Is Ebay Costing Your Business Too Much?
April 6, 2011It’s often said that you don’t get something for nothing, so why should eBay be any different. If you want access to the world’s largest online auction site, and the millions of hungry buyers that go there each and every day, you would expect to have to make some sort of payment.
But eBay’s fees seem to be more and more of an issue with the professional sellers trying to run a profitable online store – and it’s hardly a surprise. With fees for listing, fees when you sell, and even fees for accepting the payment from your customer, these costs can soon add up. Is using eBay eating into your profits?
How the costs can mount up
Some of the most popular items on eBay are things like books, DVDs and video games, and if you decide to open your online store in any of these markets, you will need to pay eBay 15% of whatever you sell your items for. Then, because you will have to choose PayPal as one of the payment options, you will need to pay them 2-3% as well.
All in all, you might have to pay nearly 20% of any sale for the privilege of using their site. Okay, so this might be an extreme example, but even the lowest final value fee on eBay is 8%, and we haven’t even considered the listing fees and costs for any upgrades that might be necessary in order to attract customers. Of course you can get discounts on fees as a business user who subscribes to an eBay store – but there’ll be a fee for that as well.
Consider the alternative
It is going to be hard to make a profit when you have to give away 10%, or maybe even more, from each and every sale. However, making a healthy profit becomes much more realistic if you have an online store elsewhere on the internet – and there are plenty of cheaper, even free, platforms to choose from.
Even if you choose to still use PayPal as your payment processor, your cost per item sold could be reduced to as little as 2-3%! Plus you would have a lot more flexibility to brand and build your online store the way you want to – making it a much better option for businesses wanting to sell quality, high-value items, or products that customers might buy again and again.
Why eBay favors volume rather than value
It looks like the only way to make any real money on eBay, could actually be one of the main reasons why the site seems to be selling more and more cheap, low-quality items. By keeping starting bids and final sales values low, sellers with an online store on eBay will pay less in fees – although this does mean that you will have to sell an awful lot of items if they want to a decent living from it.
But no matter how cheap the items you are selling, or how many of them you sell, eBay will always mean your profits are less than they could be if you had your own online store on any of the other sites that are actually designed for the purpose. As well as making more money, there are a wide range of other benefits that make these eBay alternatives a much better option for most sellers, not least of which is that many of them are actually free! So maybe there is such a things as something for nothing after all.
Inspiration
- Challenges of Dropshipping on Amazon: Pitfalls, Alternatives, and Strategies for Success
- Shoppers Trust Amazon.com, Should You Sell At Amazon?
- The Future For Ebay & Online Shops
- An Online Shop Could Be A Better Alternative To Ebay
- 5 Reasons Why It’s Getting Harder To Be Successful On Ebay
- Why It Can Be Hard To Build A Business With Ebay
- Why Some Sellers Are Leaving Ebay
- Alternatives To Ebay That Could Be Better For Your Business
