Do the math – what will the fee changes cost you? By Mike Alvero | Posted February 27th, 2008
The recent fee changes introduced by eBay have created a firestorm among sellers.
While eBay has given with one hand — by lowering insertion fees and eliminating the basic Gallery fee — it has taken away with the other, by increasing Final Value fees.
As you’ve seen, there have also been changes to the prices of more advanced features, such as Featured Plus!, Pro Pack, and Homepage Featured.
eBay says the changes will reduce the upfront risk of listing an item and reward successful sellers. But many sellers believe the changes, particularly higher Final Value fees, will hurt their profits.
Here’s a breakdown.
1. It will cost you less to list your items for sale on eBay
Basic insertion fees have been reduced by as much as 50%, depending on the type of listing and the starting or reserve price.
For example, here’s what the insertion fees for auction-style listings look like now:
|
Starting or Reserve Price
|
Old Insertion Fee
|
New Insertion Fee
|
New Insertion Fee for Books, Music, DVDs & Movies, Video Games
|
| $0.01 – $0.99 | $0.20 | $0.15 | $0.10 |
| $1.00 – $9.99 | $0.40 | $0.35 | $0.25 |
| $10.00 – $24.99 | $0.60 | $0.55 | $0.35 |
| $25.00 – $49.99 | $1.20 | $1.00 | $1.00 |
| $50.00 – $199.99 | $2.40 | $2.00 | $2.00 |
| $200.00 – $499.99 | $3.60 | $3.00 | $3.00 |
| $500.00 or more | $4.80 | $4.00 | $4.00 |
Click here for full details of the new insertion fees.
2. It’s now free to include a picture in your listings
eBay has eliminated the basic Gallery fee for all types of listings and it has lowered other Gallery fees such as Gallery Plus and Picture Pack.
Click here for full details of this, and the fee changes for advanced options.
3. You’ll pay eBay more when you sell an item
Here’s what’s got eBay sellers up in arms: higher Final Value fees.
The amount you’ll pay will continue to depend on the type of listing and sale price, but eBay has increased its cut dramatically.
For example, if you sell an auction-style or fixed-price item for $25 or less, you now pay eBay 8.75% of the closing value — up from 5.25%.
Click here for a full breakdown of the changes.
Let’s see how all this works in practice…
Suppose you sell a pair of shoes for $60 in a fixed-price listing that includes a picture.
Before:
$2.40 (insertion fee)
$0.35 (Gallery fee)
$1.31 (5.25% of the initial $25.00 of the closing value)
$1.14 (3.25% of the remaining $35.00 closing balance)
$4.90 (Total amount you pay eBay)
After:
$2.00 (insertion fee)
$0.00 (Gallery fee)
$2.19 (8.75% of the initial $25.00 of the closing value)
$1.22 (3.50% of the remaining $35.00 closing balance)
$5.41 (Total amount you pay eBay)
Media sellers pay less
Although eBay is lowering its insertion fees for almost all types of listings, the biggest percentage reductions are for Books, Music, DVDs, Movies, and Video Games. (Perhaps eBay is worried about sellers moving to Amazon.)
Suppose you sell a CD for $15 in a fixed-price listing that includes a picture.
Before:
$0.60 (insertion fee)
$0.35 (Gallery fee)
$0.79 (5.25% of the $15.00 closing value)
$1.74 (Total amount you pay eBay)
After:
$0.35 (insertion fee)
$0.00 (Gallery fee)
$1.31 (8.75% of the $15.00 closing value)
$1.66 (Total amount you pay eBay)
What’s your reaction?
Some sellers reacted by boycotting eBay last week. This appears to have had some effect. The number of eBay auctions dropped from 14.5 million on February 18 to under 11.9 million on February 21, according to Medved.net.
How will the changes affect your business on eBay? Did you take part in the boycott? Let us know.
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