eBay & Me + 10%

By Tim Fields

About 15 years ago, I opened an account with eBay. It was when the company was really hot and at the time, just really getting going. This was also around the time they weren’t so damn politically correct and I could easily score pre-ban 15 round .40 caliber magazines. Since then, anything even remotely controversial has pretty much been banned, but I digress…

During that time, I was on there for mostly buying. It seemed though back then the prices were better than they are now; and now I understand why – but I will get back to that in a moment…

If I was looking for an obsolete item that I knew I’d have to hunt down for weeks, I knew I could find it on eBay. Or perhaps when I needed to get something I may have been embarrassed about getting at the local drugstore…

Total and complete anonymity – guys, you know what I mean.  Point, click and within a few days it was at my doorstep. What’s better than that? Nothing! Besides all the buying I did, I started selling on eBay as well. I’d sell stuff I had around the house from old clothes, books, fishing reels, silver… you name it.

It was either me giving it away to someone or making a profit on something I had paid for months or years prior. During those days, as a buyer it was great and it still is. Being a seller though, well, it was good back then, but as of lately, not so much. The thing is – eBay is the king of the online auction sites. It was a pioneer and it still reigns even as its “seller fees” increase. There are alternatives, but at the same time there aren’t. There are companies looking to take away business from them such as Etsy and eBid, but there’s no volume there. There are customers, but not nearly as many as eBay.

I know a few people who have sold on eBay who’ve pulled out and gone elsewhere, and I know people who stick it out and try to squeeze what they can from eBay. Personally, I saw sticker shock last week when I sold what equated to $100 worth of jeans. Admittedly, I got a bit chubby during the winter. I probably gained 15lbs; it was cold. What can I say? I got sick and tired of putting on size 34 waist American Eagles and just bit the bullet and went up a size. And the 34’s I once had – gone. I wanted nothing to do with them.

You might say, “Why sell them? Why not exercise and size down”? Well, I figured if I worked hard enough, a few new sets of 34s would be a nice present to me. So anyhow, I ended up selling all of them and walked away with $100. Not bad right?

Well, not so fast… eBay wanted its share and so did PayPal (it’s the chosen online payment gateway, if you live under a rock). First, $10, gone from eBay. Next, another 2.9% per sale plus $0.30 per item, which equated to $4.40, down the tubes. I walked away with $85.60 in my pocket.

Now that’s not bad because I don’t sell on eBay for a living, I do it to get rid of junk or sell jeans that are too small. But others do… others depend on eBay and these fees, while important for eBay and their shareholders, may be doing damage to their selling customer base. But will the fees be enough to turn people away from eBay?

Many online sellers have given up completely when faced with eBay fees.  But for many more, the costs may be high (but still workable) considering without eBay, they’d have a standalone online shop in a sea of millions of websites across the net. eBay still seems to be surviving. Currently they’re very close to a 1 Yr high and show no signs of falling.

At almost $58/share, I’d say those 10% sellers fear have done them well.