packing supplies, etc.

@luckythewinner

So you think sellers should mark up each listing price to accommodate the costs of a return in case it happens?

mam98031 • Volunteer Community Member • Buyer/Seller since 1999

grasshopperx · ‎10-18-2019

Why are you guys getting so many returns? seriously? With clothes and shoes? I could see a buyer pulling that garbage?? The doesn't fit NIGHTMARE? but what's up here? I've never had a return and never wanted a return from a seller? just asking? I've been on here 20 years? once I never got some bubble wrap I ordered. come to find out the poor seller passed away from a heart attack? One other time a package was lost.??? doesn't happen often.??? fill me in?

femmefan1946 · ‎10-18-2019

If your Dispute rate (win or lose) is less than 1% of your sales, you are about the eBay norm and lower than B&M retail losses.

The longer the period you look at, the more accurate the percentage.

If your Dispute rate (again win or lose) is higher than 5%, you are doing something wrong. It may be choice of products. It may be an inadvertently misleading description. It may be poor packaging. Look in the mirror.

Some items are not meant for mail order. If shipping is high compared to value, this may not be a good product for the format.

Is Free Returns worth whatever perks you get for offering them? I gather this is part of qualifying for TRS? (I have Global TRS which has different qualifications) Are your losses to returns greater than the fee kickback and shipping supply subsidy? Perhaps TRS is not worth your while.

cashvaluerecovery2011 · ‎10-18-2019

Wrong place to expect reasonable profit.

wesk_36 · ‎10-18-2019

Is a $25 net profit enough on eBay?

It's a lot better than many sellers who sell an item for $3-$10 with free shipping...ouch!

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grasshopperx · ‎10-18-2019

This certainly isn't the ebay I grew up on. It aint never coming back. It's too far gone now. I see posters with thousands of items that cant sell anything. wth? I'm gone as soon as manage payments comes in. no way !Only fools will play with that.

fuzzface50 · ‎10-18-2019

Depends on your expenses and lifestyle outside of ebay. for some it would be great money, for others it wouldn't be.

Everyone has a different living standards. Some people make minimum wage while others make a few $100's per hour. Some live in trailers while others live in mansions. Some pay $50 a month for electric while others pay $1,000 a month for it. The list is endless.

You get the picture and this is why your question will get different responses based on people's lifestyles. Basicly there is no right or wrong answer to your question. Some will love a $25 net profit while others would not.

buyselljack2016 · ‎10-18-2019

@grasshopperx wrote:
This certainly isn't the ebay I grew up on. It aint never coming back. It's too far gone now. I see posters with thousands of items that cant sell anything. wth? I'm gone as soon as manage payments comes in. no way !Only fools will play with that.

Well, here I am. A fool:)

As I was expecting to possibly be among the 1st "forced in", I "opted in" on one selling account.

I waited for PP to be an accepted buyer payment method. I had enough "working capital" to await the minor "payout" and checking account deposit "clearing" at my CU delay.

At this point, all has been seamless for me. I have had no issues with MP.

Had a couple of "buyer cancels". The $0.25 per transaction fee was retained, but at this point eBay is crediting the funds "processing" fee.

My only selling internationally is directly to Canada, so no GSP in MP did not concern me.

mam98031 · ‎10-18-2019

@wesk_36 wrote:
Is a $25 net profit enough on eBay?

It's a lot better than many sellers who sell an item for $3-$10 with free shipping...ouch!

@wesk_36

If Free Shipping is decreasing a seller's profit margin then the seller is not pricing their stuff correctly. That isn't the fault of Ebay or Ebay fees but that of the seller that is either not pricing their items correctly or are trying to sell really inexpensive stuff and expect a profit. In that case, the seller should rethink what they are trying to sell if they can't even get enough money for it to cover costs.

mam98031 • Volunteer Community Member • Buyer/Seller since 1999

wesk_36 · ‎10-18-2019

@mam98031 wrote:
@wesk_36 wrote:
Is a $25 net profit enough on eBay?

It's a lot better than many sellers who sell an item for $3-$10 with free shipping...ouch!

@wesk_36

If Free Shipping is decreasing a seller's profit margin then the seller is not pricing their stuff correctly. That isn't the fault of Ebay or Ebay fees but that of the seller that is either not pricing their items correctly or are trying to sell really inexpensive stuff and expect a profit. In that case, the seller should rethink what they are trying to sell if they can't even get enough money for it to cover costs.

I agree, I posted that in comparison, apparently many sellers are happy with pennies for profits or they just don't know what they are doing.

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yuzuha · ‎10-18-2019

@pink.fish.rule wrote:
My thoughts? That I'd be expecting a lot more than $25 nett profit on an item which sold for $100.

Same. I wouldn't even bother with an item that had such a low profit margin compared to its selling price. If I'm selling something for $100, I want to be making at LEAST a $50 profit on it. When I was selling things in the $80-90 range, I was making at least a $40-45 profit off each one.

luckythewinner · ‎10-18-2019

@mam98031 wrote:
So you think sellers should mark up each listing price to accommodate the costs of a return in case it happens?

No - because if you are accounting for return risk after you have already committed to your inventory, you are doing it too late.

I think that before a seller even acquires an item, he should have already considered the likelihood and cost of a return as part of his decision about whether the item is worth selling.

In the OP's hypothetical example, the seller had already calculated his expected profit of $25 before he took the possibility of a return into account. IMHO that should have been part of his calculation before the item was even acquired.

If the seller encountered an item with a high return risk, he might choose to buy it only if it had a higher expected profit to hedge against the risk.

And if the seller found an item with a low return risk, he might accept a lower expected profit in accordance with his risk asessment.

I was simply saying that returns and shrinkage need to be considered alongside other direct costs like acquisition, fees, and shipping.

inhawaii · ‎10-18-2019

I know everyone has their own way for doing things, especial when it comes to profit margins. MY general rule of thumb is ... i wont sell something unless AFTER all fees/shipping/supplies that i can double my money. Sell a $10 item for $23 + $5 S&H when the actual shipping cost is about $4. I will do that all day long.

On larger ticket items, i may change that rule of thumb. Example: If i can buy a widget for $400 and easily sell it for $500 to make a $100 profit. I will do that all day long,

Good luck to you!

Undone - Bachman & Cummings

lintbrush* · ‎10-18-2019

I'm with @yuzuha and @pink.fish.rule

I'm not going to invest $75 to make $25 on eBay. And I wouldn't risk a $400 investment for a $500 sale.

My items are often marked-up 10x-20x over cost, but it's relative. I'm not going to spend $0.50 for a $5 sale, but I'll spend $5 for a $50 sale. (I prefer the $0.50 for a $50 though )