| We've all heard the stories of people making a | | | | with a starting price of less than $1, eBay charges an |
| surprisingly good living from opening up a business on | | | | insertion fee of $0.20. For its closing fee, eBay takes |
| eBay. Some people have even become millionaires | | | | 5.25%. Now let's assume you are using PayPal as |
| thanks to the ease of use and global reach of eBay. | | | | your transactions service (this is the preferred |
| You may say to yourselves, "It seems easy enough. | | | | method of payment for buyers and sellers on eBay). |
| If others can make a nice profit on eBay, why can't | | | | PayPal will take a fee of 2.9% in addition to a flat fee |
| I?" The truth is, eBay is not as profitable as you may | | | | of $0.30. After all the fees you are left with $4.12. |
| think. The escalating costs of fees and marketing are | | | | eBay and PayPal take a total of nearly 18% of your |
| forcing more and more people to shut down their | | | | profit. |
| eBay business. | | | | All those fees don't even take the marketing costs |
| In August of this year, eBay announced to its | | | | into account. If you want to add a gallery picture, it |
| members yet another increase in fees. For | | | | will cost an extra $0.35. If you wanted to make your |
| businesses who make their profit selling more | | | | advertisement's text in bold, tack on an extra $1.00. |
| expensive items, the fees don't hurt as much. It's the | | | | All these little fees add up and take a big chunk out |
| "little guys", who make up the majority of eBay | | | | of your profit. |
| businesses, which are suffering the most. That is to | | | | Before spending time and money on starting a |
| say sellers that offer goods sold for less than $10. | | | | business on eBay, be sure to inform yourself on the |
| The current fee structure for cheaply priced items is | | | | potential fees you will be paying. The key to success |
| quite astounding. For this example, we will assume | | | | is finding a niche that you can make enough to |
| that the item being sold will be $5 or less. For items | | | | overcome these fees. |