Ebay Pushes FedEx Shipping and Encourages Sellers to Take a Loss
When I first joined eBay, back in the late 90’s, it was all about the one-off auction. It was the place to go for a Lost in Space lunch box, a mint-in-box Barbie, or a rare Frankenstein poster. Back then, the majority of sellers were individuals looking to clean out their attic and make a little cash. It was the ultimate, online, treasure hunt for collectors like me.
While you still find this type of item on the site, they’re now buried under 50 listings of the same new DVD release, wholesale electronics, even listings from major retailers like Toys R Us.
That Teenage Mutant Ninja Turtles Lair is pretty cool, but still, I don’t like this trend. With every step, eBay moves further and further away from their roots and closer and closer to becoming Amazon.com.
Now, they’ve announced a partnership with FedEx that sounds like a great deal for everyone involved, but is it? This holiday season, eBay will be offering FedEx shipping at a discounted price - up to 37% off – with home printing of delivery labels. That’s a nice move. FedEx has a great reputation (mostly) for delivering goods quickly and the discount will make it affordable — for the buyer. eBay VP Carl Gish had this to say about the seller side:
“We’ve been asking sellers to meet buyer expectations of free shipping and tracking. It’s something our sellers have been asking for for a while, given that we have USPS and UPS. FedEx, as a major player in that space, is clearly a great partner for both our buyers and sellers.”
Shipping costs have always been a point of contention on eBay. Originally, eBay didn’t charge end of auction fees on the shipping portion of a sale. That led to fee avoidance auctions where a person sells a DVD for $1.00 then charges $20.00 shipping. Now, eBay figures their cut off the entire sale price including shipping — dollars that the seller doesn’t get to keep because they have to pay it out to the post office.
Given that, it’s surprising that eBay is pushing sellers to offer free shipping because that will eat into the final value fee. And it’s not just free shipping, FedEx also wants two-day service and delivery confirmation to compete with Amazon.
eBay isn’t Amazon. I’m sure they’d like to be, but I miss the days when a bored guy in an office could sell a pencil for $500. That’s the kind of entrepreneurial spirit that made eBay what it is today.
ETA: Changed to reflect that eBay does indeed charge a final value fee on shipping – thanks Tiffany.