Friday, June 18, 2010

Turning point for the Ebay store

So, the store is hitting a crossroads again, and it is time to figure out what the intentions are. It has been fun having the store around, but the problem right now is this...

When the store opened, my brother and I had just sold all of our N64 games and system for roughly $250. The store fees were $15 per month, and that allowed you to list 250 items in your store inventory at $0.05 per listing. These listings would then last 30 days, before being relisted and charging an additional $0.05. Not a big fee. When the item sold, you would pay the ebay fees as usual. I was finding that for the popular book titles, like Batman, the title would usually last about 2 months. This would mean the fee would be about $0.10. There were also many other titles being offered, and they would typically be on the market for a good 4-6 months, some have never sold. So, these texts slowly rack up fees, but someday they may sell, and even if they sit there for 2 years, it would cost me $1.20. The average amount I making on a book is just a bit over $2, and the books cost about $1. So, if the book sits for 2 years, I roughly break even. I still think it looks better to have a big store inventory rather than remove titles.

Fastforward now to the present day, and ebay's new fee structure. For the basic store plan, it now costs $0.20 to list the items, with relisting every 30 days. The fees quadrupled!! For these books where I am trying to make just a little profit on each, this fee hike is killer. I just sold a book that was listed on Monday night. The title went for $4, including shipping. Shipping cost $1.90, and the ebay fees, including paypal, added another $1.10. This meant that I got $1 for the book, which cost me just about $1. So in other words, a book that sold in its first listing, profited virtually 0, whereas before it would have at least profitted something. Granted this was a non-Batman title, so the price was lower, but still.

So, can my model work? I am thinking not. To get the fees back to the $0.05 listing price, you need to upgrade to the $50/month store, which is significant. I think, sadly, this may spell the end of my ebay store, unless I can find a new business model quickly.

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