Doing The New eBay Math


Thursday, 31 January 2008 at 7:39 am Pacific USA Time.

With eBay fees changing, I wanted to look at some other scenarios based on real data. For the purpose of this math fun, let’s assume that these sellers use Gallery on everything, and their items are all in the Core. I know many of our clients use Gallery religiously, but often don’t bother with the pack of upgrades. I’m also doing a 30-day Terapeak for real clients of ours to use real numbers without naming names. :)

Seller #1: 1640 listings, 45% sell-through, $5.03 ASP, $1.35 avg starting price
Insertion fees go from $656 to $574.
Not paying 35 cents for a gallery image on 1640 items saves $574.
FVF on 738 listings selling for an average of $5.03 goes from $194.89 to $324.81.
How it washes out: This seller saves $526.08 each month. So even a seller with an relatively low ASP and nice conversion rate can still save on fees each month.

Seller #2: 230 listings, 18.26% sell-through, $439.16 ASP, $40.35 avg starting price
Insertion fees go from $276 to $230.
Not paying 35 cents for a gallery image on 230 items saves $80.50
FVF on 42 listings selling for an average of $439.16 goes from $620.34 to $700.98.
How it washes out: This seller saves $45.86 each month. Not a huge savings, but it’s savings! :)

Seller #3: 5374 listings, 31.95% sell-through, $47.87 ASP, $42.62 avg starting price
Insertion fees go from $6448.80 to $5374.
Not paying 35 cents for a gallery image on 5374 items saves $1880.90.
FVF on 1717 listings selling for an average of $47.87 goes from $3519.85 to $5133.83.
How it washes out: This seller saves $1341.72 each month.

Seller #4: 197 listings, 99.49% sell-through, $5.28 ASP, $20.53 avg starting price. This looks weird, but this is what Terapeak said, so for the sake of our math example, let’s run with it! :)
Insertion fees go from $118.12 to $108.35.
Not paying 35 cents for a gallery image on 197 items saves $68.95.
FVF on 194 listings selling for an average of $5.28 goes from $53.78 to $89.63.
How it washes out: This seller saves $42.87 each month. I was really worried about this guy as I thought his fees might go up, but this is the math.

From the math I’ve seen, I think that the sellers hit the hardest are those using the feature upgrades pack that included gallery. I am not a fan of that pack as I’m not a fan of bold or border. Highlight can only be good when other people who might come up near you in search results AREN’T using it. If you were spending that much on feature upgrades, you don’t save the 35 cents.

These numbers are also without the potential discounts eBay is offering to PowerSellers. Some will get 5% off FVFs and some will get 15% off FVFs. So our sample sellers here, who happen to be PowerSellers, will see even more fee savings.

I am not saying that nobody will be negatively affected by this fee change. I am sure people will be negatively affected. But from some of my own math and knowing how my clients tend to list and use listing upgrades, I think that most sellers will see a fee decrease, especially if they qualify for the PowerSeller discounts.


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Categories: Just An Observation

Comments Closed

3 Responses to “Doing The New eBay Math”

  1. MJ says:

    Get a kick out of your examples. Is there a eBay policy change or fee increase you didn’t rah rah for.
    I seriously doubt everyone is going to see reduced fees as your narrow world portrays in your post.
    Lets get back to the real world, once in awhile.

  2. Well hello grumpy person. :) I don’t rah rah for everything eBay does no matter what. However, I do want to look at things more objectively than some people, who I think missed a few things with their fee math that showed that every seller will have higher fees.
    Many sellers will have lower fees. Lower fees are good. If your fees go down because of these changes, I rah rah that.
    There are things I don’t rah rah, but I didn’t get to them. I’m writing separate blog posts about how I feel about different changes. I don’t like the new PowerSeller requirement. But you don’t have to crap on me because I’m glad for the sellers who get lower fees.
    Are you angry that many sellers will have lower fees? Are you angry that I didn’t manipulate math to find only seller examples who will see fees go up? I used real examples of sellers who are my clients rather than made-up examples of people who in theory would see fees go up.
    Sorry!

  3. Michelle says:

    Thank you for the great examples. I used the same premise to calculate the effect on my listings and sales. Overall I save about $20 (before PowerSeller discounts). However, when I calculate the effect on my most popular item individually, I see a loss of about $0.30 everytime I list and sell. Not quite sure where the discrepancy is. Still checking on that. Just thought I would share.