Reality check? Fee percentage of selling price

[bluemorningglory]

I think that I am not offended by the amount of fees that are charged, but by how the fee structure is frustratingly hidden by Ebay/Paypal. I decided to sit down with a calculator, and find out how much (on average) fees are really costing me. I wanted an average percentage number, so that I could glance at an item while shopping, and say, "Ok, it will cost me this much to sell it. Is it worth buying it to sell on Ebay?"

Let's assume that I am a small seller without a store. I go to a yard sale, and buy some ordinary piece of trash, say the classic frog beanie baby. I intend to sell it on Ebay, and ship it in a small Priority Mail flat rate box. The buyer will use a credit card to send me the money via paypal. What percentage of my selling price will Ebay keep?

I decide to list the item for $10 with buyer paying shipping of $4.95. The auction ends with one bid. I "sold" my item for $10. What percentage of that $10 selling price did Ebay keep?

I started with the Ebay fee calculator, which states that Ebay fees for this item will be a mere $0.90, or 9% of the selling price. I follow a footnote to find that Ebay will also charge me a final value fee on shipping. That is another $0.45 in fees. Why did Ebay put in big bold numbers that my Ebay selling fee was only $0.90?

Next, I go to Paypal. After several frustrating page views, I find that I do not qualify for the 1.9% rate, but the 2.9% rate. This rate is applied to the entire amount sent to me, $14.95. Another $0.43 in fees. I also notice that this 2.9% is in addition to a flat fee of $0.30.

So, add it all up: 0.90 + 0.45 + 0.43 + 0.30 = $2.08

On an item which sold for $10, my selling fees were 21% of the selling price.

We have run several numbers through the calculators, and selling fees of about 20% of the selling price seems to be a fairly consistant estimate for my selling style.

Of course, you should try running a more typical item (high/low price, other categories) for items that you normally sell. For a $1 item with 50 cents shipping, your selling fees would be about 50% of the $1 selling price.

In general, fees would be about 12% of total amount (price plus shipping) sent by seller, plus 30 cents.

[daveroo]

Nice piece of work.

I personally try NOT to list anything that will sell for less than $20.

I just group items if necessary to reach that level.

And I generally start them at $20 just to make sure.

[nuvistors]

My local auction house charges 25% commision plus  a 10% buyers premium (auctioneers profit)    That is quite a bit more than the ebay fees.

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[dafoos60]

Ebay charges a listing fee, in your case of $10.00, the fee would be .50.  Then they take a percentage of the postage fee.  Then the final value fee (what the item actually sells for) of 9%.  And I think Paypal (Ebay) has their fingers in there too.

[mahmud55]

so are you saying that if i sell something for $10 with free shipping, then ebay and paypal (together) will take 21% of my $10 profit. OR are you saying that if i sell something for $10 then ebay and paypal will take 12% of my $10 profit.

[goeasygo]

so are you saying that if i sell something for $10 with free shipping, then ebay and paypal (together) will take 21% of my $10 profit. OR are you saying that if i sell something for $10 then ebay and paypal will take 12% of my $10 profit.

If the OP paid $2 for the beanie baby and sold it for $10 and gave free shipping @ the cost of $4.95 he doesn't come anywhere near a $10 profit.

The OP comes out with a $3.05 profit which ebay/paypal will take about $1.90.  Free shipping is only free to the buyer as someone has to pay for it.

If it's not built into the starting price, it comes out of the sellers profit, which in this case is just about zero. 

[redbud_farm]

I use auction houses and eBay a lot.  Once again,  NO one pays a sellers commission and a buyer's premium on the same item at an auction house.   One is paid by the seller and the other is paid by the buyer.  A 20-25% seller's commission at an auction house is very comparable to total amount of fees paid to eBay and PayPal to sell an item on their site. 

auctions with buyer premium find sellers in the long run pay it with reduced bids. buyers reduce what they'll pay by the % charged.

starting items with the profit and shipping built into start is the lesws riskiest way here.

but then i buy here to resell locally , so do as ebay suggests , free shipping and 99 cent start

[zarihs2010]

sold my camera on ebay today for £450, Ebay chaged me £45 and paypal £16 The postage was around £24 so adding them come to >: £85   Just should say  WTF

[jda02121]

Love sellers that come here and calculate the costs AFTER making a sale. Then blame eBay/Paypal. Priceless.

If you can't make a reasonable profit and/or don't like the fee structure find something else to do with your time.

[tidewater7]

Well said

[scribble_on]

IMO, Ebay is no longer the place to buy/sell inexpensive yard sale stuff, which is a shame, because you used to be able to get good deals here, and the sellers could make a little money, too. 

I list much less than I used to, and only things I can make at least 30-40 bucks per item.  It just isn’t worth all the work otherwise.  Also, inexpensive items tend to draw sleazy customers, such as those who buy things like, say, trading cards, and repeatedly complain about bad packaging, and want refunds w/o sending the items back. 

I don’t mind that the fees are “backloaded,” though, because when the insertion/picture fees are low/free, I don’t lose money if I start an item at a higher price and it doesn’t sell.  I either wait a couple weeks until it falls off the search, and relist it, or just sell it in my B&M. 

What I do find obnoxious is charging a % of the shipping cost.

[**injeanious]

What I do find obnoxious is charging a % of the shipping cost.

Absolutely, it's as if eBay/PayPal give themselves a free bonus while the seller does all the work.  I wonder if eBay returns their "bonus" if a seller is forced to repay an unhappy buyer 100%.

[stinky*felix]

The thing that bothers me about that most is it is not an equitable system.  A seller who ships an heavy item will pay a higher FVF than one who ships a lighter item (in most cases). 

And sellers who ship time-sensitive items such as event tickets  (or other items) and use Express Mail really gets taken.

It seems wrong to penalize someone for providing exceptional service.

[stinky*felix]

Ack!  Badly written, but you get the idea.  😐

[ran*the*man]

Interesting thread.