EBay for Dummies (37 page)
Authors: Marsha Collier
Tags: #Electronic Commerce, #Computers, #General, #E-Commerce, #Internet auctions, #Auctions - Computer network resources, #Internet, #Business & Economics, #EBay (Firm)
If eBay deems your auction invalid because the item doesn’t meet eBay’s policies and guidelines, you can find out why by checking the page at
pages.ebay.com/help/sell/questions/listing-ended.html
. If you still feel you’re in the right, scroll down the page to the Contact Us link. Click there to plead your case.
eBay Fees? What eBay Fees? Oops . . .
The Cliché Police are going to raid me sooner or later, but here’s one I’m poking a few holes in this time around:
You gotta spend it to make it.
This old-time business chestnut means that you need to invest a fair amount of money before you can turn a profit. Although the principle still holds true in the real world (at least most of the time), on eBay you don’t have to spend much to run your business. This is one reason why eBay has become one of the most successful e-commerce companies on the Internet and a darling of Wall Street. eBay keeps fees low and volume high.
eBay charges the following types of fees for listing on the site:
Regular auction insertion fees:
$0.10 to $4.00.
Fixed-price listing fees:
Either $0.15 for media, such as books or DVDs, or $0.35.
Real estate listing fees:
Vary because you have the choice of listing your property as an ad rather than an auction. Because eBay real estate auctions are
non-binding
(due to legalities), you may be better off running an ad. eBay charges different prices for different types of real estate:
•
Timeshares, manufactured homes, and land
Auctions: 1-, 3-, 5-, 7-, or 10-day listing ($35.00); 30-day listing ($50.00)
Ad format: 30-day listing ($150.00); 90-day listing ($300.00)
•
Residential, commercial, and other real estate
Auctions: 1-, 3-, 5-, 7-, or 10-day listing ($100.00); 30-day listing ($150.00)
Ad format: 30-day listing ($150.00), 90-day listing ($300.00)
Automotive fees:
The first four listings are free, with subsequent listings $20.00; motorcycles are only $15.00.
Additional reserve-auction fees:
$2.00; auctions with reserves over $200.00 are 1 percent of the reserve with a maximum of $50.00.
Final value fees:
A percentage of the sales price.
Optional fees:
Vary.
Insertion fees
Every item listed on eBay is charged an insertion fee. There’s no way around it. The insertion fee is calculated on a sliding scale based on the
minimum bid
(your starting price), your fixed-sale price, or the
reserve price
(the secret lowest price that you’re willing to sell your item for) for your item. (Later in this chapter, I explain how the reserve price affects what you eventually have to pay.)
eBay understands that there’s not as much profit margin when you’re selling a media item, so they have a lower listing fee to encourage you. What’s a media item? New or used books, music, DVDs, movies, and video games. Take a look at Table 9-1 for eBay’s insertion fee structure.
Table 9-1 Auction Insertion Fees | ||
Starting or Reserve Price | Insertion Fee | Insertion Fee for Media |
$0.01–$0.99 | $0.15 | $0.10 |
$1.00–$9.99 | $0.35 | $0.25 |
$10.00–$24.99 | $0.55 | $0.35 |
$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–gazillions | $4.00 | $4.00 |
If you’re running a reserve-price auction (explained in detail in Chapter 10), eBay bases its insertion fee on the reserve price, not the starting bid. eBay also charges a fee to run a reserve-price auction.
eBay has a different fee structure for items that are listed as fixed-price sales. They are quite the bargain, so if you have multiples of a single item and know what you need to get for them, a fixed-price sale is a great way to go! Do know that there is a slightly higher final value fee for fixed-price listings, but more on that later. Table 9-2 shows you the insertion charges for a fixed-price listing that can stay on the site for as long as 30 days!
Table 9-2 Fixed-Price Insertion Fee | ||
Fixed Price | Insertion Fee | Insertion Fee for Media |
$1.00 and more | $0.35 | $0.15 |
Here’s a snapshot of how a reserve price affects your insertion fee. If you set a starting bid of $1.00 for a gold Rolex watch (say what?) but your reserve price is $5,000.00 (that’s more like it), you’re charged a $4.00 insertion fee based on the $5,000.00 reserve price plus a $50.00 reserve fee (1 percent of the reserve price). (See Table 9-5, later in this chapter, for the reserve auction fees.)
So what does the insertion fee buy you on eBay?
A really snazzy-looking display page for your item that millions of eBay members can see, admire, and breathlessly respond to. (Well, we can only hope.)
The use of eBay services, such as the Trust & Safety program, which protects your selling experience. (Chapter 16 tells you how to use Trust & Safety during and after your sale.)
Final value fees
If you follow the movie business, you hear about some big A-list stars who take a relatively small fee for making a film but negotiate a big percentage of the gross profits. This is known as a
back-end deal
— in effect, a commission based on how much the movie brings in. eBay does the same thing, taking a small insertion Fee when you list your item and then a commission on the back end when you sell your item. This commission is called the
final value fee
(FVF) and is based on the final selling price of your item.
eBay doesn’t charge a final value fee on an auction in the Real Estate/Timeshares
category as they do in other categories; instead, they charge a flat
notice fee
of $35.00. There’s no FVF fee for Timeshares, Manufactured Homes, and Land or Commercial or Residential. But in the Automotive category, you pay a flat transaction services fee of $40.00 for passenger vehicles and $30.00 for motorcycles if your auction ends with a winning bidder (and the reserve has been met).
In real life, when you pay sales commissions on a big purchase such as a house, you usually pay a fixed percentage. eBay’s final value fee structure is different: It’s set up as a three-tiered system. Table 9-3 covers the calculation of final value fees for auctions.
Table 9-3 Auction Final Value Fees | |
Closing Bid | To Find Your Final Value Fee |
$0.01–$25.00 | Multiply the final sale price by |
$25.01–$1,000.00 | You pay $2.19 for the first $25.00 of the final sale price (which is 8.75 percent). Subtract $25.00 from your final closing bid and then multiply this amount by |
$1,000.01 and over | You owe $2.18 for the first $25.00 of the final sale price (which is 8.75 percent). But you also have to pay $34.13 for the remainder of the price between $25.01 through $1,000 (which is 3.5 percent). This amount is $36.32. |
Table 9-3 shows where things get tricky. There are different final value fees (FVFs) for fixed-price items in different categories. Checking out the costs involved in the individual categories may help you decide which type of items you choose to sell. Table 9-4 is an attempt to clarify the tiers.
Table 9-4 Fixed-Price Final Value Fees | ||
eBay Category | Closing Price | To Find Your Final Value Fee |
Consumer Electronics, Video Game Systems, Cameras & Photo | $0.01–$50.00 $50.01–$1,000.00 $1,000.01 and over | 8% 8% 8% |
Computers & Networking | $0.01–$50.00.00 $50.01–$1,000.00 $1,000.01 and over | 6% 6% 6% |
Clothing, Shoes & Accessories | $0.01–$50.00 $50.01–$1,000.00 $1,000.01 and over | 12% 12% 12% |
Media (Books, Music, DVDs & Movies, Video Games) | $0.01–$50.00 $50.01–$1,000.00 $1,000.01 and over | 15% 15.00% 15.00% |
All Other Categories | $0.01–$50.00 $50.01–$1,000.00 $1,000.01 and over | 12% 12.00% 12.00% |
If you try to work out your own final value fees, you may get an extreme headache — and come up with fractional cents. Know that eBay rounds up fees of $0.005 and more and drops fees below $0.005. These roundings are done on a per-transaction basis, and generally even out over time.