eBay Fees Increase 84% in April

Updated 1/26/10
The first of three eBay changes to selling policies for 2010 has been posted. These changes, sometimes called a bucket may well lead sellers to feel the bucket has been dropped, with a thud, on their heads.

CEO John Donahoe said one week ago “we’ve made significant changes in rebalancing front-end versus back-end fees . . . we have aligned our incentives with that of our sellers. If they don’t succeed in selling we don’t succeed in collecting fees.”

In plain English that would indicate a drop in ‘front end’ or insertion fees with a corresponding increase in ‘back end’ or final value fees. Less upfront risk for sellers. If you are fluent in BaySpeak it means no such thing.

I predicted in October an overall increase being touted as an overall decrease because one tranche lowered. My initial analysis today is that nothing in this bucket is substantially lower. How that qualifies as a fee reduction or incentive to remain on eBay is beyond my skills to explain.

Hopefully I will have spreadsheets for you tomorrow, meanwhile, quick and dirty.

Stores vs Fixed Price

eBay in both Canada and the USA are moving to a plan similar but not identical to the one trialed in the UK last year. The major difference between the plans is that monthly store fees remain the same, in the UK they increased substantially.

Current insertion Fees for US stores are as follows for a 30 day listing:

  • List price less than $24.99 - $0.03
  • List price between $25 to $199.99 - $0.05
  • List price over $200 - $0.10

What this renders down to is:

FP30 Listings Insertion Fees

  • if you list 107 fixed price items a month today, insertion fees cost $37.35
  • with a basic $15.95 store subscription your insertion fees per month will decrease 10c in April
  • without the store subscription your fees will increase to $53.50 which is a 43% increase.
  • if you list 50 fixed price items a month today, insertion fees cost $17.50
  • with a basic $15.95 store subscription your insertion fees per month will increase to $25.95 in April which is an approximately 48% increase
  • without the store subscription your fees will increase to $25.00 which is a 43% increase.

Summarized: for low volume sellers Fixed price Insertion Fees increase a minimum of 43% from $0.35 to $0.50 per listing

FP 30 Listings Final Value Fees

Current FP30 Final Value Fees vary by category, this is unchanged.

  • Computer increases from 6% - 3.75% - 1% to 8% - 5% - 2% these are increases of 33% - 33% - 100%
  • Clothing is unchanged at 12% - 9% - 2% but major changes are promised mid year.
  • Electronics increase from 8% - 4.5% - 1% to 8% - 5% - 2% these are increases of 0% - 11% - 100%
  • Media is unchanged at 15% - 5% - 2%
  • General Merchandise (all other categories) are unchanged at 12% - 9% - 2%
  • Store Inventory Format (SIF) is gone. Today there are four price tranches, under $24.99, $ 25 - $99.99, $100 - $999.99 and over $1000. FVF are 12% - 8% - 4% and 2%
  • NEW SIF will be the same as General Merchandise FP 30 with three price tranches, under $49.99 - $50 to $1000 and over $1000. FVF will be 12% - 9% - 2%. This means increases on every item over $24.99, for example a  $49.99 item FVF will increase from $3.20 to $6

Auctions, if you do not have a store

Here are the decreases, sorta. Up to 100 auction listings per Non-Store Subscribing seller per month starting at $1 or below will have no Insertion Fees. If you are an occasional seller and sell things you can afford to let go for $1 you will save the 15c insertion fee. FVF go up from 8.75% to 9%, flat rate, to a maximum of $50.

  • Starting bid over $1  - $9.99 insertion fees decrease 30% from 35c to 25c
  • FVF increase on $9.99 item from $0.87 to $0.90 Net savings 7c
  • Starting bid over $10 - $24.99 insertion fees decrease 10% from 55c to 50c
  • FVF increase on $24.99 item from $2.19 to $3 Net increase 76c
  • Starting bid over $25 - $49.99 insertion fees decrease 25% from $1 to 75c
  • FVF increase on $49.99 item from $3.07 to $4.50. Net increase $1.18
  • Starting bid over $50 - $200 insertion fees decrease 50% from $2 to $1
  • FVF on $100 item increases from $4.82 to $9 Net increase $3.18  Cost of sale rises from $6.82 to $10 a 46% fee increase
  • FVF on $200 item increases from $8.32 to $18 Net increase $8.68  Cost of sale rises from $10.32 to $19 an unbelievable 84% increase.

Auctions for Store Subscribers

There is a sneaky little FVF increase, the 8.75% applies to the first $50 not $24.99 and the 3.5% thereafter up to $1000 increased to 4%, this adds $6.06 to FVF on a $1000 item. Over $1000 also increased from 1.5% to 2%.

  • Store subscriber (any level) starting bid under $1 insertion fees decrease 350% from 35c to 10c. FVF remain the same, net savings 25c.
  • Starting bid over $1  - $9.99 insertion fees decrease 30% from 35c to 25c. FVF on 9.99 item remain the same, net savings 10c.
  • Starting bid over $10 - $24.99 insertion fees decrease 10% from 55c to 50c. FVF on $24.99 item remain the same, net savings 5c.
  • Starting bid over $25 - $49.99 insertion fees decrease 25% from $1 to 75c. FVF increase on $49.99 item from $3.07 to $4.37. Net increase $1.05
  • Starting bid over $50 - $200 insertion fees decrease 50% from $2 to $1.
  • FVF on $100 item increases from $4.82 to $6.38 net increase $0.56  Cost of sale rises from $6.82 to $7.38 an 8% fee increase.
  • FVF on $200 item increases from $8.32 to $10.38, net increase $2.06. Cost of sale rises from $10.32 to $11.38 a 10% increase.

Crystal Ball Department

Auntie May thinks the reason eBay wants to merge sellers ID’s is to prevent sellers from being store subscribers on one ID and getting free auction listings as non store subscribers on another, or many others. What do you think?

Y’all come back!
Henrietta!

This is an old post, things may have changed since it was written. Using the search box may reveal more current information.

11 comments.

  1. Yes, Henrietta, the 84% increase in fees is pretty much unbelievable, and more than a tad above the Consumer Price Index, but the fee gouging just continues up to about $550 sales, where the final value fee increase hits 141%, tempered slightly by the lower listing fees.

    A good table of the increase in auction Final Value Fees is seen here:
    http://tinyurl.com/feegouge

    The Ebay email was titled “Coming March 30: 20¢ Fixed Price Insertion Fees with full search exposure, FREE pictures, new low fees for Auction-style listings”

    I will be in trepidation when I receive an email saying that auction fees are increasing….

    Kind Regards, Kevin

  2. Crystal Ball: Any new boycott considered by sellers will be rendered impotent due to fractured nature of the seller community.

  3. I know some people are upset about this but I am totally in love with this announcement. For me and my little corner of life, it means a huge fee decrease.

    That said, when my gf who only lists the 5 free auction items a month right now and I priced it out, with the 100 free insertion fees and even with the higher end of auction fees, it was still a savings for her overall. And if you want to ask how small a seller she is, the reason she called yesterday was to ask if I knew of a better way to take pictures other than just putting the items on her bedspread and using the light coming in from the window. :-) *sigh* Newbies.

    I know everyone’s knee jerk reaction is to freak out but I highly recommend sitting down and pricing it out first. Most sellers I have talked to of every size are finding it a savings overall. You can’t just look at one number. Just because final value, say, goes up, doesn’t mean you aren’t saving on another end.

    One thing I want to look into though is how this release is going to affect third party listing tools. With the greater advantages for stores and the free pictures for store owners, I can’t help but feel like a lot of people will drop their listing service and opt into stores instead. Hmmm. Maybe this is a post for my own blog. ;-)

  4. People are fairly excited one way or the other. It’s interesting that few are posting about the infrastructure consequences. So here’s a quick preview.

    Go to the eBay Stores forum and the eBay Special Discussion Board and peruse the threads.

    Depending on where you are located, the browser you are using (, and whether the person is an eBay Weed), page load times will be anywhere from near-normal to sluggish.

    The intermittent slow downs are due to the slight increase in viewers. Keep in mind the number of forum readers is a small percentage of the total number of eBay.com viewers performing searches.

    Care to take a guess what happens when core listings expand 500%, and the already redlined Search infrastructure (remember around Thanksgiving?) is pressed harder?

    Maybe more later …

    //

    Do you know what you’re doing?” The Brigadier
    “My dear chap, I can’t wait to find out.”
    The Doctor, Doctor Who

  5. In what scenario will anyone save money when final value fees are up 100%+? I assume you’re aware the insertion fee on a 99 cent listings is currently 10-15 cents? And that your potential savings would then be 100 listings at 15 cents each, or $15 total? And the final value fee increase on just one $300 item is $15.19, which would negate your entire “savings” for the entire month? Or am I missing something here?

  6. As with the introduction of this in the UK 18 months ago, everyone is focussing on the fees.

    Not enough people are looking at the competition and the site flooding that happens, then the wholesale culling of smaller sellers for “non-performance” that occurs to successful small sellers in direct competition with a portion of a range of products touted by Diamond sellers.

    The UK’s experience is that this will not keep out those “dreadful” Chinese sellers with 1.3 billion brothers, sisters, cousins, aunts, uncles etc of the same family name which can be used to set up multiple seller IDs - remember in China, the family name is the first name of someone, and their given name is the last name, which is a perfect way to bypass the multi-account checkers at San Jose.

    100 free 99c listings per month? Hey great, let’s open 1000 accounts, each specialising in a different product category, with each free listing pointing to our multi-item BIN for 2000 pieces of a $99 60-inch plasma TV with $500 shipping. Ok, that’s this morning’s job sorted, let’s do the same tomorrow.

    eBay will be thoroughly flooded - they just handed the keys to the kingdom to the overseas spam listers. Hong Kong and the big factory zones in SE China are going to love this. One factory with say 3000 workers, each with an eBay account, all selling the output from the factory on eBay - think it doesn’t / wont happen? It already is.

    Gaz

  7. EBAY SERFDOM
    EBay Fee Changes 2010

    The eBay marketplace is like the serf-based feudal system of medieval Europe. In medieval Europe there were rich land owners called lords. The lords had subjects called serfs that worked their land growing crops. The lords did not labor – except to occasionally whip the serfs to keep them working hard. The serfs were required to pay a large portion of the crops they grew to the lords as a form of rent. The big problem is that the serfs were trapped – they had no means of feeding themselves without the use the lord’s land. This problem led to abuses and near-slavery for the serfs.

    EBay strives to create such a system today. EBay owns the marketplace – the eBay site. The marketplace is like the land in the feudal system. Because eBay is by-far the dominate marketplace on the Internet they can act like a lord. EBay can dictate any rules they want to the sellers. If the seller depend on eBay’s for their livelihood are required to comply or starve.

    The new fee changes will cause most sellers to pay a lot more. Typical small to medium eBay store sellers will see listing fee increases from 70-150%.

    EBay wants to help those sellers earn the money they need to pay the higher fees. Sellers now get all items in full search results. This should result in more sales. With the extra sales sellers will be able to pay eBay more.

    These changes are like the feudal lord telling the serfs that he is generously increasing their farming area to 3 acres from 2 acres. At first this seems wonderful. It will help the serfs grow more food for their families, but it is not as it seems. Later it is revealed that the land rent has increased from the crops from just 1 acre to the crops from 2 acres. The serfs still keep the crops from 1 acre – same as before. Now the Lord gets double. The serfs just work harder – all for the lord. EBay is playing the same game.

    As long as eBay is the dominate marketplace sellers should only expect the situation to get worse. Don’t allow eBay to turn you into a modern-day serf!

  8. That is an interesting parallel David, I wrote “A Fair E Tale” which promotes the same theme in a bedtime story format in June 2008. It still holds true, as you noted.

  9. As a vintage/antiques seller on eBay, I took the time to look over their new fee charts slowly and carefully.

    A simple conclusion for us.
    This is US: With 350 items online, ASP at around $50, only 10 or so sales/month, store inventory format only, and selling on ebay for about 5 years (I think).

    Well, I just found out WE are their target sucker market. How we did business is exactly what ebay wishes to “tax” the most with their new fees.

    Not wishing to be promoted from biz person to serf, we are preparing our exit gracefully.

    We’ll, of course, be happy to appear occasionally on eBay when necessary (like a boatload of crap just arrived) or when the weather is good (like pageviews and sales skyrocket over there). Otherwise we’ll tend to our own lands where we don’t have to share every ear of corn with the crows.

    It’s a shame: since people do buy from us, happily, I thought we were providing a useful service to ebay’s buyers.

    I guess the new world dicatates that “if you aren’t selling according to eBay’s ideas of the marketplace, you can’t possibly be serving our buyers in the best way possible”.

    cheers.

  10. Added Red Ink to the round up of user comments. http://budurl.com/uq2c
    The variety of comments are all over the map on the Fee change.

    Great Article Henrietta!!

  11. Spam comments will be deleted … without exceptions. Admin

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