Today we’re presenting a list of ways to cut costs by saving big on eBay fees. There are only two ways to make more money in eCommerce; either sell more or cut costs. When you cut costs, it puts money right to the bottom-line. The tips below are typical results, which may not include all the variables, such as category pricing differences, etc.
Become A Top-Rated Seller
It takes a lot to achieve and maintain the top-rated seller status on eBay. If it fits within your business model, you can save 20% on eBay final value fees by offering a 14-day return policy, 1-day handling, and by uploading tracking numbers. As an added bonus, items that you can do this with get a boost in eBay search results.
Final Value fees can be as low as $9.00 or as high as $15.00 for a typical $100 sale so for each $100.00 sale, you can save as much as $3.00. To get a better idea of how much this would put to the bottom-line of your business, you can enter your typical sale amount into the eBay fee calculator and multiply by your average number of sales. The eBay fee calculator can be found at:
Get An eBay Store
An eBay store is not a real eCommerce website because you do not control the content, layout, design or policies. However, it does get your products in front of millions of potential buyers and it has a left side navigation bar that displays the categories of your eBay listings. The chief advantage of having an eBay store is that it saves you money on fees. The downside is if you have an eBay store, you cannot get the 50 free listings per month.
Using the eBay Fee Illustrator and selecting 1,000 Fixed Price and 1,000 Auction Items, with a 20% sell-through rate, eBay recommended a Premium Store. In this scenario, the savings is $440.00 – much more than the subscription cost of the store plus the cost of the 50 free listings. The eBay fee illustrator can be found here:
Use Your 50 Free Auction Listings
If you do not have an eBay store, you can list up to 50 auction items per month for free. Insertion fees range from $0.10 to $2.00.
Sellers can save $5.00 to $100.00 per month, depending on the starting or reserve price of their listings.
Avoid Listing Designer
Listing designer costs $0.10 for three, five, seven and ten day listings and $0.30 each month for Good ‘til Cancel items. With some basic html (so you can at least make a paragraph) you can do without a template. Listing designer is an added expense that most sellers do not need. A great template makes your listings more attractive and attractive, professional listings command higher sales. Either use a third-party that offers templates as part of their package, such as www.Vendio.com, or create your own template.
The cost savings over a one year period listing 100 items per week runs between $520 and $1,200. If you list 100 new Good ‘til Cancel items per week, and they are re-listed, the cost savings is in the thousands!
As with the listing designer, the fee to schedule a listing is $0.10 per item. Scheduling a listing can ensure that your item is always available, and that the listing ends at an optimal time. As with listing designer, use a third-party that includes scheduling listings in their service, such as www.Vendio.com, or bypass scheduling listings altogether.
Scheduling listings does have value. And so does your time. If you don’t want to work weekends or your work schedule does not permit you to list/end items at an optimal time. However, investigate services that offer free scheduled listings vs. trying to list all your items on Sunday mornings.
The cost of scheduling 100 listings per week is $520 per year. Between listing designer and scheduling listings, you could spend thousands per year unnecessarily. Beware the add-on!
Relisting item credits on eBay have always been hard to explain. There is an insertion fee each time you list an item. However, on your FIRST relist, you are entitled to an insertion fee credit IF your item sells. Where it gets confusing is on the third try. Your third try counts as a first listing and the process begins again. Thus, if you list an item 10 times, the 2nd, 4th, 6th, 8th and 10th listing qualifies for the relist fee credit IF the item sells. However, if your item sells on the 1st, 3rd, 5th, 7th or 9th time, it does not qualify. Confusing? Yes!
Ideally, your item would sell on the first or second try. If it does not, you may wish to convert the item to fixed-price Good ‘til cancel listing and lower the price so it will sell. Or consider not listing it at all.
If your insertion fees are $1.00 and your sell through rate is 50%, you will save $1.00 per listing. This is treated as a rebate, thus you are charged and credited on eligible items when they sell.
Use Second Chance Offers
If you have more than one of a given item, or the winning bidder of your auction backs out, you can send out second chance offers to anyone who has placed a bid on your item. If you had a lot of bidders this is a great way to make additional sales without incurring listing fees. Since auctions can no longer have a quantity, but are limited to a single item, Second Chance Offers are a great way to get additional sales without listing or relisting an item.
Second chance offers are not charged a listing fee, thus you can save between $0.10 and $2.00 per item that you sell using Second Chance offers.
Choose The Right Category
Insertion fees and final value fees vary by category, marketplace, store subscription and listing type (auction vs. fixed price). The best bet is to choose the most appropriate category for your item. This improves the likelihood of a sale, which is the goal. However, there are items that fit in more than one category, such as a collector book, which could go under collectibles. In this case, choose the category with the lowest fees. Do not choose both categories, as you’ll be charged an insertion fee for both categories AND you’ll be charged the higher final value fee when an item sells. (Read the last sentence twice.)
By selecting the best category and only selecting ONE category, you can save 50% on insertion fees. In addition, if you are able to choose a category that is less expensive, you can save up to 5% on final value fees. For more on fees and categories visit: http://pages.ebay.com/help/sell/fees.html
Save On PayPal Fees
Most merchants do not know that PayPal offers tiered pricing. If you’ve been a merchant for more than 3 months, and you do over $3,000 per month in transactions, you are eligible for a per transaction discount. The catch is this – you have to ask! To take advantage of this savings, click on the “Apply Now” link under fees on the PayPal website.
A seller whose average selling price is $50 can save $20 per 100 items by reducing his fees from 2.9% to 2.5%. The same seller can reduce his fees by $35 per 100 at the 2.2% level.
Reducing the cost of shipping is hard to do. The best carrier discounts are reserved for high volume shippers, however, if you print your labels from eBay directly (or use Vendio Integrated USPS Postage Printing), you can get the “commercial base” rate from the USPS.
On a priority mail package that normally costs $5.20, your cost would be $4.90, a savings of $0.30 per package.
eBay constantly runs promotions. You can save big on free listing promotions if you have items ready to launch. Use Vendio or third party tools to store items and have them ready to list to avoid “free listing day panic.” This is great for long-tail items which are harder to sell, or that you have tried to sell in the past with no success.
There are frequently both free listing specials for eBay store and non-eBay store sellers. Make it a part of your daily routine, along with your cup of coffee, to check the eBay announcements board before your day starts.
One caution that’s really important to note… When a promotion has add-on’s like free subtitle and the item does not sell, when you relist the item you will be charged for these ad-on’s. To avoid the fees, remove the feature before you relist.
If you only take advantage of eBay promotions, you could get away with not paying listing fees at all! However, most sellers are not able to wait for a sale, but hope to take advantage when they come around.
eBay fees are complex. There are pre-sale listing tiers and fluctuating post-sale final value fees. There are item add-on’s and account add-on’s, not to mention payment and shipping fees. Finding ways to save on these fees gives you a competitive edge and reduces your cost of doing business.
The final note we will leave you with is the famous Ben Franklin quote, “a penny saved, is a penny earned”. We hope we’ve helped you save some pennies (and real dollars too).
About the Author: Vendio
Vendio lets you reach buyers where they are shopping online. Publish on Amazon, list on eBay and eBay Motors, manage orders, manage inventory and manage shipping from one complete, reliable and secure software platform. Vendio provides eCommerce software for small business that is Simply Powerful.