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Understanding eBay Fees

Navigating the path to financially smart listing
understand-ebay-fees

New eBay sellers can easily fall prey to high eBay fees because 10 cents here and 15 cents there just doesn’t seem like much to the novice when listing items to such a massive audience.

Those who have been around a little longer know the importance of understanding eBay fees and working within the system to get the most out of their listings. If you’re a new seller—or perhaps an experienced seller who just needs a refresher course—here is a look at current eBay fees for non-store owners, and how to work with them.

Insertion fees

The first fee a seller gets hit with is the insertion fee, which basically buys you the opportunity to list your products on a platform with a worldwide audience. There are a number of other online selling sites available—and they may have lower selling fees than eBay—but none yet reaches the sheer number of buyers that eBay does.

For listing an auction-style format on eBay, insertion fees start at 10 cents if your opening bid price is less than $1, and can go as high as $2 for bids starting at $200 or more. It’s important to familiarize yourself with the eBay fees scale when listing your products. If you want to sell something for $10, for example, your insertion fee will be 50 cents. But you can cut that fee in half if you simply start your bid price a penny lower at $9.99.

If you list something for $10, your insertion fee will be 50 cents. But you can cut that fee in half if you start your bid price at $9.99

eBay also allows sellers to set a reserve price for those who want to start the bidding low—which eBay recommends to attract more bidders—but also want to guarantee they’ll receive a certain minimum price for their product. If a seller sets a reserve price, then the insertion fee will be based on the reserve price, not the starting price.

If listing in the auction format and adding the Buy it Now option, an additional charge will be added to your insertion fee, which will range between 5 cents and 25 cents, depending on the Buy It Now price. When listing in fixed-price format, the insertion fee is a flat 50 cents for any listing priced at 99 cents or more. eBay Store owners pay less for fixed-rate insertions, from 3 cents to 20 cents, depending on subscription level.

Currently, eBay waives insertion fees on the first 50 auction listings per month for sellers without an eBay Store. Another perk eBay offers is an insertion-fee credit for the first relist if your item doesn’t sell. Also, some categories have different insertion fees, and some cannot be applied to the 50-free-per-month. These include listings for Real Estate, eBay Motors, Business & Industrial, eBay Stores and Classified Ads.

Listing Enhancements

eBay fees can add up when a seller wants to add bells and whistles to a listing. Enhancements eBay offers include a three-day listing extension, adding a subtitle, listing in bold font and more.

10-day duration $0.40 auction format, free for the fixed-price format
Subtitle $0.50 auction format, $0.50 to $1.50 fixed-price format
Bold $2 auction format, $2 to $4 fixed-price format
Gallery Plus* $0.35 auction format, $0.35 to $1 fixed-price format (*Free in certain categories, including collectibles, art and antiques)
Scheduled Listings $0.10 auction and fixed-price format
Listing Designer $0.10 auction format, $0.10 to $0.30 fixed-price format

eBay also offers a Value Pack for 65 cents in auction format and 65 cents to $2 in fixed-price format. The Value Pack includes Gallery Plus (a feature that enlarges your gallery image), Listing Designer templates and Subtitle features for a discounted price that saves between 30 cents and 80 cents.

Final Value Fee

The cost to sell on eBay includes a percentage of your transaction, which eBay calls a final value fee. This is where estimating your eBay fees can get tricky. While you can know your upfront costs, based on your starting price and add-ons, you can’t always predict what your item will sell for, if it’s listed as an auction.

How much you final value fees will be depends on which format the product was listed under, which category the listing was under and the total amount of the sale.

The auction format is an easy calculation. eBay takes 9 percent of the total sale—or 7.5 percent for eBay Store owners—but not more than $250. For fixed-price listings, the calculations are based on category and total sale price.

Electronics 7% of first $50, plus 5% of next $50-1,000, plus 2%
of any remaining profit
Clothing, Shoes, Accessories 10% of first $50, plus 8% of next $50-1,000, plus 2% of any remaining profit
Books, DVDs, Music, Video Games 13% of first $50, plus 5% of next $50-1,000, plus 2% of any remaining profit
All other categories 11% of first $50, plus 6% of next $50-1,000, plus
2% of any remaining profit

Payment Processing Fees

PayPal is the preferred payment method for many eBay buyers and sellers. PayPal is a third-party payment processor that is owned by eBay and can be linked to your eBay account for quick payment processing.

Once a seller receives the Top-rated Seller status, they begin getting perks, including the opportunity for discounts on eBay fees

Like most payment processors, PayPal charges a fee for every transaction a seller makes. Fees from most third-party processors are roughly 2.9 percent, plus 30 cents per transaction.

Top-rated Seller Discounts

Sellers who have reached Top-rated Seller status earned this badge by meeting certain requirements set forth by eBay. In short, they sell a consistent volume of products and consistently receive high feedback scores.

Once a seller receives the Top-rated Seller status, they begin getting perks, including the opportunity for discounts on eBay fees. Top-rated Seller listings that have a one-day handling time and a return policy of 14 days or more will receive a 20-percent discount off the final value fee.

Other perks for these sellers include USPS discounts, improved standing in Best Match search results and expanded seller protection.

Understanding eBay fees helps sellers to be fiscally smart with their pricing and listing decisions. eBay even provides a fee calculator so sellers can figure costs before going through the listing process.

Selling on eBay doesn’t have to come at a high price tag as long as the seller understands where and when eBay fees are applied, and how much value they add to their listings.

About the author

Sarah Brown
Sarah Brown is a freelance writer who writes about e-commerce and small businesses. She recently graduated from Chico State with a journalism degree and is also a budding online entrepreneur, having launched two Web businesses and her own line of handmade products. Opinions expressed here may not be shared by The Online Seller and/or its principals.

  • bonnie

    I am starting to think that maybe, just maybe I am liking Etsy more and more. It may be a smaller selling audience but for my items I think it may work better. Ebay fees are confusing and they give way to much power to the feedback. A bad day for one person can cost a good seller a rating they have worked very hard to achieve. And I did not know that Ebay owned Paypal now that makes things a little more clear for me. Thanks so much for the helpful info and keep up the good work. Bonnie

  • terramax

    The writer forgot to mention that ebay also takes a percentage of the shipping fees.

  • steve-o

    You forget the fees ebay now charges the seller on shipping as well. One more way to rape the seller. I recently rec’d $5.97 from a buyer and after all the fee’s and shipping my net was $3.64. Ebay & shipping takes 44%?!?! (I charge a fair $1.95 in shipping, then ebay .27 takes on shipping, actual postage is $1.64 = total of $1.91) where can I buy a padded envelope and get it to the post office for .04?!?!?

  • Jan

    Did you see the fees that are charged by ebay and paypal? This is why there’s such an uproard within the selling community of ebay. I’m a or was a top rated seller but because of this same day ship requirement, I don’t make anything selling in ebay. This is not a joke. I made a lousy $1.32 off an item that sold for over $300. Ebay forgets that the seller has to purchase or dropship the item, so we have to pay for the products or items. This includes the shipping charges that the supplier charges the seller to ship the item to the buyer. This process takes at least 2 days and then a shipping label is generated and shipped. So there is no way on this earth that a seller could ship same day unless that supplier has the offer of same day ship in their charges and for me I would never make a sale with same day because the cost to ship same day is usually as much as the price of the product or more. I have some items that the price for same day is over $100. Soon the other auction sites are going to start getting more buyers because the sellers are leaving and going to them and able to sell for a lot less than what they have to charge because of ebays fees. I’m in 3 other sites and I’ve seen a huge change in the amount of new sellers and buyers. That’s because we don’t have the huge fees, in fact some don’t even charge a final value fee and what a blessing when we get to keep the majority of our profits compared to ebay. When the buyers realize that they can go to other auction sites and purchase the items lower than at ebay, they will buy and leave ebay in the dust.

    • iamjohnconnor

      If your only making $1.32 on a $300 hundred dollar sale then buddy you are in the wrong business!

  • Ro

    “Selling on eBay doesn’t have to come at a high price tag as long as the

    seller understands where and when eBay fees are applied, and how much
    value they add to their listings.” – This is true for many categories,
    but the ones I sell in (dvds, games, etc) have the highest fees and
    usually very low profit margins once you account for the cost of goods
    sold plus all the ebay and paypal fees, shipping costs, and
    time/supplies spent restoring and listing the items. With Top Rated and
    Power Seller status, it’s a bit less, but that’s only a 20% discount on
    the *fees*. When the fee is .60 +, that’s not much of a discount.

    Consistently,
    ebay and Paypal take between 20%-25% of my total gross once storefront
    subscription is factored in. When I started selling in the early aughts,
    they were nowhere near as greedy, and honestly I don’t think they’ve
    added a whole lot of value to the service compared to all the
    restrictions they’ve imposed on sellers. I wish a more affordable,
    comparable venue existed for sellers tired of being nickel and dimed to
    death.

    I understand they’ve got costs associated with running
    the sites and databases, but with posting record profits, it’s time ebay
    gave something back to the people and businesses who do most of the
    work. Also not thrilled that many coming policy changes to protect
    sellers will not apply until WELL after the holiday rush.

  • CECIL

    MAYBE SOMEONE CAN TELL ME, HOW DO I SEND A 1.10 NICKEL ACROSS TOWN CERTIFIED MAIL (LIKE THEY ARE TRYING TO MAKE ME DO) FOR $1.64 AND MAKE A PROFIT AT IT?? YA! RAISE THE PRICE OF THE NICKEL RIGHT? THAT WILL MAKE ME VERY COMPETATIVE ON E.BAY. RIGHT!!!!!

  • http://twitter.com/Janpygmy94 Jan Miles

    I agree with you. Ebay gets the seller for the sale and shipping and then has paypal charge us again. Isn’t that called a Monopoly? This all makes me mad and I still can’t understand how Ebay can charge the seller a final value fee on shipping. We are not making a profit on the shipping, the customer pays for the shipping and the shipping service charges us to ship the item. So the seller takes the hit from every end.

  • Edward

    Do share – Which other sites? An alternative would be a Blessing!