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My timing is horrible. I just upgraded from a premium store to an anchor store and opted for the yearly plan (ie it’s like a having a year contract). I wonder if they will let me drop back penalty free since they just changed pricing so dramatically.
@Sonia – actually my daily averages are $100 vs $275. So that’s 36%. In the past it’s usually been around 60% and never lower than 50%.
Before my current iteration of selling “paper” we used to do the wholesale model as well selling branded t-shirts (Superman, Simpsons, 100 other brands). From 2004 to 2007, we did well on eBay and got to about 300,000 a year in sales (with 30% profit margins). We started selling on Amazon as well which quickly dominated our time and we jumped to $800,000 in sales in less than a year. We had a great run for about 6 years and then the combination of more marketplace sellers and Amazon themselves competing against us gradually pushed us out of that line of products. At the end, we were still selling about 800,000 a year, but instead of 30% margins we were only getting 7% margins. It was way too much inventory risk (and work) for the amount of time were putting into it. I still have about 3000 dead stock t-shirts that I need to get up.
I guess there’s no perfect model. With paper, inventory costs are low but sourcing is hit or miss. With the wholesale model, sourcing is easy but you have to lay out big bucks for inventory and there’s always margin pressure.
That is so depressing. And, it only goes to show you that ebay customer service reps are hit or miss. The woman I spoke with told me it was cumulative FVF.
I usually pay between $0.25 and $1 per item. My average selling price for June was just over $10 per item and that includes a few large lots where I sold 50 or 100 (not valuable) magazines for $1.50 to $2 a piece.
The bane of my existence is whether to list an item for $12 and wait 3 years for it to sell or include it as part of a 10 item lot for $40.
But you’ve totally hit the nail on the head. It’s all about sourcing. Similar to you guys, I go to auctions, estate sales and private sellers and often buy a couple hundred magazines at a time. A third of them get thrown away, a third go into lots and a third are sold individually.
My goal is to raise the average selling price of my items from $10 to $30 – but I’m guessing I will have a harder time sourcing the quantity of stuff I’m getting now.
Here’s the reference on the eBay site.
It’s on this page
https://www.ebay.com/help/selling/fees-credits-invoices/store-selling-fees?id=4122About 2/3 of the way down the page it says “* Final value fees are capped at $250 in all categories for Anchor and Enterprise Store subscribers. For Basic and Premium Store subscribers, final value fees are capped at $350 in all categories, except Guitars & Basses (3858), Heavy Equipment (177641), Commercial Printing Presses (26247), and Food Trucks, Trailers & Carts (67145), where the final value fee is capped at $250. Maximum fee caps do not apply to the additional final value fees charged to sellers who are not meeting our performance expectations.”
Maybe I am mis-interpreting what they are saying, though. Maybe they mean an individual final value is capped at $250. So, if you sell a $10,000 item it’s capped at $250 (instead of it being $1000) and not that cumulative value fees are capped at $250.
It hasn’t been relevant for me until now as I am premium store subscriber and my final value fees (on items) have always been just below $350 (their stated cap).
Yeah. I know what you mean – it can be hard to comparing apples and oranges.
I’ve been selling almost continually for 5 years as a side hustle, although I recently took 6 months off when we moved from one state to another. Curiously, though, my sell through rate has remained about the same (~12-15%) while I grew my inventory from 500 to 1000 to 2200 items.
I pretty consistently source 300-500 items per month. In a slow month, I replace what sells and, in a heavy sourcing month, I add a couple hundred items to inventory.
Jay – you’re pretty transparent about your sales. If memory serves – you sell 35ish items a week (so 150 items per month) and have roughly 8000 items in inventory. So that’s 1.9%
I guess so much of it depends on how long tail your items are and, of course, whether you price high or low compared to the market.
Nope. What I mean is that your cumulative monthly (item) final value fees are capped at a certain amount based on the level of store that you have.
For example – if you sell 1000 items at $10 apiece in a category that has a final value fee level of 10% you would expect to have cumulative final fees of $1000 (1000 x $10 x 10% = $1000)
Now — if you had a premium store, your final value fees would be capped at $350. and if you had a anchor store they would be capped at $250.
The rub is that this final value fee cap supposedly only applies to the those FVFs associated with the item and not the ones associated with shipping. I’ll give an example. My final value fees are currently $350 for item final value fees and $120 for shipping final value fees. At my current premium store level, the caps don’t really save me any money. If I upgraded to an anchor store, I would save $100. If I embedded the cost of shipping in my item price, I would save $220 — provided that my sales didn’t fall as a result of the higher item price scaring buyers away.
Sorry – it’s little complicated to explain via text. Does it make sense now?
