I've had a couple of days now to digest eBay's first announcement of 2010, and to hear what other sellers are saying about how those changes are going to affect their business model. I've taken some time to crunch the numbers for my own business, and to try to figure out at least a basic plan for how I am going to handle the new structure.I have a few thoughts about how the new stores in core change, as well as the new fees, could impact antiques and vintage collectibles sellers, and there are a few things we might need to consider changing once April 1st rolls around... But, let's start at the beginning.
I think it is safe to assume that for most vintage sellers, fees are going up. How much they are going up is the question - and that depends on how you handle the new structure, and how many items you list or have in your store on a regular basis. eBay's fee illustrator is helpful if you haven't tried crunching the numbers yet.
For me, with 800+ store listings, upgrading to the Premium level and getting the $0.05 listing fee is a no brainer - I'm looking at about a $50 a month increase, but when you subtract $15 for Selling Manager Pro, which is free with the Premium level store, it is really only a $35 increase.
Not too bad - in fact way better than what I was expecting! When you add into that the reduced auction listing fee, the extra $35 becomes even less depending on how many auctions I run a month.
But here is the thing that I have really been pondering the most in the last day or so - why do I run auctions?
The Benefits of Running Auctions
1. Bidding wars - On highly desirable and/or rare items, bidding wars can drive the price of an item up significantly.
2. Exposure for items in Core search - Auctions show up in the main search, where they get more exposure, and also help drive traffic to your store inventory items.
3. Best Match - Auctions get a boost in Best Match toward the end of the listing period.
4. Lower final value fee - 8.75% vs. 12% for store items
Now, what is changing with the new store items in Core scenario? Well #2 ceases to be a benefit of running auctions right off the bat. #1 is a pretty rare situation these days - the majority of my auctions end with just one or two bids.
Side note on the free under $1.00 starting bid auctions - who starts their auctions that low anymore? It's too risky, unless you have a super rare item... I rarely start one under $9.95, and only if I can live with the item selling for only $9.95!
Anyway, here's my point. With store listings in Core, running a ton of auctions might not be so necessary anymore. Unless you are fairly sure the item will get more than one or two bids, why not just list the item for a fixed price? You can even price it high with a Best Offer option and still end up doing well, and for a $0.05 per month listing fee rather than a $0.25 per week listing fee...
Lets do a bit of math and see how it breaks down - lets just do a $9.95 item:
$9.95 start price auction - $0.25 to list, 87 cent final value fee
$9.95 start price FP30 - $0.05 to list, $1.19 final value fee
So for $0.32 more, your item is listed for a full month, rather than a week. Subtract the 20 cents difference in listing fees, and that number becomes $0.12.
See what I mean? When you factor in the fact that you can probably sell that $9.95 item for $11, $12 or even more at fixed price (I do it all the time - auction for $9.95 ends with no bids, but item sells out of my store for higher later on down the line...) then the auction is pretty pointless.
But, #4 remains a viable reason though - auctions do get a bump in Best Match toward the end. The question is if that bump is worth it or not, in the grand scheme of things...
Remember in my last post when I said that we were in for some serious math, and a re-thinking of our business models? This is what I mean! I still haven't worked it all out, and it could all change once we get into it and see how things are going to sell once all items available on the site are listed together in Core.
What I do know for sure is that it is time, now more than ever, for every one of us who sells uniques on eBay to take a long hard look at why we do it, what level we want (or need!) to be at, and the bottom line as far as dollars and cents goes compared to the time, effort and energy it takes to sell on the site. The answers - and numbers - will be different for nearly everyone - I referred to my own situation here only because it is what I know and understand the best...
I hope throwing a few of these things out there is helpful to some of you - and I would LOVE to hear your thoughts about the changes, and your own plans for dealing with them - feel free to leave a comment or ten ;)
