eBay, Inc. (EBAY)

LiquidIQ (< 20) Submitted: 1/17/07 8:52 AM : Start Price: $30.01 EBAY Score: 13.58

I'm an eBay seller. Below are the fees I paid eBay in the last 2 years:

2005 eBay fees: $16.6K = 21% of sales
2006 eBay fees: $21.1K = 28.3% of sales

In 2005, 27.7% of the items I listed on eBay sold. In 2006, 18.9% of my items sold. I've been selling the same items both years, most of them for around $10.

What I see is my eBay fees going up and my sell through rates going down. Maybe it's only the items I sell but I've heard a lot of other sellers complaining that their sell through rates are going down as well.

eBay decided to increase fees starting Feb 07 which would again cut into my profits or I would have to increase my prices. On top of that, USPS will announce a large increase in postage in the Spring. If I decided to continue selling, I would have to increase my prices/shipping fees. Are buyers willing to pay more money for the items they can probably find cheaper somewhere else? I don't know.

Since the beginning of January, I stopped listing any new items on eBay as I'm seriously considering just getting rid of my inventory and calling it quits. This is something I do part time so I can afford to do that. I would miss the extra income but there comes a time when it's just not worth my time. A lot of sellers make a living selling on eBay so they cannot afford to do that. Is eBay going to miss my fees? Probably not. Are they going to miss it if 1000 sellers like me do that? Probably.

At the moment, eBay is just about the only game in town so sellers have nowhere to go. There are other alternatives like Yahoo or Amazon auctions (and others) but they don't even come close to eBay. If that was to change, you would see a huge number of sellers abandoning eBay. Maybe that will never happen but who knows?

eBay is taking advantage of being the monopoly by squeezing as much money out of seller as they can because they can. I do not believe that's right and I think it will hurt them in the long run.

My goal in writing this was not to complain about eBay but to warn and educate potential investors. Without sellers and buyers eBay is nothing. I think eBay is upsetting both (sellers with constant fee increases and buyers because they're really the ones who pay for those increases). How much more are buyers willing to pay?

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