Is eBay keeping USPS shipping discounts instead of passing to sellers?

[vintagequeennyc]

If you’ve been selling online for a while, you know that all major selling sites have worked out a deal with USPS for shipping rates that are lower than the commercial rates. Yet, for some reason, eBay, the 2nd largest online site hasn’t been able to work out a better deal for its sellers. OR HAVE THEY???

I have heard a rumor from a credible source (which was told to them by eBay employees), that eBay HAS negotiated a lower shipping rate but they are pocketing the money instead of passing on that lower rate to sellers. 

If this is true, it is beyond awful on the part of eBay. Truly nefarious and scummy. 

It’s no secret to any of us who have been here for a while that eBay is going downhill VERY rapidly. Revenue is plummeting. Fees keep going up. Search algorithm is beyond broken. 

I just had my worst 2 weeks in sales since I started selling on eBay 12 years ago. I sold two items in ten days. This is wa outside the normal ebb and flow. And in 2018 my sales dropped by 50% when they rolled out the new algorithm. 

I truly believe the terrible management at eBay is destroying this selling platform. It just shows you how desperate they are if they ARE pocketing a shipping discount instead of sharing with sellers in order to drive lower prices and sales and increase competition with Amazon. 

[drusalina]

I believe that PayPal gives you the same discount as eBay, and the USPS for Commercial Rates.  When I compared First Class Mail labels on eBay and Pay Pal they were the same.

If you Print your  own labels from the USPS (you  have to have an account) you get a discount.  

I have never understood why sellers use all those other sites, when I think it is all the same commercial rate discount that the USPS gives.   Plus some of those other sites charge you to use their printing services.  Am I wrong?

[lintbrush*]

@southern*sweet*tea 

Take a look at those shipping transactions again.  They are to eBay Inc. Shipping.

And I'm quite confident that eBay has better negotiated rates.   If they didn't, I don't see them passing along any additional savings to TRS which they are now doing above the published rates.  Before the hike, the rates were the same as the published ones.

[ozarkjoe]

I am not sure how USPS sets rates and discounts based on distance and region, however I don't see the big discounts that I have seen in the past.  I have used Priority Mail and seen the discount here be as high as 50%.  Last week the discount was around 10%.

[vintagequeennyc]

BINGO. 

I have info info from a very reliable source connected with eBay shipping that eBay HAS negotiated a lower rate with USPS and are pocketing that money instead of passing the discount along to us. These eBay insiders also expressed their dismay at this practice but that their hands are tied up upper execs to do anything about it. 

I truly believe the increase in seller fees (let’s not even get started on that bogus high return metrics %4 fee) is how eBay is propping up falling revenue in quarterly reports. I mean, yes, we all know they make all their money from fees, but I think it’s pretty clear to most people who don’t have their head in the sand that actual transactions on the site are in a free fall. I’ve been tracking sell-through rates in several areas over the past year. Many are down significantly.  So how does eBay make up the difference? Higher and more egregious seller fees. 

Mark my words. We’re going to get hit with a seller update soon and I’m willing to bet money it will include some type of fee increase. 

Ebay would rather tax its sellers out of business than lower fees and shipping in order to bring back both sellers and buyers. 

Also, make no mistake that they have special deals worked out with the big sellers on many things. The big sellers are not subject to the same rules and fees as mid to small sellers. I truly believe eBay wants to get rid of the rest of us and are doing everything they can to force out the little guys in order to fulfill their eBay catalog mumbo jumbo dreams. 

[dhbookds]

If I arrange a lower costs with my supplier of widgets, does my buyer deserve a lower cost? 

Certainly my buyer can shop for a lower cost........but he shouldn't expect a lower price from me.........

============

We are certainly free to find and use lower cost shippers if we can find them......  but to expect ebay to find a "one size fits all" shipping rate for buyers is pie in the sky...... 

[yuzuha]

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@the*dog*ate*my*tablecloth wrote:

From what I've read, Poshmark negotiated a flat rate label that is the average price of shipping for items under 5 pounds. They are not actually getting a discount or giving one to sellers. Since everyone has to use the labels, the people selling light stuff like tee shirts are subsidizing people who sell heavier stuff like shoes.

Can you imagine if Ebay tried to force First Class shipping sellers to ship for $6.49 Priority on every order? There would be a mutiny.

Not to mention the fact that since only part of Ebay sales are clothing, it's a good bet their cost to ship items under 5 pounds would average out higher than Poshmark.

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Exactly.  I would NEVER want eBay to do its shipping like Poshmark because that would absolutely kill my business.  Most of my things are lightweight items that cost less than $4 to ship.   No one would pay $6.95 to have a 2 oz keychain shipped to them, but they will pay $3.50 for it.

[mg152]

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@the*dog*ate*my*tablecloth wrote:

From what I've read, Poshmark negotiated a flat rate label that is the average price of shipping for items under 5 pounds. They are not actually getting a discount or giving one to sellers. Since everyone has to use the labels, the people selling light stuff like tee shirts are subsidizing people who sell heavier stuff like shoes.

Can you imagine if Ebay tried to force First Class shipping sellers to ship for $6.49 Priority on every order? There would be a mutiny.

Not to mention the fact that since only part of Ebay sales are clothing, it's a good bet their cost to ship items under 5 pounds would average out higher than Poshmark.

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I’ve sold on Posh but I’ve only bought one item. It was a 3 Oz item and I paid $6.49 shipping. It’s crazy. It doesn’t matter if the item is 2 Oz or 5 lbs, shipping is $6.49 so it evens out for the USPS.

[mg152]

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@the*dog*ate*my*tablecloth wrote:

I think you may feel differently if you sold light items on Poshmark but still had to pay $6.49 for shipping. I'm surprised the buyers pay that shipping for light items without complaint.

Poshmark and Mercari seem to be sales and shipping for the common person. Like Mary wants to sell her Northface. They simplify sales and shipping as much as possible. That is not the target audience for Ebay, most of their sellers know how to squeeze every penny out of a sale. 

I have no idea how the shipping at Amazon is priced but they DO sell their own items so they're different from these other sites.

And I expect this is all different under Managed Payments. Doesn't the shipping come out of the seller account there?

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Buyers on Posh have disposable income and they don’t mind overpaying for shipping. I’ve sold many items there from small to large and not 1 person complained about the shipping cost. They know going in that it’s gonna cost $6.49 and they just don’t care. The buyers there are mostly young professionals that have the cash to spend and want to spend it. It’s a whole different vibe from eBay but it’s a more social site too and rhats just not my thing. You really have to participate and coddle buyers. I finally just took the rest of my listings off there. I was spending hours everyday “chatting”, sharing, attending “parties” etc....

[vintagequeennyc]

Agreed. But no one is saying for them to do it exactly like Posh. It’s just an example that online retailers ARE negotiating lower rates with USPS yet eBay has strangely stayed silent on this issue.

But a percentage discount per weight class would almost certainly be welcome by everyone. It’s hard to imagine that USPS would offer volume pricing the 2nd largest online retailer (even if it is still 40% below Amazon volume.)

[yuzuha]

Poshmark isn't using a negotiated rate, though; they're simply doing what a lot of online retailers do and offering a flat rate for shipping.  As has already been said, they can afford to do it because the overage on the lightweight items pays for the money they lose on the heavier ones.  Many websites handle their shipping this way and it's not because they have any sort of special discount from the USPS/UPS/whatever they use.  That was how my old B&M job's online sales worked-- they had one shipping rate for everything, so you paid $8 whether you bought a single piece of jewelry or a large, heavy figurine.  They sold a lot of small, lightweight things so they could afford to foot the bill for the shipping on the heavier ones.

[moo*cow*corner]

---General Reply---
I ship things that weigh from 1 oz. to over 50 lbs. A system like Posh has would NOT work for those of us that regularly ship heavy things.

It's already bad enough that ebay took the larger boxes and cubes out of the shipping supplies store. The way it is now, there's nothing in there I want or need. Yet I still pay the same monthly store fee as everyone else.

Sell in my category for a while -Pottery & Glass. The ballpark figure in my head is $10 postage for every box that goes out the door. Many are MUCH more.

Why does anyone think they are entitled to have any discount passed on to them? Every aspect of a business should be making money. Stamps.com, Esty, Amazon, Endicia, Pitney Bowes etc. --All of them make money on postage. Why else be in business at all, except to make money?

Once I figure out a way to monetize my coffeemaker, I'll be rich! Well, I haven't figured out a way, so I roll $0.02 into my asking prices to cover having coffee available at all times while I work. It's critical to running my business, I tell ya!  Lesson: the end consumer always pays-- for everything.

I don't have any problems with the prices of labels. I remember the old days...hand written labels, separate Delivery Confirmation and Insurance forms and stickers, standing in line at the PO, no convenient drop offs for other carriers, the whole works. Shipping used to be a royal PITA, every single day. To me, ecommerce mailing labels are stupid easy and convenient. They are well worth the cost, IMO.

I buy very few ebay labels, but I get it. I think they are the best thing since sliced bread for low volume, hobby or casual sellers. I use a 3rd party shipping program, and happily pay the monthly fee, in addition to postage.

[robot-hands]

If true I would have to re-think my stance that ebay is run by fools.

I would have to applaud that kind of deal, it's masterful really.

[myjunqueyourtreasure]

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@vintagequeennyc wrote:

I might have misunderstood you, but the difference in shipping between Posh and eBay is that the buyer pays for shipping AND there are no fees deducted from the seller’s earnings for shipping. The ONLY exception is if a seller chooses to offer a shipping discount, then they would pay that cost. But that is not the norm. Most of my buyers pay the $6.49 rate. So it’s different from eBay in that as a seller, I’m not ‘paying’ $6.49 to ship a 9oz item. The buyer is. It doesn’t affect my earnings or sale price. 

I think it also shows that buyers ARE willing to pay for shipping, unlike what eBay would have us believe. 

As for managed payments, yes, the shipping cost is processed through that too. Not PayPal. 

I think ultimately we both probably agree though that shipping rates are most likely hurting eBay sellers overall. I still believe that there must be a way for eBay to somehow negotiate better rates (again, assuming they haven’t already and are keeping the money.) Even a 10% discount per weight class would be big. But then again, the fact that eBay charges a FVF on shipping is most likely another main reason they haven’t secured better shipping rates. 

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AFAIK MP sellers till have to purchase their ebay labels through PP.

[cashvaluerecovery2011]

Just a very short few years ago I shipped a single coin in bubble wrap envelope for $1.91 anywhere in the US. 2 years ago it was $2.45. Last year $2.68. Today it was $3.22 to go 3 states away. I just shipped a 1lb 2 oz auto part that fit in an bubble wrap envelope 3 states away. Cost $9.46 through ebay. Yet I sent 67 lbs in  boxe to the river 4 states away and it cost me $11.42. The logical answer is simple here folks. Ebay wants us the seller to do anything possible to make prices cheaper for the buyer to induce a purchase. No more top rated discounts. Hike in fees. Offering buyers constant spam emails for discounts and lower prices..........all while telling us sellers to lower prices more. While ebay takes no cuts every and looks for ways to increase their own profits.

YET ebay charges me $9.46 for 1lb 2 oz to go 3 states the river charges $11.42 for 67 lbs about the same distance.

The river will lose profit to gain market share and make a buyer happy because they make plenty of money and look at it as buying business. Ebay ruins its sellers, takes every dime, throws pennies at buyers, and expects the sinking ship to rise on its own.

Yes Ebay makes money on shipping. They are the 2nd largest ecommerce site out there. They cant possibly be bad enough business people to not have negotiated a sweet heart deal with usps. If they havent then that also explains a lot. The fact they charge us FVF on shipping = all you need to know about how they feel about sellers.

[disneyshopper]

AFAIK MP sellers till have to purchase their ebay labels through PP.

That is correct.  I had to ask on these boards how to add money to my Paypal account because in 18 years of selling, I have never had to ADD money to my Paypal account.  As I made sales, the postage came out of those sales.

But with Managed Payments, the payments go into my bank account, but the shipping for ebay labels still comes out of Paypal.