Q&A: Why do booksellers tolerate Amazon's high fees?
QUESTION: With seller fees so outrageously high on Amazon, why don't more booksellers do business on eBay? Amazon charges 15 percent, while eBay's final value fee is only 5.25 percent.
ANSWER: The total fees on eBay are more than you might expect.
About 18 months ago, I opened an eBay Store, put most of my inventory there, and was able to generate about $2,000 a month in gross sales. My objective was simply to see if eBay would be a worthwhile sales venue for me. I used a combination of fixed-price listings for my faster-moving, newer books, and auctions for some deadwood I wanted to clear out.
After about four months, I took a good look at the numbers, and was surprised to discover that eBay and PayPal fees were eating up 12 percent of my eBay sales. Since eBay selling required so much more time and attention compared to Marketplace, I closed my eBay Store. And the bottom line was, the prices I was getting for my books on eBay was, on average, less than the going prices on Amazon Marketplace.
Amazon does take a generous commission, but you should remember the main benefit you're getting in return: the ability to operate a business with no advertising costs and very little risk.
There's a good discussion happening on the eBay bookseller board this week about this very topic, and this post caught my eye:
It will be interesting to see if eBay's fixed-price Express platform will change the equation. I suspect Express will be a worthwhile venue if it enables Store owners to sell their newer books for better prices than we're seeing on Marketplace now.
During the past two weeks I've sold five books at fixed prices on eBay for about 25 percent more than the going price on Amazon. Based on that experience, I'm going to re-open an eBay Store and test the waters again. No doubt, traffic will increase on eBay this spring or summer when the advertising campaign for Express hits the airwaves.
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ANSWER: The total fees on eBay are more than you might expect.
About 18 months ago, I opened an eBay Store, put most of my inventory there, and was able to generate about $2,000 a month in gross sales. My objective was simply to see if eBay would be a worthwhile sales venue for me. I used a combination of fixed-price listings for my faster-moving, newer books, and auctions for some deadwood I wanted to clear out.
After about four months, I took a good look at the numbers, and was surprised to discover that eBay and PayPal fees were eating up 12 percent of my eBay sales. Since eBay selling required so much more time and attention compared to Marketplace, I closed my eBay Store. And the bottom line was, the prices I was getting for my books on eBay was, on average, less than the going prices on Amazon Marketplace.
Amazon does take a generous commission, but you should remember the main benefit you're getting in return: the ability to operate a business with no advertising costs and very little risk.
There's a good discussion happening on the eBay bookseller board this week about this very topic, and this post caught my eye:
I sell 10 or more books on Amazon to every one on ebay and half. It doesn't matter to me what their fees are - I wouldn't be in the book business without them. I love being able to add to their database. Prices are usually higher on Amazon than ebay - I guess people go there expecting to pay retail and are happy to find a bargain. (Here's the whole thread.)
It will be interesting to see if eBay's fixed-price Express platform will change the equation. I suspect Express will be a worthwhile venue if it enables Store owners to sell their newer books for better prices than we're seeing on Marketplace now.
During the past two weeks I've sold five books at fixed prices on eBay for about 25 percent more than the going price on Amazon. Based on that experience, I'm going to re-open an eBay Store and test the waters again. No doubt, traffic will increase on eBay this spring or summer when the advertising campaign for Express hits the airwaves.
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posted by Steve Weber at 5/16/2006
2 Comments:
Another point in eBay's favor is that the seller sets the shipping charge and keeps the entire amount, which offsets the PayPal fees a bit. It's frustrating that Amazon keeps $1.00 of the $3.49 shipping charge. Until two months ago we hardly bothered with eBay. Now I wouldn't be without our eBay store. It's helped keep us afloat during a dry sales period. We have twice as much inventory listed on Amazon than on eBay, yet our sales on eBay have been higher. Go figure. Being involved in both venues makes one a better bookseller, I think, because you develop different skills. And it keeps you from putting all your eggs in one basket, which is important in this ever-changing book business. --Anita
We're just getting started selling on Amazon, and have had issues with our account not being functional all the time. We use a combo of Amazon for higher priced books, and Ebay to move lower priced collectible books. Most of our books are listed in the Anitiquarian and Rare area. We recently found a 1st edition Where the Red Fern Grows at a book sale for $1, and sold it on Ebay for $60 more than what the going price on Amazon was. Somtimes you get lucky and hit two bidders who really want the book.
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