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eBay Five Free Listing Changes

eBay isn’t what it once was. Month by month, we see fees increases, search result changes and tons of other factors that make it hard for the little guy, or even the larger guy to make a few dollars. As alternative sites like Chase The Chuckwagon gain steam, the incentive to list there decreases. The only problem is the sheer volume of users eBay has. Changes like this look good to most people, but the problem is that in my mind, most of the time it will actually be worse.

I had this forwarded to me this week, so I’m not sure what the original source is. However eBay is making the changes mentioned here, and it’s a great analysis of whats happening and how it will affect you.

Starting June 16th, 2009 your first five auction style
listings will not have insertion fees IF you list with the
Sell Your Item form on eBay. If you use TurboLister or
another listing program, you’ll pay regular listing fees.

For this examination, I’ll assume eBay tells us when a
listing will be one of the first five. If eBay doesn’t let
us know when we’d get the first five deal by listing
online, I’ll opt out of the program by using TurboLister
for all my listings with the single exceptions I mention
below.

This sounds like a good deal, but there is a catch. The
Final Value Fees on these free listings will be 8.75% or
$20.00 whichever is lower. On a regular auction the final
value fee percentage drops from 8.75% to 3.5% at $25.00.

This difference in the Final Value Fees means you’ll end up
paying more total fees for some auctions depending on the
ending price.

The variables here are the starting amount and the ending
price. Here’s a few examples:

If your item sells for less than $25 you’ll always save
money. This is because the 8.75% Final Value Fee for the
free listings is the same as the 8.75% fee for regular
auctions. You’ll save either 10, 25, or 35 cents depending
on the starting price.

What happens when your item sells for more than $25.00?

If you list an item with an opening bid below $1.00 that
sells for between $25.01 and 26.90 you will save up to a
dime. At prices above $26.90 you’ll spend more on total
fees.

If you list an item with an opening bid between $1.00 and
$10.00 that sells for below $29.76 you’ll save up to a
quarter. At prices above $29.76, you’ll pay more.

If you list an item with an opening bid between $10.00 and
$25.00 you’ll save money with ending values of $31.65 or
below. The most you’ll save is 35 cents.

If you list an item with an opening bid between $25 and
44.04, you’ll save money as long as your item sells for
less than $44.04. You’ll save less than $1.00.

If you list an item with an opening bid between $50 and
63.10, you’ll save money as long as your item sells for
less than $63.10. The maximum you will save is less than
$2.00.

The above examples of items selling for low prices aren’t
worth the hassle of using the online form. When you add in
the risk that your item might sell for higher amounts
resulting in higher fees, it’s a no brainer.

RECOMENDATION 1:

If you only use the online form for listing and sell items
with low values, list cheap items you expect to sell for
under $25 as your first five auctions.

If you use TurboLister or another listing tool, you won’t
be given the first five free, so you can ignore the
program.

WHAT HAPPENS WITH HIGHER PRICED ITEMS?

EBay caps the total fees on the first five listings at $20.
This meaning any listing that would normally result in more
than $20 in fees will be cheaper.

On any auction item that sells for more than $535, you’ll
save fees by listing it as one of the first five.

If you start a high priced item at a high opening bid the
selling point at which you’ll see is savings is lower
because of the listing fees being waived.

These points are:

First five items listed with opening amounts between $50
and 200 must sell for at least $476.72.

First five items listed with opening amounts between $200
and 500 must sell for $448.14.

First five items listed with opening amounts above $500 are
ALWAYS cheaper.

RECOMMENDATION 2:

If you sell mostly items for prices above $535, this
program will save you money. The higher the item sells for
the more you’ll save. Listing your item with a opening
bid above $448.14 as a first five auction always makes
sense.

Now lets look at some additional considerations. . .

SHOULD YOU CONVERT FIXED PRICE LISTINGS TO AUCTIONS?

For fixed price listings the starting and ending fees are
different for different categories. They vary widely, but
we can quickly determine if a fixed price listing would
result in lower fees if we ran it as one of the first five.

Here’s results by category:

In the Electronics category a first five auction becomes
cheaper at ending prices above $397.

Computers and Networking items are cheaper as fixed price
listings as long as the selling price is above $12.72. This
statement is different that the others because the final
value fees in this category for fixed price are always
lower than auction prices.

In Clothing a first five auction becomes cheaper at
$201.67.

In Books and Music a first five auction becomes cheaper at
$297.00.

In other categories a first five auction is cheaper at
$277.50.

All these numbers are lower than the recommended high range
fixed price listings values with the exception of the
Computers and Networking categories.

FIXED PRICE RECOMMENDATION:

If you’re using fixed price listings with prices above
these values you’ll save money by listing them as one of
your first five auctions with a high starting price.

Note: these fixed price versus first five amounts are lower
than the auction style versus first five listings because
fixed price listings have higher final value fees.

WHAT I’M GOING TO DO:

For most of my items, I am going to just continue listing
with Turbolister. Most of my listings end between $30 and
$500 so they will be cheaper as auctions with low opening
bids.

I have some thinly traded expensive items that I won’t list
as in regular auctions because they might not get enough
bids. To list them with a reserve or high opening is
expensive so I’ve been listing them with fixed prices and
best offers, and slowly selling them when I get acceptable
offers. Some have been listed 10 or more times already
which is why the fixed price alternative makes more sense
than just running auctions.

By listing these items online as one of my first five I’ll
save quite a bit on fees if they sell.

If eBay doesn’t tell me when I can list my first five
auctions, I’m going to use a second eBay account to list
just five of these higher priced items a month. If I have
seven expensive items, I’ll use a third eBay account.

Also any items I expect to sell for more than $535, that I
would list as a regular auction with a low opening bid I
will either run on a second account to insure I get the
lower fees, or attempt to schedule as the first five on my
main selling account.

Based on my new behaviors, this program makes sense. EBay
will be able to report additional active selling accounts
to Wall Street. They will also get additional fees from
users who sell items that end at the wrong prices.

There’s definitely some info there to think about. Opinions, or know what the source is? Feel free to comment below.

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