eBay Is Changing Its Fee Structure--Again
Is it just me, or are you tired of eBay changing its seller fee structure every few months? As an occasionally eBay seller, mostly of brand-name clothes that I find myself not wearing because they don't fit quite right, I feel like I've barely gotten used to one change when the fees change yet again. It seems like the overall trend is for insertion fees (the up-front fee you pay when you list an item) to go down, while final value fees (the fee you pay when the item sells) are going up. (I haven't carefully analyzed this statement, it's just my general impression as it applies to the stuff I sell most often.) This strategy seems designed to attract new sellers to eBay by marketing the site as a no-risk way to try to make some extra cash. Perhaps that's a good idea, but it's driving me, an eBay user of ten years, a little bit crazy.The newest changes will take effect March 30. It will become free to list up to 100 items per month using the auction format and a start price of less than $1. I know this is supposed to be the way to go when you sell on eBay, but I don't like listing my clothes for 99 cents, because sometimes they sell for 99 cents, and then I'm losing money. The final value fee is increasing to 9% with a cap of $50 per sale.
eBay says that "For most sellers, the new fee options will bring significant savings with dramatically reduced upfront cost. Across the board, Insertion Fees are being dramatically reduced. Final Value Fees for Fixed Price listings are for the most part staying the same." Let's calculate if that will be true for me. I like to list items with a start price of $4.99 to $9.99 and they usually sell for about what I've listed them at.
Here are the current fees:
Auction-style listing fees
Your first five single-quantity auction-style listings to be listed on the site in a 30-day period have an insertion fee of $0.00 for eligible categories.* (See Insertion fees for more information.) These $0.00 insertion fee listings also have a final value fee per listing of 8.75% or $20, whichever is lower. Additional listings within the 30-day period and multi-quantity listings are subject to the following insertion fees and final value fees.
Current Insertion fees: Auction-style listings
Starting or reserve price | Insertion fee: Books, Music, DVDs & Movies, Video Games | Insertion fee: Other categories |
$0.01 - $0.99** | $0.10 | $0.15 |
$1.00 - $9.99 | $0.25 | $0.35 |
$10.00 - $24.99 | $0.35 | $0.55 |
$25.00 - $49.99 | $1.00 | $1.00 |
$50.00 - $199.99 | $2.00 | $2.00 |
$200.00 - $499.99 | $3.00 | $3.00 |
$500.00 or more | $4.00 | $4.00 |
Currently, I'm paying nothing on my first five listings per month and 35 cents per listing thereafter. I've been taking advantage of this fee structure by only listing 5 items a month and if they don't sell, waiting until the next month to relist them. (Maybe eBay doesn't like that.) If my item sells for $9.99, the final value fee is 8.75%, so my total fee comes to 87 cents per item if I list five items for $9.99 and they all sell for $9.99. This is an oversimplification, yes, but my real numbers are pretty close to these.
Now let's see what will happen to me under the new fee structure:
New Insertion fees: Auction-style listings (effective March 30)
| Starting Price | Insertion Fees |
| $0.01–$0.99 | FREE!* |
| $1.00–$9.99 | $0.25 |
| $10.00–$24.99 | $0.50 |
| $25.00–$49.99 | $0.75 |
| $50.00–$199.99 | $1.00 |
| $200+ | $2.00 |
Under the new fee structure, if I continue to list five items per month with a starting price of $9.99, I'll pay $1.25 to list them plus 90 cents for each item that sells (9% final value fee). Clearly, this new fee structure does not benefit me. If I keep my selling behavior the same, I'll pay an extra $1.40 a month to sell 5 clothing items with a start price of $9.99 and a final value of $9.99.
Well, economics is all about incentives, so how might eBay be trying to use its new pricing structure to give me an incentive to change my behavior?
-eBay would like me to list more than five items per month.
-eBay would like me to list my items with a start price of 99 cents.
eBay thinks I will be more successful this way, and that, therefore, it will also be more successful. The more I sell and the higher my final value fees, the more money eBay makes.
But, since I don't want to list my clothes for 99 cents, eBay is instead giving me an incentive to hurry up and list all the clothes I want to sell before March 30.
For complete details on the new fees, visit eBay's fee update page.
What's your take on the new eBay fees?
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Post by Amy Fontinelle
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