Contents
eBay Basics
How to Decide What to Sell on eBay
How to Budget Your eBay Business
How eBay Selling Works
How to Choose an eBay Listing Format
How to Choose an eBay Listing Price
How to Choose a Listing Timeframe
How to Improve Your eBay Listings
eBay Payment Methods
eBay Shipping Methods
Tools to Improve Your eBay Selling
How to Set Up an eBay Store
Customer Service for eBay Sellers
How to Run Your eBay Business
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How to Budget Your eBay Business
eBay makes most of its money by charging sellers a variety of fees (buyers, on the other hand, can use eBay for free). As you start selling on eBay, it’s a good idea to build a budget to help you track fees you pay for selling on eBay and other costs you’ll incur in running your business.
Fees You Pay to Sell on eBay
As an eBay seller, expect to pay three main types of fees: insertion fees, final value fees, and PayPal fees. (The following fees were current as of this guide’s publication date but are subject to change.)
Insertion Fees
Insertion fees are one-time charges you pay to list your merchandise on eBay. The insertion fee increases as the starting price you set for an item increases. For instance, an item with a starting price of $10 may have an insertion fee of about $0.55, while an item with a starting price of $250 may have an insertion fee of about $3.00.
Final-Value Fees
You pay a final-value fee only if your item sells. The final-value fee is a percentage of the price at which your item sells. The percentage decreases as the sale price increases. The following table shows how final-value fees work:
Selling Price |
Final-Value Fee |
|
$0.01–$25.00 |
8.75% of the sale price |
|
$25.01–
$1,000.00 |
8.75% of the initial $25.00 ($2.19), plus 3.50% of the remaining balance of the sale price ($25.01 to $1,000.00) |
|
$1,000.01 or more |
8.75% of the initial $25.00 ($2.19), plus 3.50% of the initial $25.01–$1,000.00 ($34.12), plus 1.50% of the remaining balance of the sale price ($1,000.01+) |
PayPal Fees
eBay will charge you a fee if your buyer pays with PayPal, eBay’s proprietary electronic payment service. A PayPal fee is assessed as a percentage of the total value of each sale, plus a nominal fixed fee of $0.30. The percentage decreases as your sales increase. For instance, eBay charges a 2.9% fee for monthly sales up to $3,000 but only a 1.9% fee for monthly sales over $100,000.
Checking Current eBay Fees
From time to time, eBay may adjust its various fees. To check eBay’s current fees, click on eBay.com Fees under Selling on the Help page.
Other Costs Involved in Selling on eBay
In addition to sellers’ fees, all eBay sellers incur merchandise, packing, and shipping costs:
- Merchandise costs: Cover buying or making the items you sell on eBay
- Packaging costs: Cover packing materials, such as Styrofoam peanuts, bubble wrap, and boxes
- Shipping costs: Cover shipping fees for sending your items to buyers, including optional services such as shipping insurance and delivery confirmation
eBay sellers almost always pass shipping costs directly to buyers by including a shipping charge in their listings. This charge sometimes includes packaging costs as well. You may also incur the following expenses depending on the size of the items you sell and the volume of your business:
- Third-party software: Third-party auction management software helps you create and oversee your listings. It costs $5–30 or more per month.
- Website hosting: To store the photos you use in your listings, you’ll likely want to rent space from a web hosting service. Expect to pay $5–10 and up per month.
- Storage space: Some eBay sellers store their merchandise at home, while others rent private storage spaces or warehouse space. Prices vary widely based on location, but for starters you can rent a 10' × 10' private storage space for about $100 per month.
- Fulfillment costs: Some eBay sellers pay for fulfillment services to pack and ship their items for them. Warehouses often offer these services for an additional fee to clients renting space in their facility.
Building and Implementing Your Budget
A basic eBay business budget should allow you to compare your revenue, or income, and your expenses to determine the overall profitability of your business.
- Revenue: The sum total of the selling prices of items you sell, not including any expenses
- Expenses: The fees you pay to sell on eBay, plus any additional costs you incur
The best way to monitor your business’s profitability is to keep track of all revenue and expenses by using a spreadsheet program, such as Microsoft Excel, or a more robust bookkeeping program, such as QuickBooks.
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