Hot Topics:

Managing eBay Shipping Fees

A veteran eBay seller gives tips for discovering your secret formula.

Q: I’d like some suggestions on how to handle shipping charges now that eBay charges fees on shipping. I sell all kinds of things and shipping can vary by location. I charge as high as I think it will be, and refund the buyer if I’ve overcharged. PayPal refunds the fees on shipping, but eBay doesn’t.

A: You are definitely not alone when it comes to trying to figure out best practices for managing eBay shipping fees. Ever since eBay started charging a final value fee on shipping charges more than a year ago, sellers have been scratching their heads trying to figure out the secret formula for managing shipping fees.

One thing is certain: Whether you charge buyers for the actual shipping, or “roll” the shipping cost into the item price, you will be paying a final value fee on it. All sellers know there is no such thing as “free shipping.”

I, too, sell a wide variety of items. Some are lightweight and can easily ship in a small padded mailer or box for $2 to $3 within the U.S., and the cost is the same regardless of where the buyer lives. But other large, heavyweight items can be tricky since the cost can vary so much depending on where it’s being shipped to. You don’t want to scare off potential buyers by charging what they might perceive as “high” shipping, but you also don’t want to end up losing an arm and a leg on the sale by offering free shipping.

If you ‘charge as high as I think it will be,’ you could be turning a lot of buyers off right from the start, and that’s never a good thing

The secret formula

So, what should you do?

That’s a question I’ve been trying to answer myself, and unfortunately there is no one right answer. Managing eBay shipping fees depends on many factors, some of which will take a little research:

  • What are other sellers charging for similar items?
  • Did completed listings of similar items sell and, if so, what were their shipping costs?
  • What did you pay for the item originally? Can you afford to discount the shipping cost or will it cut into your profit margin too much?
  • Can you include the shipping cost in the item cost to offer “free” shipping (attractive for buyers) and still make a profit if the item sells?
  • Have you had buyers complain about overpaying for shipping and having to wait for a refund?

Pleasing buyers

It’s all about perception these days. In your listings, if you “charge as high as I think it will be,” you could be turning a lot of buyers off right from the start, and that’s never a good thing. Buyers everywhere have been trained to seek out free shipping—it is one of the greatest factors a buyer considers when deciding whether to buy online. (For more about that, check out this article from InternetRetailer.com). The more reasonable eBay shipping fees appear to be, the more likely you are you make a sale.

In your case, I would try using eBay’s “calculated shipping” option so that, at the very least, buyers will see a more accurate shipping cost and know they won’t be overpaying for shipping up front.

If you don’t already own a digital scale, I highly recommend you invest in a one. It will let you give buyers extremely accurate quotes for shipping costs, and help you manage your shipping fees on eBay. Since eBay doesn’t refund the final value fees it charges you on your shipping charges, you can avoid having to refund on shipping entirely if you aren’t overcharging buyers from the beginning.

About the author

Rebecca Miller
Having been an eBay seller for more than 13 years, Rebecca Miller is tuned in to the needs of online sellers. As the product manager for Auctiva.com, the largest third-party provider of eBay tools, Rebecca works closely with eBay's product development team, and is an internal advocate for Auctiva's customers. Opinions expressed here may not be shared by The Online Seller and/or its principals.

  • consolidatedtools

    In the UK we still do not pay FVF on shipping!

  • rl1856

    For smaller or lighter items, I offer free shipping and build the cost of shipping into the price I charge. For larger or heavier items, I tell buyers that I will send a separate invoice for the cost of shipping. The invoice is created and sent through PayPal, thus avoiding Ebay and associated Ebay shipping cost fees.

    • Wouldn’t that be considered fee circumvention under ebay policy?

  • manchester

    It would simplify things if ebay would disclose what they are charging on shipping to the buyer. It is absurd to be rated on shipping charges without disclosing to the uninformed buyer what ebay is secretively charging.

  • Crystalroad100

    Ebay wants more and more out of the Seller’s end so now they even charge selling fees on shipping costs. Then they tell us to keep shipping costs to a minimum in order to sell more!? Why not drop the seller’s fees on shipping so we can offer lower shipping costs. We can’t afford to take anymore out of our end.

  • Here’s a constructive comment for eBay to ponder: Hey, eBay, as much as you guys love to experiment with innovation, how about getting your collective technological energy focused on how to provide automatic reimbursement of fees to eBay sellers who proactively and conscientiously refund their buyers for excess shipping fees? You have automated just about everything else, so what’s the challenge on automating something that will make your sellers happier…uh, scratch that…less disgruntled? Thank you for at least listening for 15 seconds, eBay, before tossing this into that infinite pit of yours.

    Hawaiian Odysseus

  • Longtimeebayer

    Thanks for the ideas.

  • FC&T

    I understand why ebay has placed the FVF on shipping. I’ve seen many expensive electronics sold, mostly from China, with low selling prices and $200 shipping. This was a clear violation of ebays rules, but they seemed unable to shut them down, this has done that. I don’t really like the new policy but I’ve gone to offering a free shipping option on nearly everything and just rolling the cost in. It works mostly. I don’t understand Manchester’s comment below, ebay doesn’t add a charge, that would be the seller. If there were one thing that could get me to post more on ebay, that would be elimination of the listing fee.



Newsletter Signup

Subscribe!