Small time seller

[ardy01]

Hi all, I don't sell much on eBay but buy a fair bit. I just sold a Nikon Camera and separately a lens.

Didn't think too much about it until I added up the ebay costs and paypal costs.

I was surprised to put it mildly, the total % cost for sale was nearly 14%  - 10.9% ebay fees and 2.6% paypal fees.

My thought is how the hell do you guys make a dollar here?

Also won't be selling here again, I sold a bit about 8 years ago and don't remember it being this $$$ painful.

Good luck to all you sellers - you have gained my respect.

[chameleon54]

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@ardy01 wrote:

Chameleon: Had a look and was surprised that nothing was listed. I assume you do this for some money on the side?

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Hi ardy.... As Lyndal mentioned, I use the chameleon id as a forum posting id only. and don't sell on the id. Ebay was my main source of income for several years and I sold enough through the site to pay my mortgage, car regos, send the kids to private school etc. The business got to the point where I was having trouble keeping up on my own.

It reached the point where I had to make some tough decisions. Either continue to expand my ebay business and employ people to assist me or scale back to keep it under control. The Chinese where starting to produce cheap copies of the items I sold and ebay policies and direction where unpredictable, so I chose to scale back and start another business venture on the side. ( a prime lamb production business )

With hind sight, It would appear that the timing of starting the new business venture was fortuitous and things have fallen into place with that one. 

As a result I have scaled my ebay business back through natural attrition, lowering listing numbers from over 2500 to around 1700, spread across 3 ebay stores. I now spend around 2 full days a week on ebay but with recent improvements in sales could go full time again if necessary. With the lower Aussie dollar around 40 - 50% of my sales are coming from international sales and this is driving improved overall sales recently.

After all costs are taken into account, my accountants figures show I currently make around $35 per hour profit. When you consider this is done without any commute, sitting at home in my thongs and shorts, with river views from my office window, its not a bad way to make a living..

Ebay cops a lot of flack and it is true that some newer sites may be successful in selling some things ( particularly for local sales of larger, used items with local pick-ups ) , but for many smaller items and collectables, Ebay is still the Godzilla of selling sites with un-equeled global buyer numbers and simple selling systems.

[reallynicestamps]

@ardy01

We do have an auction house like you describe, and yes we do spend a lot of time preparing and shipping lots.

https://sparks-auctions.com/2019/08/27/sale-31-on-september-27th-28th-2019/

We also have online live bidding, and mail a paper catalogue to about 500 collectors. More use the online catalogue.

And our fees are 15% Buyer Premium and 15% Seller Premium with a $25 minimum. Buyer pays shipping cost.

So for all our work we are collecting something like 30% or more of the selling price.

A little over double eBay and Paypal fees combined.

But eBay has expenses we don't have including the cost of vast amount of server space for more than a billion listings a day, which they keep available for 90 days.

And a customer service staff which is bigger than ours (which is basically Kate and Stephane in addition to their other jobs).

And more IT guys (we have a Matt).

When we had a retail B&M shop, one block from Canada's Parliament Hill, we had a staff of ten running store, website, eBay and other online business, and the auction. Once we (semi)retired, we were able to cut back a bit.

But some months eBay was our biggest seller. Often it was the second biggest income.

[gutterpunkz05]

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@ardy01 wrote:

Hi Gutterpunk: I thought about this and what you say is true but ebay is not an auction house it is a market place to my mind.

They do not have people to pick the stuff up, phtograph it, display it and pack it up. They pay an auctioneer, bookeeper to handle the money, experts to ID stuff. That's off the top of my head from going to a few auctions.

I imagined ebay fees would be around 5% tops.

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Last year due to weekend promos,  I was able to reduce my combined ebay/paypal fees to 6%.  massive savings, and yes very happy.   But to expect ebay fees to be permanently set at 5%, is dreaming.

Ebay is a business, and unless they make a profit, then like all businesses,  they close up shop.

Ebay has massive overheads, that would make a traditional auction house  shudder.

For the service and reach that ebay provides, I reckon  10.9%  is pretty fair.  As for the paypal fees, I am more than happy to pay for the service, as it is the only form of payment I will accept.

I also deal with other traditional and online auction houses,on an almost daily basis, so yes I am more than happy with ebays fee structure.

[ardy01]

Thanks Guys, interesting insight into how you make a dollar here. The bit I was impressed with is the amount sold internationally. An unknown part of ebay I never expected.

Not sure I agree with ebays massive overheads, it is software mostly, I worked in that world for 20 years so I am skeptical of the costs. It has more to do with how they run the company than the size of the overheads. This software has been around in its basic form for a long while.

[max-power-models]

I've moved to FB.