Ebay "no insertion fee" auctions - good or bad deal? HOW TO LOWER your Ebay fees now

[Modee]

Fees for selling on eBay

The usual deal with EBAY is that you pay a small insertion fee
Insertion fees
for your auctions (ranging from $0.10 to $4.00), and then if it is a typical auction (not fixed price sale), you pay a certain percentage (a "final value fee")
Final value fees
based on the end selling price:
8.75% of the first $25., plus 3.50% of the amount from $25. - $1000., and another 1.50% for any amounts over $1000.

But lately EBAY is offering this free insertion deal
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for the first 5 eligible auctions listed during a thirty day period. (Which pretty much means, for most of us, the first five auctions, period.)

All no insertion fee auctions are charged a final value fee of 8.75% of the entire amount due, or $20., whichever is less.

Before assessing which auctions are eligible, let's examine whether or not this is even a good deal.

Now, if you are selling an item under $25., this is a no brainer - since the final value fee is 8.75% either with or without the no insertion fee deal, you will wind up ahead by saving on the insertion fee. So if the item you sell is $25. or less, you naturally want to avoid the insertion fee since the final value fees are the same whether you are placed into the "no insertion fee" category or not.

And then, if your item is rather expensive, say $2000., then your final value fees in the normal category would definitely be more than $20., so that's a no brainer too - best to get placed into the no insertion fee tier. (Since the maximum final value fee in the "no insertion fee" category is $20.)

But what if your listing is in between? For example, what if you are selling a $200. item?

Well, in such a case, in the normal category your fees would come out to:
$0.35 insertion fee
$2.19 final value fee for the first $25. @ 8.75%
$6.13 final value fee for the last $175. @ 3.50%
For a total of $8.67

NOW, if you did this under the "no insertion fee" category, your fees would be:

$0.00 insertion fee
$17.50 final value fee (8.75% of $200.)

Now, that is quite a difference! DOUBLE.

Now the question is, what is the cut off point? At what dollar values is it better to go with the regular auctions versus the no insertion fee auctions (assuming, that is, you have a choice in the matter! - but in some ways, you do! (see below)).

Well, without getting into the algebra (or calculus depending on how fancy you want to get) needed to determine this quickly, the answer is (assuming an insertion fee of 35 cents):
Above $31.67, but less than $523.93, you are better off going with the regular auctions.

So if your auction ends at $31.67, it would cost you the same - $2.77 - either way.

But if your auction is say, more than $31.67, but less than $523.93,
let's say, $500., with the no insertion fee method you would pay the maximum $20. (actually $19.99, but for our purposes we will just say $20.) -
And with the regular way you would pay the $0.35 insertion fee + $2.19 for the first $25., plus $16.63 for the remaining $475. for a total of $19.17

And the difference between the two forms of auctions gets worse, as noted above, for auctions that are, for example, in the $200. or so range. Some fancy calculus or statistical analysis would show you where the "no listing fee" auctions are the WORST deal, but for our purposes, let's just say that this happens around the $200. range.

So - considering that the first five auctions during each 30 day period are automatically placed into this "no listing fee" auction fee calculation category,

SO, if your item is going to sell for more than about $32. but less than about $524., you are better off just paying the listing fee (assuming it is 35 cents) rather than going for the no listing fee deal. The no listing fee auctions become the WORST deal around the $200. closing price range.

And if your item is over $524., especially much over, you are better off with the no listing fee deal.

BUT AT THE END OF THE DAY, what does this mean to us? If EBAY is going to just pretty much assign the first five of the eligible auction type listings (Except for motor vehicles, real estate and certain types of commercial heavy machinery and equipment) during a rolling thirty day period to these "no listing fee" categories, then what difference does it make if we know for which dollar amount auctions we will wind up ahead, and which we will wind up behind, fee-wise?

Well, if you sell less than five items per thirty day period - then there is no benefit in knowing or not knowing how your fees will be calculated - all your auctions will end up in the "no listing fee" category.

BUT, if you list more than five auctions per month (which most all of us, being heavy EBAY sellers do), AND they fall into more than one of the below ranges:
A. Below $32.
B. Between $32. to $524. range
C. Above $524. range,

(in other words - if you sell items that fall into different price ranges)

then there are things you can and should do to try and manipulate your listings.

First of all, if you can figure out which five auctions are being placed into the "no listing fee" category (that is, which are the first five auctions of a given thirty day cycle), you can determine WHICH ORDER you should submit auction listings to try and keep some in or out of the "no listing fee" category.

AND, if you run multiple EBAY accounts, you might want to stagger the more expensive listings to be sure to land into that "no listing fee" category (and, to try and land OUTside of that category if they are say, around the $200. range especially). In other words, you can use multiple EBAY accounts to your advantage to try and pay lower fees on your auctions.

Now both of these methods require a bit of work, and they are not worth it unless we are talking about saving some real money. But, first of all, why give EBAY anything more than they deserve?

I mean, why pay $17.50 fees on a $200. item when all you have to pay is $8.67?

Or, why pay $66.66 fees on a $3000. item by the regular method when you you could pay the flat rate maximum $20. if it lands in the "no listing fee" category?

So you can see, that you can save hundreds of dollars if not much more really on an annual basis in EBAY fees (assuming you pay any fees at all - which my methods to not pay fees still seem to work), by just timing your listings the smart way.

Good luck - and don't ever assume that EBAY has your best interests at heart! when it comes up with these new ways to "pay less fees." Just like gambling games where it appears that the house is giving you an edge (such as, for example, open card blackjack where both of the dealer's cards are dealt face up), at the end of the day the house has figured out some way to wind up ahead. EBAY is no different! So, be careful.

[Modee]

Starting March 30, 2010 selling on eBay will be a better deal than ever!

List Auction-style FREE--no Insertion Fees--when you start your Auction-style listing under $1.

Get new, lower Insertion Fees for all other start prices.

Either way, pay one easy Final Value Fee of 9% of the winning bid (but never more than $50)-and pay only if your item sells.

List in Fixed Price for 50¢, with Final Value Fees for the most part staying the same.
This new standard fee structure will replace the current "first 5 listings free"--you'll pay no Insertion Fees whenever you list Auction-style and start pricing under $1!*

In other words, now you can control whether you want the "no insertion fees deal" by putting your starting price above a dollar (say, at $1.01).

Complete details here
eBay.com : 2010 Spring Seller Update

[Modee]

Especially to PowerSellers, Ebay is making a lot of phone calls lately to offer phone appointments to go over your selling practices and to determine how best to lower your Ebay fees.

This is a call that could be helpful to you, but just as important, make sure your phones work and are not disconnected or mere voicemails! Missing even one call from EBay or PayPal can result in issues for your account.