Selling for others on commission - Help

[brucelovestheocean]

Hello,

I read a few old posts in this community about what sellers charge private clients to sell their items. Some content is quite dated. 

I have been selling for people in my community for a few years and would like to hear some current feedback from people like me who sell for clients on a commission basis.

Initially I was charging 35% after all fees are extracted. Buyer, 90% of the time, is paying for ship cost. So the fees extracted are eBay fees.

I am a one man show and as you are well aware - it’s a LOT of work. I also post many things which I see a zero return on also.

I have seen commissions in some posts where the seller charges 50%. That’s a bit to high for me to charge my clients. I’m trying to find a happy medium, if there is such a thing.

I just raised my commission to 40% but fear I might scare off some potential clients. Most of the items I sell are under $100.00 with some priced higher. I sell some in the range of $100.00 - $500.00 as well and I have a smattering of $1,000.00 and up. But I would say 90% of my items are in the lower range and run the gamut.

I’ve been tossing around the idea of a tiered structure as well. But not sure how I would create that structure. 

Due to current COVID climate selling on eBay has turned into a full time job. And in truth I find myself working a majority of my time. Which is ok. I’m just thankful I have this as a means to support myself.

So I would love to hear from fellow sellers some of your thoughts about how you charge your clients and also your thoughts on how to construct  a fair tiered commission structure.

in the meantime is 40% to much to charge? I don’t want to gouge my clients or scare them away, but most folks have no idea about what it takes to list an item on eBay. And more importantly what it takes to list lots of items and then manage everything.

Your thoughts are deeply appreciated.

Wishing you a Merry Christmas! 

Bruce

[little*blackdog]

First of all, poster genv  couldn't be more "on the money"!  Everything said in that response is correct and true.

I list things for family and select friends, and after fees, I give them 50% of sale proceeds only.  And that is with the understanding that if there is a problem in the future, (chargeback, refund, etc.), they will give the money needed to make it right, back to me!  I refuse to be the one holding the bag if disaster strikes!

The shipping amounts that the buyer pays, I keep, plus a handling charge in some cases. I pay the costs of the label and if there's anything left over because of label discounts, etc, I've earned it by having all packing materials in storage, packing, physically taking packages to the shipper, etc.  I don't feel guilty about making a couple bucks on the shipping amount, ever.  I've had plenty of delicate items that took a hour or longer to pack, and packing materials aren't cheap either.  You should be keeping every cent of what the buyer pays in shipping, and adding a "handling fee" when appropriate as well (in addition to the shipping amount in the eBay listing form).

There is the tax angle which is a negative for you if you are claiming everything as income.  You should be giving customers an invoice showing details, so YOU can claim costs against what you earned doing all the work.  You are providing a service, and you have costs... the 50% you give back is part of those costs.

Re "doing all the work"... the responder who suggested giving eBay listing lessons for $25 an hour had the right answer.  If your customers aren't happy with 50% of the final profit, (not including shipping receipts), then they can sell it themselves. 

There IS a lot of potential long-term loss for you too, which as an agent, you currently aren't getting compensated for.  The PayPal and eBay Buyer Protection claim time frames are waaay too long for your head to be on the block that long, just waiting for the axe to fall!  You need to think of a way to protect yourself from those kinds of losses, whether it's higher fees up front, or a "call-back" clause in your contract with the owner of the item. 

Also, you need to "just say no" to any junk people might bring you.  Be selective.  You aren't a free storage facility, and the things they bring should be things that will sell quickly and at a decent profit for you, or WHY DO IT?  You should quickly research every item they bring you, on eBay and elsewhere if you have the time, but especially on eBay... see what similar items have sold for... see if there is potential profit in the item.  If not, refuse it.

You are on the right track, but sounds like you could be making a lot more money in exchange for your efforts AND KNOWLEDGE.

[buyselljack2016]

I have sold for others in the past, but not much.

Sold 2-3 things for close family friends at a 0% basis. Just covered the fees.

Sold some for an individual, and did not charge nearly enough. Not a loss, but hardly worth my time

That individual approached me again about selling for him.  He had retired, and was interested in selling his tools.

If I were to do it again it would be for a %age on lower price items, but to be fair there would be a cap on higher priced.  There would be no more work for me to list, sell, ship a $500 grouping of tools than a $100 grouping, so for me to charge that big %age on the higher item would not be fair.

Anyway, I did not take the offer.  I did tell him that I would have to charge more than last time, and suggested he sell it locally, or wherever as "a lot".

Other option would have been for me to buy it all, and then list rather than as a "consignment".

[calntom]

EBay fee, payment processing and shipping are about 20-22% of the average transaction. I take 40% and customer gets 40%.

If the customer wants to be paid in cash, I take 20% of their 40% for income taxes.

Items have to sell for $100 if I expect to realistically make any money worth noting. eBay is labor entensive unless you have large quantities of same or very similar items. 

Item must be in my possession before I list it.

[lamber9347]

@brucelovestheocean I believe this is a decision that everyone needs to make on their own. I've been selling items for close friends for several years now. I charge 20% AFTER all fees are deducted. I keep a spreadsheet on excel for each of them. Currently I have seven people I do this for. 

Each one has been very happy and usually try to give me more items to sell. I tend to say no because I actually want to do this for fun and not a business, although I am making plenty of money doing this. I have three others which I sold every single one of their items and decided not to take on more because word of mouth spread too far for my sales. I literally was selling too much for what I wanted. 

It remains fun for me and I enjoy myself plus make my friends happy and we all make some extra money. If I have a return I charge them for any return label or associated fees. It's part of selling online and they all understand. Best of luck to you.... 

[southern*sweet*tea]

If you think the items are worth selling, and you can get them at a good price, buy them outright for cash then resell them.

Otherwise, I don't think I'd bother selling for someone else, especially when the money isn't safe for 180 days. It can be risky enough selling your own stuff, much less someone else's.

[divwido]

I only sell for my husband's business and my mothers estate. It's too much work not to kee 100%.

Luckily, I have so much inventory, I cannot even find room to store all of it.

[chapeau-noir]

I've done consignments for 20 years with no problems.  Don't make simple things complicated is probably my best advice.

[farmalljr]

Personally, I would not sell on consignment. To get people to agree to the right terms, isn't an easy task. To cover yourself, a consigner would need to sign a contract. This would cover you both ways ideally, from both the consignor and the end buyer. 

How much paperwork and book keeping do you really want to do? Did you start this business to sell stuff and make a profit, or did you start this business because you LOVE paperwork?

For me it's MUCH easier to just buy stuff outright at a price I'm willing to pay. I take all the risk, I make all the profit. The only people involved in the deal is me and the buyer. 

Far too many people see the prices something is LISTED for, and think that's what it's worth. They don't understand how eBay ACTUALLY works, or the risks. I prefer to just buy stuff outright on the cheap, from people who want to get RID of stuff. And I don't gamble money/sales on high dollar items that are targets of scammers. I'd rather make $10 profit and keep it, rather than deal with a sale for hundreds of dollars and risk losing it all. Consigning someone's stuff, is likely to involve dealing with high dollar items that are targets of scams. 

Perhaps not the answer the OP was looking for, but IMO a bit wiser response to protect one's business. Instead of looking to consign, maybe you should be looking to buy stuff outright. There are less hassles in it. Lots of people willing to sell stuff for cash (as they need cash more than stuff) or they are just looking to clear the clutter. 

[liawrig.nq8rdwqa3]

I sold a few things for friends.  I list it online at Ebay and/or Amazon.  When it sells, I take 50% of whatever revenue is.  So if the Profit is $10, I take $5.  I factor in the shipping and fees and that's how I came up with 50%.  I'm doing the work, taking pictures, description, shipping, etc.  A consignment shop takes 50% and they don't do that.

[plymouthsales4165]

I wouldn't do personal consignment, corporate consignment on the other had works well. Most companies just want the gone and will not hassle you at all about selling price. We use a 50-50 split after fees, provide a spread sheet and a 30-60-90 program with a buy out /scrap/ or donate at our choosing after 90 (on some really expensive items we will go out to 180 days). We use a different ID for each consignment deal so we know the exact fees, sales, shipping and such. Shipping to us is charged off as a fee. The huge upside is you can get a flow of items without tying up money in inventory

[robon3092]

What do you think about self-service data analytics and visualization tools?

[jklfindings]

I used to run ebay accounts for 2 jewelry stores in my area selling estate items.  Prices could range from $2 to $20,000.  I found that the easiest way to charge was to do an upfront fee per listing (I did $10 per listing) plus a percentage fee based on what the item sold for.  If it never sold, I still got paid something for my time.  My percentage fee was also on a sliding scale.  It started at 30% for anything under $100, and went down the higher the item value.  The client also paid for all shipping / insurance / ebay fees / paypal fees.  If the client decided a week later that they didn't want to sell the item any longer, I charged a fee to remove the listing.  I took all pictures, did research on the items,  wrote all descriptions, shipped, etc.   So all the client had to do was provide what they wanted to sell.

[nuvistors]

Now, we'll only do this for close friends and family. If we were to charge a stranger to do it, we'd probably ask for 60 - 70% of the sale price. Almost double what you're asking.

+++++++++++++++++++++

That is  extremely  high considering all the whining  we have heard about the fees that ebay charges.

[tools*]

I've only ever sold two things on eBay for someone else. A dealer friend asked me to sell a rare set of toy soldiers (Warrens) for $5,000 and an original 16x20 Nan Golden photographic print for $1,000. I only charged him 20% after fees, but a $1,200 commission for a few hours of my time isn't bad. In fact, the buyer of the toy soldiers picked them up and gave me cash which made the sale even easier.

In general, 40% after fees is realistic for something in the $100-500 range. 30% after fees for items $1,000+ seems fair to me, and I would only take special things that I know will sell easily.

[robon3092]

I found only tropare tools