eBay Stores: What's Your Strategy to Cope with Fee Hike?

[dixielady060303]

Some of us have been at Ebay since the CEO answered all the emails himself and we are steamed. It's true that they don't make as much money on stores as they do on auctions that end in 7 days, but they get ever increasing Final Value Fees and money from their other company, Paypal on fees for payments. Yet, they have pushed, "open an Ebay Store, be an overnight Millionaire" down the throats of millions and the store number increased 2000%. Now, they are having legal troubles on many fronts, their executives keep jumping ship, they have announced plans to do a huge stock buy back and it all smells to high Heaven! Can you spell stock manipulation?!? A lot of us, who remember when nobody thought Ebay would work, nlow have a huge discussion thread going, wherein we are discussing leaving our stores open, going as a block to some other website, one in particular is listed number 2 behind Ebay, and seeing what happens. Slow sales are still better than no sales. Might as well Not sell anything if Ebay and Paypal get all the profits. (See auction ratings on this site) We are brainstorming like crazy on how to get the word to as many people as possible. Talk about Bad Faith. First they invite and promise, then they change the rules, hike the fees and generally act like they are untouchable. Maybe we can't really hurt them but we can sure try and try and try! I have had emails from older people, who acted in good faith on Ebays promises, and invested money they could not afford to lose in the stores Ebay was promoting (see the hundreds of articles on Ebay Millionaires they Ebay got published) and now, they are facing ruin. We are talking about small Mom and Pop stores, owned and operated by single mothers, retirees and people that are honest, work hard and have been totally betrayed by Cobbie and Megzilla and their hatchet men. Enough is really Enough. Grassroots movements have been a tradition in this country since the Boston Tea Party and someway needs to be found to bring Ebay down. It could be thru the courts, the Securities and Exchange Commission or by simply huge numbers of store owners, leaving their Ebay stores open since they want us to close, and moving in a block to another auction site. Please help us spread the word. Check out the discussion group on Ebay at the Soapbox discussion group: Ebay raises fees again! Dixie
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Ebay selling

[rtccccmg]

I am dying with laughter. What a hoot! I am so glad you posted and told me to go to ebay to check that out. The belly laughs are really helping my disposition, ulcers and mouth cankers brought on by Ebay's assistance.

Laughter really is the best medicine. Now if my creditors will take laughter to pay the bills I can no longer pay due to Ebay, life will be good

[viviene]

Fortunately I saw this coming. I opened my store and one month later the store search was taken away. I started looking for a new venue at that time. I then moved my store to Main Street Malls Online to the Main Street Vintage mall. I absolutely love this venue. They are responsive, really listen to you and implement suggestions quickly and are much less expensive than Ebay. Since the announcement the other day about the rise in store prices we have doubled in size at this venue. Thanks Ebay!
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Viviene

[rtccccmg]

Link please

[viviene]

http://mainstreetmallsonline.com

If you don't see a mall that your store will fit into all you need to do is email the owners, Lora and Steve. They started out with 12 vintage clothing stores that opened on June 2, 2006. We are also working on changing the look a bit.

There are vintage sellers who are also running a MySpace account connected to the vintage mall since there are so many young people into vintage clothing.

There is a discussion board here as well so if you have questions the sellers that are already at this venue can answer any questions you may have. Come on over!
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Viviene

[ronmansfield]

Okay, look. I'm as concerned as you about the Store fee increases. (I'm not all that crazy about $4.00 gasoline either.) But suppose that we could move $25.00 items from our Stores to a series of BIN listings and cut unit selling costs from $2.92 to $2.63 each, get the additional visibility of the "traditional" format's search prominence, sell more units and improve profit. Well, maybe we can.

This is not as bleak as it seems. We are actually being pushed by eBay to do something for ourselves that we should have done long ago, and keep complaining about, which is improving our products' visibility. Clearly eBay is not going to give Stores greater visibility in the search engine. You want your items to be seen? List using 10-day BIN and take advantage of your Store's newsletter marketing, RSS feeds, cross-promotional tools and your Store's ability to showcase your stuff.

Do you think that BIN selling always costs more than the Store inventory alternative, even at the old Store prices? Maybe not if we do it right. Here, look:

In the "good old days" if 10 $25.00 items sat our Stores 30 days and eventually sold over that period they'd cost us about $2.92 each in fees, (assuming the buyers used PayPal, we pay the 2.5% merchant rate and we used a gallery photo).

If, instead, we list those same 10 items using three 10-day BIN listings spread over 30 days, (1 listing of 4 units and 2 listings of 3 units, let's say), the per-unit cost will be $3.06, an increase of about $0.14-per unit, which is less than 5% BTW.

But hey, BIN means more visibility, right? We all know that "traditional" listings get the most eyeballs when they first start and just before they end. Ten-day listings do this for us, (as do 5 and 7-day listings, but 10-day is probably a better way go with this approach). Fixed price listings have a beginning and an end, and they show up in regular old searches. They also show up in our Stores.

Suppose all that grumbling we do is right and better exposure really does translate into better sales. Suppose we list 10 items in a single 10-day BIN listing and they all sell. Suppose we do that three times a month. The unit selling cost decreases to $2.63 per-unit and we've sold 30 units instead of 10. We gross $750 instead of $250. Hmmm.

Even if we list 30 units using three 10-day BIN listings and sell only half of them we have sold 15 units rather than 10 and the per-unit eBay and PayPal fees increase to a still manageable $3.02 per-unit. The per-unit fees have gone up a dime from the "good old days" but we are selling $125 more product. I can live with that.
And maybe I'll increase my unit prices a bit to cover the cost of potentially unsold BIN items, (and/or realize a cut in product costs due to my increased sales volume). The trick is to list about the right number of units that will sell over the 10-day BIN run, and do this repeatedly. Selling Manager Pro is an easy way to do this without much human intervention, BTW.

I say, keep your storefront. Organize it as a showcase for both your auctions and BIN listings. Use the cross-promotional tools Stores provide. My Store's email newsletters work like a charm. Many people read them. Newsletter readers then look at my items, and often bid or buy immediately. I also love the auction cross-promotion tools. Plenty of people come to my store, (http://stores.ebay.com/ChildhoodRadio) click on the "What's new?" Store category I've created and then look at my auctions. The reverse is also true. Auctions and BIN listings drive folks to the Store.

Make sure all of your listings contain links that point to your Store which should be well organized by product category, or size or gender, or whatever works for your products. Use the cross-promotion box at the bottom of all your listings. Look at the traffic reports and see what else works or needs work.

Fine-tune your Store pages' keywords, (meta tags). Google, Froogle and others do index Stores, particularly if you have the feeds turned on, (yet another Store feature). And when folks arrive at your Store from Google and Froogle or your auction or your newsletter or your off-eBay website, if the Store is laid out right they will see your auctions, your BIN items; they see what's new and they have a search engine that searches just your items.

Any accountant or seasoned retailer will tell you that the key to retail profitability is to turn inventory quickly. "Parking" items in our Stores for a year, even at pennies a month is a dumb idea. We tie up our cash and our floor space, and our product is getting shelf-worn, and in many cases becoming obsolete. If it's not selling profitably on eBay stop trying to sell it there, or have a fire sale but be sure people are seeing your stuff first.

Yea, we can all go to "St. Elsewhere". I've been there and come back. It's not nirvana on those other servers either. Even if you set up your own storefront by yourself this will distract you from finding stuff to sell and from selling it. Sure, you can pay someone to set up and maintain elsewhere.com for you, but this won't be free or 100% reliable either. And your brand-spanking-new Elsewhere is going to start out as a very small town in the middle of nowhere, at least for a while.

Before you leave the big city be sure you have given it your best shot. The only thing constant is change.

[beadyeyemedia]

What's funny is that the same 3-4 sellers who clutter up a board aren't good businessfolks. Why do I say this? If I have 30 of the identical item in stock and list in a fixed priced auction, I would list all 30 items in ONE listing. Not only do you get a bulk discount the more items available to sell, but it stays up everytime you make the sale for the duration of the auction.

Funny, these maroons will spend .60 or whatever per listing when it's much cheaper to consolidate all those listings in one auction.

No wonder Ebay raised the limit.

[ronmansfield]

Not interested in turning this into a flame war beady, but the reasoning behind smaller multiple BIN listings is that a lot of folks look at newly listed and ending soon sorts. It's about getting seen. Last month I had a 95.3% sell-thru, a $125.55 ASP with a nice mix of auction, FP and store sales.

[gazlannathai]

What a lot of you have missed - is that although the US rolled back the store visibility months ago, and you pay extra for 10 day listings, in the UK the rollback of store visibility was announced in the same annoucement as the fee hikes - we got a double whammy after 18 months of ramming down our throats how cheap and worthwhile it was to open a store.

Take away the visibility we fought long and hard to get, AND triple the ILF, and double the FVF in the process - it was like being kicked in the nuts by someone wearing a porcupine as a boot.

On top of that Meg-lomaniac tells us we're all pricing our products wrong, selling the wrong items etc etc without knowing anything about our individual businesses. This whole thing was instigated in the US without any thought for the different conditions of different national markets, and has even got British Members of Parliament (equivalent of Congressmen) talking openly on TV about how disliked Americans as a whole have become under the Bush administration (read it as meaning too aggressive and domineering). In the eyes of the Great British public, this change has done zero to aid the image of America or her citizens and businesses.

I think it's worth you guys pausing to look at the wider picture for a bit.

Year on year, my eBay sales increased 300% in terms of volume and value, during the last year of having a store compared to the previous year of not having one. My overall fees also increased from an average 50 UK Pounds per month to over 300 as an average, but fell back from February to around 200 with the ammended store fees and greater visibility. If I try to continue in the same listing model as before, they're going to jump to over 500 - remember we're talking UK Pounds Sterling here, not US Dollars, so double it to get a rough dollar rate.

No-one is benefitting from this except eBay (maybe) - the sellers lose out, the buyers lose out (less sellers and higher prices from those who stay), and the American image loses out because of the global negative PR it causes for "American Capitalistic Greed".

eBay may just become a US only site if it keeps this up - did any of you realise that there is an EC law which could prevent eBay from carrying out these hikes? It's to do with creating price rises in excess of the rate of inflation within a country that's party to the Maastrich agreement on convergence to a single European Currency. i.e. Meg may have just caused eBay to break the law in every country in the world's second largest economic block.

Ooh - now that would be fun wouldn't it?
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Selling as "GazLanNaThai" at
www.ebay.co.uk www.ebid.co.uk www.qxl.com www.thinkauctions.co.uk
and others.
>> Search the name - you'll be surprised what you find <<

[stuff-i-got]

The timing of the announcement of the fee hike has its own implications. For the past 18 months we had been led to believe that there would be an annual fee adjustment each January/February. This announcement occured concurrently with the release of ebay's quarterly report. I do not believe that this is a coincidence. The fee hike, along with the promised buyback etc are aimed solely at boosting investor confidence and have little to do with any understanding of the nuts-and-bolts of online selling. Every 3 months could now usher in a new policy change as Meg and co react to the whims of the stock market rather than mundane retail savvy.

I'm in Australia. Final Value Fees for stores are jumping from 5.25% to 10%. Store subscription price is jumping from $9.95 to $14.95 (Aussie dollars). I diversified off ebay 18 months ago so I wont be particularly affected by the hike. But it sure doesn't encourage me to list more ebay auctions.

[goodoletom]

[goodoletom]

[Tradguy]

romansfield -

Your analysis works out fine IF all the items sell.

When I have a hot item that always sells, I DO NOT put it in my store. I want the exposure and I'm willing to pay for it.

I have been almost 100% fixed price for about 3 years, so we're talking about the same thing.

What you are completely missing is that most store inventory are for items that are much slower sales, older "styles", or seasonal. Stores allowed sellers to keep these items out there for sales all year round.

It actually works for obscure items (a lot of what I sell is obscure...lol) since a general ebay search will yield very few of that item, the store items will show up. In this sense, some items get just as much exposure as a regular auction. More if you consider that it'll show up the same way over a long period of time.

I'm so glad you have a 95% sell thru rate. More power to you. You are in the top 1% of ebay sellers. I hope you make millions. Really, I do. You have found a magic product. It probably wouldn't matter if ebay doubled ALL fees and got rid of store - you would still do well.

The reality is that I might put out 1000 store items in multiple quantities for 1 year and I might make 2000 sales - many I don't sell at all, many I sell multiples of. Total cost to list (with gallery) is $30/month or $360/year + store subscription of $15/month = $540/year to list. At an average sale price of $15, that's $30,000 in sales for $540 in rlisting fees. Not a bad exchange.

The factor you are not considering AT ALL is sell thru rate OVER TIME. If I put all 1000 items at 10-day auction (fixed price) - something I used to do back a few years - perhaps even go multi-quantity - with gallery we're talking $600. That's fine if I were to sell 2000 items - about the same in fact.

But most items cannot sell in limitless quantities and styles in 7 or 10 days. More obscure items find buyers throughout the year. I have one item that I have sold over 150 times in 5 years. That's 30 buyers a year, 2.5 buyers a month, .08 buyers a day. My point is that if I put out 30 of these for sale right now for 10 days there is only .8 buyers out there - I MIGHT sell one of these. I might not sell any of them.

If I did sell that "1", it would of cost me about $4.00 in listing fees for one 30 quantity fixed price auction. $15 in sales for $4 in list fees.

By contrast, it can sit in my store for a year for only .39 cents. I will sell 30 of these. $450 in sales for .39 cents in list fees.

But let's be more realistic. Let's say I put out this one item over and over again in quantity "1" - since chances are I won't have multiple sales in a 10 days period. Let's say I don't use a gallery pic. That's roughly 36 auctions at .60 each, or $21.60 for those same 30 sales.

So I appreciate your advice, but it doesn't add up for most of us.

The PURPOSE of the ebay store is for items with a longer sales cycle, and Cobb's analysis of it taking - on average - 14 times longer to sell a store item actually seems rather reasonable.

Rich

[ronmansfield]

Thanks for your thoughtful (and courteous) comments.

The reality is that eBay has decided that they don't want "obscure stuff" sitting around in stores for more than a year. What you (we) think an eBay store is designed to do is clearly not what eBay thinks. And it is their factory, ya know? GM has decided to build Hummers, Toyota makes Hybrids. eBay wants to move product of a higher value and more quickly than most store sellers are currently doing.

And so, given the state of things, my suggestions from earlier posts fall in line with what you are saying. Agreed. Inexpensive oddball items are now less attractive to sell on eBay than before, and in all honesty were not that profitable before the hikes unless, of course they drew people into your store where buyers purchase multiple items in one visit, get to know you and like your stuff, and return to purchase again.

A combination of BIN, store inventory and auctions does and will still work when you use them together, and especially if you use the other store tools -- cross promotion, email marketing, RSS and Store feeds to comparison sites, all part of the Store "features" list.

This combo brings people to your own private space on eBay where you sell them (hopefully related) things. If the items you sell hang together somehow, dolls or vintage radios or whatever, and if you brand yourself and your store, and sell stuff that is unique and profitable, even after the hikes an eBay Store it will probably still work better and be cheaper than an "elsewhere" solution unless you already have a strong following that you can quickly and effectively take with you when you leave here.

My Grandfather used to say "The perfect product costs a dime, sells for a dollar, and creates a habit." (And that was before eBay raised the Store fees ;-)

Best of luck whatever you decide.
Ron

[es]

just a follow up to my earlier post on this thread...

eBay will NOT currently allow sellers to direct buyers to either a pro store or half.com, as they are both considered "outside eBay". However, I was told by eBay they are considering changing this rule.

all the best,

es