Trying to understand selling fees. Help?

[choochoo510]

Haven't sold anything on Ebay in a long time, and just recently got back into it. I find the selling fees confusing, and pretty much deceitful. As an example, I'll use the latest low-cost item I sold. The item price was $4.99, shipping was $3.81, and sales tax was $0.26, for a total sale amount of $9.06.

Ebay's so-called "13%" final value fee (12.9% to be precise) is for some reason applied to ALL of that amount, shipping and tax included. Which means Ebay took $1.17 in fees for this order. (Then there's the extra fixed amount of $0.30 per order which they add on for fun, so the final fees were $1.47). The reason this is very strange to me is because the only amount I received on this order which can actually be called MINE is the item price of $4.99. The shipping money I received is not income for me, because obviously I have to pay back that exact amount in order to print a shipping label. And of course the sales tax is not part of my income either: that's just a tax the buyer paid to Ebay.

But nonetheless, Ebay is taking:

13% of the item price (which IS my money, so this makes sense).

13% of the shipping price (which is NOT my money, so this doesn't make sense).

13% of the sales tax (which is NOT my money, so this doesn't make sense).

So where is Ebay's 13% cut for shipping and sales tax actually coming from? It's ultimately coming out of the item price, the $4.99 I made on the item. And $1.17 is 23.5% of $4.99, not 13%. And again, once you factor in the $0.30 just-for-fun fee, then they took $1.47 which is 29.5%. This is the percentage Ebay actually takes from the sellers themselves.

Surely people have already pointed this out before. And I guess you just have to deal with it, or go sell stuff somewhere else. But it's pretty irritating that Ebay would advertise "13% selling fees," when in reality the percentage is more than double that, almost 30%. In my opinion, companies should have more respect for their users (and more self-respect for that matter). This legitimately has me wondering whether Ebay is worth using.

[babykisses]

Yes, I agree that the shipping price is too low. I usually go by the recommended prices that eBay states at the time of pricing, which right now is $4.50-5.00 for first class, so mine’s are 4.75 or $5. Now I know that any fees are not coming out of my purchase prices.

[dbfolks166mt]

I agree, it's simple. They take way more than 13% of a sellers' earnings. Sometimes as much as 29.5%. They know that I only paid 3.81 for shipping and that none of that is a profit for me. But they tax it anyway, so they can get a bigger piece of my overall earnings.

     In your example what eBay "took" was an effective rate of 16.7% of the Gross Revenue from the sale (Sale Price + Shipping). The gross revenue from this sale was $8.80 and is the tax reportable income that goes on your schedule C or schedule D. Had you not purchase the shipping through eBay your payout from eBay would have been $7.33. 

     Ebay does not know the "exact" amount of the shipping prior to the purchase of the label. The $3.81 was the estimated shipping cost to the buyer when they purchased the item and what the buyer paid. This is where eBay's "take" ends but where a lot of sellers want to continue using creative math to claim eBay's "take" is higher. In your case the claim of 29.5%. Your "take" on this item was $8.80 not $4.99.

     When you purchase the label through eBay they are serving as nothing more than a pass through for the money that goes to the carrier, USPS in your case, which is not owned by eBay. They have nothing to do with the shipping process other than serving as a bridge between the seller and the shipping service. The buyer paid $3.81 is part of your $8.80 gross revenue until you purchase the label which you can elect to do through eBay or outside of eBay. The actual cost of that shipping label is a deduction from your gross revenue. Claiming eBay's $1.47  equates to a "take" of  29.5% of your sale price of $4.99 is like claiming USPS's take of $3.81 in shipping costs is 76% of your sale price of $4.99. What USPS took was actually 43% of your gross revenue. 

     While I don't know the exact weight of your package as a side note using Pirate Ship which has discounted shipping rates that are close to and sometimes better than eBay's you could have shipped a 4 ounce package from your location in FL. to my location in VA for $3.48. The same 4 ounce package from your location in FL to CA would be $3.86.

[johnrj1226]

Read this link>>>  https://www.ebay.com/help/selling/fees-credits-invoices/selling-fees?id=4822&st=12&pos=1&query=Selli...     >>>> note that many of the selling categories  the fee is 12.9% + 30 cents but not all.  The link is  easy to  understand.  One need to clear there head of how it was done  yesterday or way back then -  as "That  Was Yesterday and Yesterday is Gone" - a phrase from a great song from 1964 and what  is fair and not fair - "It Is What It Is"  and until when  one becomes King of eBay it  ain't going to change - See " If Wishes Were Horses Beggars Would Ride".

Chad & Jeremy - Yesterday's Gone (1964) - YouTube

https://www.youtube.com › watch

[htownmma]

As a fairly new seller to Ebay this chat has helped us realize that we are one of many sellers that wish Ebay would be more up front about fees.. One of the first things I realized a few months ago was the 12.9 percent applied to everything and not just fvf then the thirty cent icing on the cake for each transaction. 

Ebay is the best marketplace for what we sell, but the way Ebay does the fees is what gets me too, the actual REAL percentage I wish was less but that bothers me less than how they go about the process, as I can see how it can seem deceitful for sure

[buyselljack2016]

I fail to see where deceit enters the picture

Final value fees

We charge one final value fee when your item sells, and you don't have to worry about third-party payment processing fees. This fee is calculated as a percentage of the total amount of the sale, plus $0.30 per order.

The total amount of the sale includes the item price, any handling charges, the shipping service the buyer selects, sales tax, and any other applicable fees.

[buyselljack2016]

 Forget about that 29.5%

Just wait.

If the $1.49 item sells, and goes to a location that charges sales tax on the shipping portion, the OP will be at a  70% of earnings taken by eBay for "fees".

[monroe67]

Just wondering how you send out those trading cards that you sell with "free shipping."  
Do you just put the card into a regular letter-sized envelope?  If the sealed envelope weighs less than one ounce, the current cost to send it within the US would be $0.60.   That kind of takes your item price down to $1.99, and that's before eBay charges its fee. 
Seems to me that any other method of sending one of those cards would almost completely wipe out any "profit" you might earn on a $2.59 item.  

Whenever my selling ID lists something with free shipping, she is careful to include the cost of postage in the price of the item.  That's why she only uses free shipping for very lightweight items that can be mailed with postage stamps and without tracking.  

[htownmma]

For cheap cards use Ebay standard shipping, it is tracked and scanned, I wouldn't use stamps, too risky

[choochoo510]

I agree! Also, I just now was looking at some shipping options for an item, and one of the options said next to it, "You save 13% on Ebay." That's the kind of thing that's deceitful. They expect people to see that and think it's actually a meaningful "saving," when in reality, it's the exact percentage they're going to turn around and take back from you based on your shipping cost.

[ten_o_nine]

I didn't read any responses yet, but who cares how much is being taking? sometimes you have to pay to get rid of items, the 30% ebay takes should be part of the asking price.

[choochoo510]

I'll be honest. I'm sure I read that exact explanation of FVF from Ebay before I ever sold anything, but it still didn't click for me what they were saying until I actually saw it in the breakdown of fees after a sale. It's clear enough, I'll give you that. But I'll also say, it's interesting how they express the shipping clause differently than the others. The other clauses use clearly monetary language: item PRICE, handling CHARGES, sales TAX, applicable FEES. The shipping clause says something more generic: "the shipping SERVICE," rather than something like shipping COST. Maybe I'm just being nitpicky there, but I do think when many people read over that explanation, it sounds reasonable enough at first, but once they can actually see what Ebay meant in their breakdown of fees after a sale, then they realize that Ebay is actually taking a lot more from them than they initially thought. I know that was my experience, and I feel confident it's the experience of many others too.

And consider how Ebay doesn't show people any fee breakdown examples which includes any emphasis on shipping costs. The only examples they show are "free shipping" examples, and they also use high-dollar amounts in the examples, so the percentages they take won't look so bad. They know what they're doing.

[tuscanybooks]

I believe eBay is moribund.  Many good dealers have quit selling on eBay due to eBay's rapaciousness and the unfairness with which they treat dealers.  This reduced the quality of items offered and as a consequence, many buyers--experienced and well-paying buyers who sought and knew the value of  good items--just left eBay  for good and we are stuck with bargain-hunting buyers who want to get an item for 10 dollars and  then turn around to sell it for $100 as I experience again and again. Items which I used to be able to sell for $30 or more I can't sell anymore even if I start them at 10 dollar.  The reason why I am quite certain that good buyers left is that hardly anyone looks at my items  any more even though they are just as good as when I started selling on eBay more than 25 years ago.

[htownmma]

It's not what they are taking, but how they are doing it

[pinky-lee43]

I do remember those days and those unscrupulous sellers, but I also remember eBay putting an end to it right away. It wasn't all sellers it was a hand full, it was annoying to the rest of us and it cost us sales and time especially since the majority of listing were auctions in those days. So no they are not making up for the lost income,  they were just fine once they put an end to those deceiving  listings. It was much different back when this whole platform started. There were listing fees, insertion fees, picture fees bold print fees, html fees,  and final value fees. You had to have a third party hosting site for pictures, you could not print postage easily (you had to figure the postage manually and enter into the listing) then print a 8X11 ebay label on your dot printer and tape it to the package.  It was early on and over time actually rather quickly as technology got better eBay dialed in on making the platform user friendly and really streamlined the tools that the sellers needed in order to get e-commerce off the ground.  As they grew and as things got figured out, the fees began to fall off. we got no insertion fees no listing fees no picture fees just final value fees and they added  shipping calculators and actual postage fee calculations from USPS Fed Ex and UPS and offered seller shipping discounts. It was all positive progressive change and it was a fun and happy place.  WHAT changed was the USPS postal service began raising postage cost every year, but we still got our discount,  we were lessening the postal counter service  workers workload and boosting their revenue all at the same time. eBay facilitated that change by negotiating with USPS for tracking and delivery confirmation on priority mail and other services not previously available. (That is a huge accomplishment) The other thing that changed was a few years ago the Government decided that we were having too much fun selling our used items and collectible junk to one another  so they decided they needed to collect sales tax on what used to be considered a "mail order business" and was not charged with sales tax unless sold with in the same state....Nope Uncle Sam decided that just didn't apply anymore because we were just having to much fun so they decided to tax internet sales with sales tax and tried to make each individual responsible for doing so even went as far as lowering the minimum taxable amount to be some where around what one might make selling their old junk at a garage sale. Each State that a seller shipped to was now expecting you to collect sales tax (at their rate) and send it to them for selling your used clothing and housewares to someone who needs it or wants it in their State!!!  When that idea went over like a lead balloon they decided it was the platform big guys that needed to figure the sales tax tables for each state and assess the appropriate tax, collect and send it to them for every sale. So now that does not sound like fun to me and yet here we are wondering why ebay is basing their cut  on the sales tax and postage without considering what ebay has done and is doing in respect to that tax collection and postage and handling.   They are charging a fee based on postage and tax , because they are providing the convenient means for sellers to print labels with postage from their platform and they are assuming responsibility for collecting and paying the sales tax to the individual states.  What I want to know is why the Government is driving our cost up for used items which were already taxed when they were bought new and why we are letting them get away with it and why they have to turn every fun progressive hobby and artistic outlet into a business so that they can collect sales tax all whilst not allowing us the benefits that huge corporations get to enjoy and why isn't it a good thing that people are finding entrepreneurship in e-commerce and getting a little enjoyment out of turning our trash into treasure and getting a little bit back for what we have already bought?  What did the government  do to earn their cut of a transaction that happens in cyberspace between two strangers that reside in different states?? 

[dryophelia]

@pinky-lee43 

Why are you paying for a store subscription?