Regardless of changes, this eBay business is thriving

This article was originally printed in Antique Trader
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Over the last months, we have read the dozens of complaint letters concerning eBay with interest. As a fellow antiques seller specializing in furniture and small decorative and collectible items who has reached Platinum Power Seller status on eBay, we can honestly say that our sales (and profits) on eBay are trending upwards. Even during the worst of the recession, we still found sales on eBay to be consistent.
Letter to the editor: Regardless of changes, eBay business is thriving
While we are certainly not fan of eBay’s feedback system that gives far too much power for the occasional unreasonable customer to affect a seller’s search position and fee discounting, it seems that much of the discontent that we read in your Letters to Editor indicates that eBay somehow owes its sellers something. While it is true that the sellers pay eBay’s fees and are, in effect, its customers, eBay is a publicly-traded company that exists to maximize the return on their stockholders’ investments. As a result, eBay’s management team makes the decisions that it thinks will do that. Of course, not all of eBay’s decisions are going to be viewed by all parties as positive, but our experience with eBay has been that if we roll with the changes, our business continues to thrive.

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As an example, when eBay decided to tie search rankings and fee discounts to feedback percentages, we started looking at a potential customer’s feedback left for others prior to accepting their final bid or taking their offer to protect our ratings. We also occasionally read the Power Seller forums and block bidders who have been reported as problem customers. Additionally, we sometimes identify potential unreasonably-high-maintenance customers based on the questions they submit, and block those types of customers as well. While this is not a perfect system, it is simply a change to our business practices that we made to counteract eBay’s feedback policies. So far, it seems to have worked well.

A couple of years ago, we made a big push to begin offering “Free Shipping” on all of our items. As anyone with any common sense knows, “Free Shipping” is nothing more than increasing the price of the item to cover the shipping expense. We knew at the time that eBay would benefit by being able to charge Final Value Fees (FVF) on that increase in sales price, but we have found that the sales psychology of offering “Free Shipping” to our customers has certainly more than made up for the increase in fees. Customers constantly send us comments about how happy they are with the “Free Shipping.” Amazon offers “Free Shipping” for orders over $25 and I think no one would argue that their business model has not been successful. We have read in the letters that increasing prices to cover the extra shipping costs and FVF for many sellers is not an option.

However, we have simply found this not to be true. We have found that our thorough descriptions, high-quality photos, and excellent feedback sell the items, not price. Antiques is a business where none of our customers “needs” anything we sell. Rather, the antiques business sells on desire and emotion, and we try to make our listings cater to that.  

However, where certain items become no longer profitable due to fee changes or market forces, we have simply stopped dealing in that type of item or move it to other websites where it is profitable. We have utilized QuickBooks heavily to maintain our sales information to help us identify market channels or product lines that simply are not working as desired.  

It may be that eBay’s policy decisions will ultimately be its end, but that’s true for any business. As eBay changes, fellow dealers can either reevaluate their business and make the changes required to continue to sell profitably or not. In the meantime, we will be happy to take the market share left by the dealers leaving eBay.

Richard Saunders
Knoxville, TN

We’d like to hear what you think. Send your comments on eBay’s policy and fee changes to eBay Changes. -Editor

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