eBay to cut listing fees to stay competitive

Filed under: Business, Internet, Web services

eBay to cut listing fees to stay competitive

by Brad Linder Jan 29th 2008

Want to sell some old junk lying around the house on eBay, but don't feel like putting up with listing fees? The company has announced plans to cut listing fees by up to 50 percent.

The cuts aren't across the board. In fact, some fees will be raised. For example, if your items sells for less than $25, you'll now be charged 8.75%, which is a 67% increase.

The new fees take effect on February 20th and are aimed at the US, although eBay plans to announce rate changes in the uK and Germany soon. The move comes at a time when eBay is struggling with flattening growth and competition from other online auction sites.

Do you still use eBay to buy and sell new and used items? Or have you started turning to other auction sites? What do you think of eBay's current listing and transaction fees?

Tags: auction, auctions, ebay, fees

Reader Comments (Page 1 of 1)

Josh said 5:29PM on 1-29-2008

No matter what your item sells for you will pay a much higher percentage on the first $25 dollars, as well as a higher fee on the money between $25 dollars and ~$1000.

This is actually a fee increase overall, even for items listed with extremely high reserves.

Ian said 6:36PM on 1-29-2008

My anger with ebay has been rising lately due to the ridiculous S&H charges being charged by most vendors. I went looking for a replacement Li-ion battery for a silly video keychain (don't ask), and one seller was asking $25 in S&H charges -- on an $8 battery that weighs literally less than an ounce.

Once ebay reigns in that kind of ridiculous mark-up, I'll be using it again. (After all, I used to go rely on ebay to escape the 300% markups in retail stores).

Matt said 5:56AM on 2-13-2008

What you experienced (high s+h compared to selling price) is actually against the eBay rules, but it's how many sellers stay in business. eBay only charges seller's an 8.75% "final value fee" on the sale price, not on the shipping though. (This 8.75% fee is on top of the insertion fee and gallery fee and extra sub-title fee, etc.)

Often, if a seller is selling a battery, for example, that Best Buy sells for $49.99 + tax, the seller might sell it for $8.00 with 25.00 s+h for a total of 34.00. Still $16.00 less than Best Buy (33% off.) The seller pays 8.75% to eBay on the $8.00 ($0.70) whereas if they charged $34.00 and free shipping, they'd pay eBay 8.75% on the full amount (or $2.97.) This would mean they'd have to add that 2.97 to the price and charge 37.00 for the item.

Sometimes, the only money seller's make is the s+h padding. Usually, it's not that egregious (i.e., 8.00 item/25.00 s+h.) That is actually against eBay rules (fee circumvention.)

Many of us will charge maybe $21.00 in that scenario with a $12.95 s+h (somewhere in the middle--but same difference...still paying 34.00.)

quanta said 7:43PM on 1-29-2008

Very disappointed. Experienced sellers know that the listing fee savings amount to pennies, while the Final Value fee increases will cost them many dollars, on top of the PayPal fees.

Meanwhile eBay does nothing regarding inflated shipping/handling charges, feedback blackmailers or scammers.

The only good news is the free Gallery feature, and even that is laughable. The total savings? 35 cents.

geekbee said 7:44PM on 1-29-2008

I totally agree with #3. And yes, the 8.75% FVF is applied to all listing regardless of the amount. This post is totally misleading. Brad Linder, you should've done some research before you post this. Visit eBay's forum and you'll get to read tons and tons of complaints from eBay sellers everywhere.

Andrew said 7:44PM on 1-29-2008

I get a message from eBay:

"You asked, we listened. We're reducing Insertion Fees and adjusting Final Value Fees to lower your up-front cost to sell on eBay."

Gee thanks, just gloss over the fact that you are going to kill everybody on the final sale fees. I'm not sure who eBay asked but, it certainly wasn't anybody that I know. I would gladly take the upfront fee over the new final value fee. I have used eBay over the years to sell my old gadgets to make money for buying new ones. I may have to find a new cheeper alternative.

Also eBay's new CEO, says that he wants to focus more on fixed price auctions rather than regular auctions.

Matt said 5:56AM on 2-13-2008

I agree, it's a joke. However, I will put more things up on eBay that I'm not sure will sell b/c I have less to lose if it doesn't sell.

kingkool68 said 9:30AM on 1-30-2008

The final sale fees are not as dramatic as you might think. Yes, they will still hurt you unless you sell things under a dollar. I crunched some numbers on my blog -> http://www.russellheimlich.com/blog/ebay-updates-fees-with-mixed-results/

I still prefer the Amazon Marketplace to sell my stuff to total strangers.

James said 3:02PM on 1-30-2008

I'm a bit confused. I always thought the reason people charged outrageous S&H was because eBay collected its percentage based on the final price, and didn't get a "cut" of shipping, so the incentive was to mark the price down and the shipping up. Is that wrong? It was always one of my biggest gripes -- the listed price of an item means nothing, because what actually matters is the total price including shipping, and there wasn't (at the time) a way to search auctions based on bottom line price. That might have changed, but I stopped bothering with eBay a long time ago exactly because of the shipping nonsense. I figured eventually they might notice what's wrong with their incentive structures and fix the problem, but I'm still not going to hold my breath.

Carol said 9:39PM on 2-11-2008

Well, I am so irritated with Ebay that since I have only been doing business for a few months I might as well start off on the right foot so I am now going to other sites and giving them a try. Very interesting how they are increasing over the last time I checked them out about 6 months ago. A big difference in the amount of people I see listing and buying. Since I am new I might as well prepare for the future and find a good secure home now that I can grow with and just ease my way away from Ebay. I don't want to build a business with a company, that in my view, is greedy.

Gayathri said 8:55AM on 2-21-2008

Ebay charges more day by day... They never change.. A highly recommended site is elfingo.com for online auctions. They are the new ebay. Many smaller sites like this offer buyers far better deals than ebay ever could. Buyser also save a ton because this site charges little or nothing depending on the day. One more reaso I like elfingo.com is because they don't take a part of the sale at all. No commissions or final value fees. A+++ http://www.elfingo.com

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