Tuesday, December 29, 2009

Three Lessons to Learn When eBay Sellers Look Back on 2009

Blog post provided by Infopia

The economic slump of 2008-09 has taught internet retailers valuable lessons to take into 2010.
When resources became slim, business owners learned how to make much more out of much less.

This all reminds me of a story: A wise high school teacher once told her class about her days of a poor new college graduate starting out her new life on her own. She beamed as she told her students stories of painting cinder blocks to use as side tables, pleating sheets for drapes in her new apartment and creating over 20 recipes to make with ramen noodles. She told her students that the creativity and ingenuity she gained with the experience was invaluable. A student raised his hand to ask, “Would you want to go back and live that way again?” She replied, “No way! But, I’d never want to take that past experience back.”

Many internet retailers may one day feel the same way about 2009 and the economic slow down that preceded. Here are a few lessons to take with you into 2010.

1. Low Shipping Fees are Imperative to Staying Competitive
The recent economy has changed the way that online shoppers buy. Even as the economy recovers, online shopping will still trend this way. Online retailers have become leaders in the battle against traditional brick and mortar stores. One of the factors that contributes to the success is the ability for shoppers to compare rates. Shipping cost has become a large factor in this comparison. Many online retailers have implemented lower cost shipping methods to stay competitive.

2. Cost Control
What business expenses can be cut? What costs can be negotiated? Retail rent space, packaging materials, contractor fees, etc. can all be negotiated. Many internet retailers had to negotiate costs out of necessity. If you don’t ask, you don’t know if you are getting the best cost. Now that retailers have been forced to make these types of requests, they are able to be sure that they are getting the best price in the future.

3. Customer service is priceless
We have all heard the age old saying, ” the customer is key.” Many internet retailers have learned how to retain their customers with email marketing and loyalty programs. Converting new customers has been more difficult in the recession. Competition has driven many retailers to use excellent prices and promotions for hot items. Benefit descriptions and promotional banners also helped internet retailers in 2009 to beat their competitors.

Founded in 1999, Infopia provides (Software as a Service) eCommerce solutions—helping eBay sellers grow their business efficiently and effectively.


Anonymous said...

There is No such thing as Low Shipping Fees. Shipping Fees with use of the United States Govt. Post Offices qualify every parcel in many ways: 1) weight, 2) Size-dimensions, 3) location and/or zipcode, 3) Seller handling fees--YES! we ALL have them and we all intend to obtain our fees for that service we DO provide just as E-bay also GETS ALL THEIR FEES from the Sellers. Boxes, bubble wrap, tissue, peanuts, a lot of tape, markers, all cost Sellers money--how could you believe that we walk into a store and just "take" these things off the racks and walk out?? Why the police would be called and an arrest would be made. Buyers Also know that these items are NOT FREE and have to be paid to SEND OUT THEIR ITEMS for Safe Arrival since E-bay DOES NOT WANT BUYERS NOR SELLERS TO BUY INSURANCE FOR COMPLETE SAFE SHIPMENTS and this is advertised with E-bay. There is Travel to mail the parcels--Gas DOES COST MONEY and BUYERS KNOW their car and other's cars do NOT Run on Air! Some of us live an 80 min. round trip to the nearest post office and this is part of the handling all rolled into one cost. There is NO SELLER --any good business man who is going to take huge losses by offering Free Shipping--we ALL KNOW what the COSTS are to ship parcels and now, AGAIN, the rates are going up up up...as you have already listed and told us on your own business website. No one pays my Ship Costs...I am NOT going to Pay any Buyer's Ship costs when the Buyer knows that shipping with the Govt. Post Office, UPS, Fedex, and etc is NOT FREE TO ANYONE!

Evelyn said...

What a joke, as if Ebay knew anything about "customer service"As if sellers have any real ability to negotiate fees. I offer Free Shipping on many items, and I still offer a further discount for combined shipping of multiple items purchased paid for and shipped at the same time. Ebay doesn't allow me to include the additional discount to the buyer in the invoice generated on Ebay since if would lower their fees ever so slightly. So the buyers have to pay full price through Paypal and then I can issue a partial refund. But don't think that issuing that refund doesn't raise alarms at Ebay where suddenly the item will no longer appear to have been paid for.

Art said...

Nicely Written & Insightful! Thank-You! Vanessa & Art (Vanart products)

Art said...

Nicely Written & Insightful! Thank-You! Vanessa & Art (Vanart products)

Anonymous said...

Are you kidding? Do you live in a fantasy world?

Whoever wrote this article is not a real eBay seller. If you are that smart in controlling cost, please teach eBay sellers as

1. how to negotiate shipping charge with USPS and UPS,
2. how to negotiate the big fee eBay forced on sellers,
3. how to ask eBay to change the "mandated rule" of using PayPal as the only way for buyers to make payment
4. how to do a fair business when eBay disallows sellers to leave negative feedback for a bad customer,
5. how to pay for shipping insurance when sellers are not allowed to charge buyers.

Please post answers to all of these questions.

Arthur said...

E-Bay just encouraged sellers to negotiate to reduce all our expenses. Will E-Bay be willing to negotiate with me regarding the fees they charge to list my items?

eBay Certified Provider Program said...


Here are some ideas on possible solutions to your questions.

1. You can negogiate fees with most shipping carriers. The amount of the fee discount will most likely correlate with how much volume you ship through their services (UPS and FedEx). You can save on fees with USPS when paying for postage online through USPS's Click-N-Ship or with ShipRush's Endicia application - http://www.zfirm.com/products/shiprush_usps_endicia.shtml

2. Contact your eBay Account Manager or eBay Customer Representative to discuss opportunities to save money when listing and selling on eBay. eBay General Support #800-701-EBAY (800-701-3229) or use the "Contact Us" link when logged into your eBay account.

3. Sellers on eBay are not mandated to use PayPal. There are other payment options available. You can check out all available payment options here - http://pages.ebay.com/help/pay/accepted-payment-methods.html#options

4. PayPal offers Seller Protection and eBay has a Resolution Center to help resolve disputes between buyers and sellers.http://pages.ebay.com/help/buy/resolving-problems.html

5. Sellers can still buy shipping insurance and add the cost to the item or include in the total shipping price. There are opportunities to save money when purchasing shipping insurance with ShipSaver Insurance by inkFrog - http://applications.ebay.com/selling?ViewEAppDetails&appType=1&appId=insurance.inkfrog.com or other similar applications that provide discounts.

Anonymous said...

Let's not be silly... you ask HOW can sellers reduce shipping fees? Well, the bottom line is MANY DID, including myself.

I for one, have reduced shipping costs by not offering Priority 2-3 Day Shipping via USPS which was a norm for me. I have started to use FedEx instead which is cheaper but will take longer. Guess what? Many customers don't mind if it takes 3 more days to receive the package versus the higher cost.

Now, I wouldn't be opposed to a suggestion that others that were able to reduce shipping costs, may have been overcharging in the first place. I might even agree that shipping costs can't easily be changed but the HANDLING part.....YES MA'AM. This may have reduced the profits of some sellers, where as other were just overcharging in the first place and the market has finally righted itself, much like the housing market.

Bottom line, some can reduce the charges, some can't, but it's not an outrageous suggestion to try. Maybe instead of shipping items 5 days per week, you can ship only three, therefore saving gas? Maybe you can start using heavy duty large envelopes (like myself) on items instead of boxes? Not only does this cut your cost of buying boxes, but it reduces shipping weights! If you generally fill your car with boxes, this change will also help you save gas because the load is lighter...think outside the "box" people!!

Any other suggestions?

Denise said...

I suggest taking advantage of the flat rate boxes from USPS when possible. For those that have to travel long distances to ship their packages - all of the carriers, including the US Post Office will pick your packages up at your house. Plus, you can order the free boxes online from USPS and have them ship directly to your house. Gas doesn't have to be a factor if you can use the flat rate boxes. As far as packing material expense. Use the plastic bags (from the grocery store, etc.) we all have around and put a note inside the package that you are going green by reusing the bags you've had hanging around. I've even blown up the good bags and tied them off to take up space in the box. If you have left over balloons you can do the same thing. Air weighs a lot less than tissue paper, etc. Ha!Ha! Let's face it, all of us have been taken for a ride with high price shipping at least once. There is no need to gouge anyone. On the other hand if your cost of shipping is your ACTUAL cost of shipping, plus materials and gas then so be it. Ebay is talking to those who do gouge us.

eBay Certified Provider Program said...

Love all the great ideas on how to save money on shipping and packaging!

Art said...

Great Denise! Good Information for sure! Simple Is Best & You Indeed Provided Some Simple & Effective Alternatives! Enjoyed Your Input. Thanks! Vanessa & Art (Vanart Products)

Anonymous said...

My biggest rising expense is the overcharging by eBay/paypal.
I am truly getting charged so many fees that when added up eBay/paypal is making more than I am on many of my sales. When averaged out with the items that do not sell that I still pay eBay for eBay is making more.
The sweetheart deals that eBay is making with big corporate sellers giving them better rates selling the same items I do proves that eBay is adding water to their own quick sand pushing out the sellers that built the foundation of the company.
I would be listing 10 times more items on eBay than I do now if the fees were reasonable and fair like they were when I first started selling on eBay.
My best cost cutting profit improving measure is the alternative ways to sell on line that are becoming ever more popular as the corporate greed in eBay short sightedly raises their prices.
In business a fast nickel beats a slow dime every time. In other words 10 nickles is 50 cents one dime is 10 cents. Wake up eBay management.

Mike said...

It is truly unfortunate to see the education level of some business owners. We are in tough times, and in tough times business owners must be innovative to stay competitive. It is true that there will never be a way for any of us to ship items for free. That, however, does not stop us from calling around to find cheaper packing materials; or asking the post office how to get cheaper shipping; or, as someone else said, using different shipping methods to eliminate driving and save on gas. There are several ways to save on shipping if you are willing to put some thought and time into trying. One might also consider offering free shipping in these economic times. I am just going to make up an example here. Lets say you profit 15 dollars from the sell of an item. It is going to cost you 5 dollars to ship that item. If you offer free shipping you are still profiting 10 dollars. Now lets assume that you are selling hundreds or thousands of these items. If your competitor is not offering free shipping and you are, who do you think people are going to buy from? It is true you will be profiting 33 percent less than if you charged for shipping, but you will be selling far more products than you did before because you will now have all of the business that your competitor once had. No one is telling anyone here to lose money selling on ebay. If whatever item you are selling does not have enough profit to cover the cost of shipping, obviously you can't offer free shipping. All they are trying to say is be a smart business owner; cut costs where you can; and take every opportunity to increase sales.

Roy D. said...

I have been on the receiving end of 'rip off' and 'gouge' shipping and handling charges. I should have been more careful, but the bottom line is that I would NEVER do business again with a seller that exploits the buyer this way. If you are going to make S&H a big profit center...GOOD LUCK!

Art said...

You are Correct Roy! A Seller should not depend on S&H Fees to bolster their profits on an Item.
The way we look at S&H is what it is. The Shipping Mode we use most frequently is Calculated and this allows the Shipping Charges to be Very Close to the True Amount needed for the transport of the Item. The Handling Fee is a Basic Fee which defrays the expense of the Materials Needed to prepare the Item for a Safe Journey. Nothing More!
One thing we do that really helps arrive at a fair 'ballpark' Shipping Weight is to weigh the Item & the Packing Materials & the Box that it will Travel in. Believe it or not this really gets a Very Close True Shipping Weight to use in your Listings.
Sellers get better & better at this as they go.
A lot of our Experience on 'ebay' has come from Trial & Error, but that also adds a rather scientific
aspect to Shipping!
Art From Vanart Products

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