Q&A: Why sell books on Amazon, when eBay's fees are lower?

QUESTION: I'm new to bookselling, but have been collecting for years. I need to start clearing some space. I've been selling in an antiques mall booth, and researching the different online venues.

My calculations show Amazon is one of the more expensive sites. I used a benchmark of selling 50 books a month for $10 each:

Amazon fees (non Pro-Merchant) = 50 x .99 = 49.50
Amazon commissions = .15 x 500 = 75.00
Amazon total = 124.50

eBay fees = 50 x .60 = 30.00
eBay commissions = .0525 x 500 = 26.25
eBay total = 56.25

I am working on a function to show the graduated fee structure of eBay, but it should show much slower increase than the straight fees Amazon charges, regardless of the book's selling price.

Have I missed something? Is there some advantage to being on Amazon, besides lists, customer reviews, etc.? Both sites show up on Bookfinder.com. I feel that an honest book seller, who does everything they can to accurately describe and picture collectible books on eBay can do just fine, yes?

Also, I can show as many pictures of a book as I want on eBay, participate as a Buy-it-Now seller, through timed auction and through live auctions.

ANSWER: You raise some good observations.

All the major online bookselling sites keep a generous share of the proceeds, but I believe it's a fair trade. Those sites attract the customers that enable us to operate a business with no advertising expenses, and practically no risk. Compare that to running a brick-and-mortar bookstore, or selling in an antiques mall, where you must pay the rent whether you make any sales or not. If there aren't enough sales, you're out of business -- and in debt to boot.

Also, it's quite likely your profitability would be better running an online store. Your costs per square foot can be much lower with an online store, of course, and you have access to the worldwide market.

As to Amazon versus eBay, I concede that eBay today is a superior selling venue for certain types of books -- particularly collectibles that require pictures of the actual book and a detailed description of the condition, faults, etc.

But I'd argue that for most booksellers with general stock, Amazon allows you to sell at a higher volume, at a higher velocity, and with less customer-service issues than eBay. The time you spend hand-selling each commodity book on eBay costs you time, and time is money too.

So if you calculate your time and aggravation, you might find that Amazon is cheaper, depending on your particular business.

For example, a couple of years ago I did a little experiment -- on the books I had in quantity (I also sell new books) I listed my inventory on both Amazon and eBay. On eBay, I used a Buy-it-Now price close to my "like new" price on Amazon. On some of the cheaper books I auctioned them starting at 1 cent.

I did this for about four months, and was able to generate about $1,500 to $2,000 in revenue from eBay per month -- a fraction of my take from Amazon, but then I didn't have nearly as much inventory listed on eBay.

But I was surprised to find out that my costs -- eBay fees, PayPal fees, etc., added up to nearly 10 percent of the revenue I was getting out of eBay. My assumption going into my experiment was that eBay would be a bit higher-maintenance although cheaper -- but it wasn't. eBay was nearly as expensive, and required much, much more specialized attention than Amazon. There were many more customer inquiries (most of them idiotic, such as questions about shipping terms that were clearly explained in the listing, and "where's my book?" e-mails when I'd already e-mailed a shipping confirmation with a tracking number. I tried to keep things simple by accepting only U.S. PayPal transactions, but this resulted in constant inquires from customers around the globe who wanted to send checks, money orders, wire transfers, or cash).

To be sure, Amazon produces problems customers, but on a per-capita basis I got three times as many headaches from eBay sales -- and non-sales. So I didn't think that the slight savings in fees on eBay justified the extra time and aggravation. I probably could have fined-tuned my eBay selling to get the costs down a bit, but just didn't have the motivation.

But, like I said, your mileage may vary. I don't have that many collectible books. If I did, I'd be happily hawking my wares on eBay.

All this is not to say the average seller should ignore eBay. Even though I don't prefer it, I think eBay is a valuable counterweight to Amazon. It's a decent alternative, and that every seller should have an active account there and stay current.

I don't like putting all my eggs in one basket, and don't recommend it for anyone. And if I ever need another basket, it'll probably be eBay.