Omega Owners Forum

Please login or register.

Login with username, password and session length
Advanced search  

News:

Welcome to OOF

Pages: [1] 2  All   Go Down

Author Topic: How are E-Bay and PayPal making their money...  (Read 1753 times)

0 Members and 1 Guest are viewing this topic.

mkaminski100

  • Senior Member
  • ****
  • Offline Offline
  • Gender: Male
  • Basingstoke
  • Posts: 595
    • View Profile
How are E-Bay and PayPal making their money...
« on: 01 February 2009, 12:46:52 »

I have just sold an item on ebay for £62. E-Bay charged me £6.86 their fees (Insertion fee, min price, sell fee etc) and when I got my payment through PayPal, I found that PayPal charged me another £2.31. So I only got £52 from £62.
This means that from any item on Ebay I have to pay min 15% for fees! That's little too much.
Previously I've been using Ebay for purchasing and selling cars so I have never checked fees (£12 for car) but now I see how much money they take.
Unfortunately, there is only a Gumtree where I can sell my "junk" without paying that much so next time I will have to wait longer for any response to my ad.
Logged

VXL V6

  • Omega Lord
  • *****
  • Offline Offline
  • Gender: Male
  • Warwickshire
  • Posts: 9875
    • 530D M Sport, Elite 3.2
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #1 on: 01 February 2009, 12:50:35 »

Don't see what the problem is to be honest, You'd have to pay to advertise virtually anywhere else and if you wanted to express clear a cheque you'd have to pay bank charges.

Most large value items (such as cars) usually have the transaction done by agreed means other than Paypal so they don't pay the fee's.

Logged

TheBoy

  • Administrator
  • *****
  • Offline Offline
  • Gender: Male
  • Brackley, Northants
  • Posts: 107073
  • I Like Lockdown
    • Whatever Starts
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #2 on: 01 February 2009, 12:51:06 »

If you want to use their commercial service, you have to pay those fees.  If you don't want to pay the fees, there are other outlets ;)

For a trader, ebay is quite cheap - remember a small stand at a show at NEC can easily be £10k for a week :o

Your other option is pitch up at a car booty on Sunday morning, pitches normall £10 - £20
Logged
Grumpy old man

mkaminski100

  • Senior Member
  • ****
  • Offline Offline
  • Gender: Male
  • Basingstoke
  • Posts: 595
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #3 on: 01 February 2009, 13:17:58 »

I'm not a trader and I don't make living from e-bay sales so 15% is a lot for me, especially that I am selling stuff from my garage.
Usually I use Monebookers to transfer money and they charge 1% (up to £0.50) so PayPal IS expensive.
Next time I will wait longer for a Gumtree ad response and ask for cash :)

Is there anything else similar to Gumtree (free ads)?
Logged

TheBoy

  • Administrator
  • *****
  • Offline Offline
  • Gender: Male
  • Brackley, Northants
  • Posts: 107073
  • I Like Lockdown
    • Whatever Starts
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #4 on: 01 February 2009, 14:05:49 »

Quote
I'm not a trader and I don't make living from e-bay sales so 15% is a lot for me, especially that I am selling stuff from my garage.
Usually I use Monebookers to transfer money and they charge 1% (up to £0.50) so PayPal IS expensive.
Next time I will wait longer for a Gumtree ad response and ask for cash :)

Is there anything else similar to Gumtree (free ads)?
Somebody, somewhere, has to pay for it.
Logged
Grumpy old man

humbucker

  • Omega Baron
  • *****
  • Offline Offline
  • Gender: Male
  • Cambridgeshire
  • Posts: 2119
  • VX Trade Card, Halfords Trade Card. Neat.
    • www.irmscherMV6.com
    • View Profile
    • www.irmscherMV6.com
Re: How are E-Bay and PayPal making their money...
« Reply #5 on: 01 February 2009, 14:17:10 »

you could always try loot.com they're free and you would also appear in the regional paper. the problem with using them and your local rag in the most part is that you usually have a limited amount of text and no images. ebay affords you as much text as you want and the option to add additional and hi quality images, so you can be sure to get as much detailed info across as possible. its just a shame a lot of sellers still choose to put minimal description in.

agreed, ebay and paypal make a great deal of money from doing not a lot, ie. no physical product means limited overheads thus high profit margins. but at the end of the day therein lies the brilliance of the business model and it is no surprise that ebay is now the worlds 4th largest growing economy. that's ahead of a great deal of the developing COUNTRIES of this world!

you have to remember that ebay allows your 'for sale' item to appear worldwide, and from the comfort of your own home ie. no pitching up a stand at the car boot in the cold and only selling to locals for a few hours on a sunday. your ad goes in for up to 10 days.

my biggest problem with ebay is that the paypal protection scheme just doesnt seem to be worth the e-paper it's written on, however, by and large i have had nothing but positive experiences on ebay.

of course, some people artificially inflate the starting bid on their item to offset the fees and expected end sale price, and there are others who, against ebay rules, inflate the postage costs to do the same thing. im not recommending either of those methods you understand, but it would appear that there are things you can do to improve your overall ebay experience

 :y
Logged
http://www.irmscherMV6.com | #irmscherMV6
Genuine Tech1 and Tech2 diagnostic services for Vauxhalls and Saabs available in and around Cambs.
PM with your requests.

TheBoy

  • Administrator
  • *****
  • Offline Offline
  • Gender: Male
  • Brackley, Northants
  • Posts: 107073
  • I Like Lockdown
    • Whatever Starts
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #6 on: 01 February 2009, 14:29:51 »

Quote
you could always try loot.com they're free and you would also appear in the regional paper. the problem with using them and your local rag in the most part is that you usually have a limited amount of text and no images. ebay affords you as much text as you want and the option to add additional and hi quality images, so you can be sure to get as much detailed info across as possible. its just a shame a lot of sellers still choose to put minimal description in.

agreed, ebay and paypal make a great deal of money from doing not a lot, ie. no physical product means limited overheads thus high profit margins. but at the end of the day therein lies the brilliance of the business model and it is no surprise that ebay is now the worlds 4th largest growing economy. that's ahead of a great deal of the developing COUNTRIES of this world!

you have to remember that ebay allows your 'for sale' item to appear worldwide, and from the comfort of your own home ie. no pitching up a stand at the car boot in the cold and only selling to locals for a few hours on a sunday. your ad goes in for up to 10 days.

my biggest problem with ebay is that the paypal protection scheme just doesnt seem to be worth the e-paper it's written on, however, by and large i have had nothing but positive experiences on ebay.

of course, some people artificially inflate the starting bid on their item to offset the fees and expected end sale price, and there are others who, against ebay rules, inflate the postage costs to do the same thing. im not recommending either of those methods you understand, but it would appear that there are things you can do to improve your overall ebay experience

 :y
depends on your definition of 'limited'.  Each server is probably in the region of £5k-£30k, and they will have thousands.  And these need power and cooling, constant disk replacements, and entire replacements every 3-5 years.  Then their is the software costs.  I don't know, but guessing the databases are probably something like Oracle, and are clustered with something similar to Veritas Cluster Services.  That ain't cheap.  And I seem to recall ebay saying they used Sun Microsystems servers, so there is the support contracts associated with not only the hardware, but also the OS (likely Solaris if based on Sun hardware).

Yes, its undeniably a great business plan, but don't underestimate the cost of running a massive site!
Logged
Grumpy old man

humbucker

  • Omega Baron
  • *****
  • Offline Offline
  • Gender: Male
  • Cambridgeshire
  • Posts: 2119
  • VX Trade Card, Halfords Trade Card. Neat.
    • www.irmscherMV6.com
    • View Profile
    • www.irmscherMV6.com
Re: How are E-Bay and PayPal making their money...
« Reply #7 on: 01 February 2009, 16:33:25 »

oh yeah granted that the running of an operation like ebay has significant overheads in terms of technology, contracts, staff, global operations etc, but some other multi national organisations would have similar expenses AND manufacturing / 'physical' costs in addition to all those. as a business, you ideally want a product that has no manufacturing costs altogether, and thats almost what ebay has achieved, hence their profit margins are through the roof. of course all this is possible because the likes of you and me want to sell any old tat on there. bread annual 1986 anyone?*

and one mans rubbish is anothers treasure as they say...  :y

*feat the non peter howitt joey boswell. open to offers  ;D
Logged
http://www.irmscherMV6.com | #irmscherMV6
Genuine Tech1 and Tech2 diagnostic services for Vauxhalls and Saabs available in and around Cambs.
PM with your requests.

philhoward

  • Senior Member
  • ****
  • Offline Offline
  • Staffs
  • Posts: 939
  • Love the engines, so put one in something else..
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #8 on: 01 February 2009, 16:49:32 »

Ebay fees do "sting" sometimes, but at the end of the day its the price for a service - but check the fees when you list (specifically the price break points...) to use them to your advantage.

If you expect a certain value for your item, then it has been known for a slightly inflated postage cost to be "reduced" if using another payment method...know what i mean?

You're paying for the ease of it all..sitting there in the warmth of your own home, without 100's of phone calls and (in the case of cars for sale) multiple tyre kickers.  Granted - their "Buyer Protection Scheme" isn't worth a sod, so I use a credit card for my ebay purchases (hence getting their protection) then pay the CC the money straight away from my bank account so they're making nothing from me either!
Logged
Running an X30XE in a Reliant Scimitar GTE as I can't have an Omega as a company car...

TheBoy

  • Administrator
  • *****
  • Offline Offline
  • Gender: Male
  • Brackley, Northants
  • Posts: 107073
  • I Like Lockdown
    • Whatever Starts
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #9 on: 01 February 2009, 17:32:52 »

Quote
oh yeah granted that the running of an operation like ebay has significant overheads in terms of technology, contracts, staff, global operations etc, but some other multi national organisations would have similar expenses AND manufacturing / 'physical' costs in addition to all those. as a business, you ideally want a product that has no manufacturing costs altogether, and thats almost what ebay has achieved, hence their profit margins are through the roof. of course all this is possible because the likes of you and me want to sell any old tat on there. bread annual 1986 anyone?*

and one mans rubbish is anothers treasure as they say...  :y

*feat the non peter howitt joey boswell. open to offers  ;D
Remember, ebay give away a lot of their fees to winning bidders - see the link below my sig for how to get up to 40% of ebay's fees when you win an auction ;)
Logged
Grumpy old man

TheBoy

  • Administrator
  • *****
  • Offline Offline
  • Gender: Male
  • Brackley, Northants
  • Posts: 107073
  • I Like Lockdown
    • Whatever Starts
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #10 on: 01 February 2009, 17:33:45 »

Quote
Quote
oh yeah granted that the running of an operation like ebay has significant overheads in terms of technology, contracts, staff, global operations etc, but some other multi national organisations would have similar expenses AND manufacturing / 'physical' costs in addition to all those. as a business, you ideally want a product that has no manufacturing costs altogether, and thats almost what ebay has achieved, hence their profit margins are through the roof. of course all this is possible because the likes of you and me want to sell any old tat on there. bread annual 1986 anyone?*

and one mans rubbish is anothers treasure as they say...  :y

*feat the non peter howitt joey boswell. open to offers  ;D
Remember, ebay give away a lot of their fees to winning bidders - see the link below my sig for how to get up to 40% of ebay's fees when you win an auction ;)
Specifically this link :y
« Last Edit: 01 February 2009, 17:34:01 by TheBoy »
Logged
Grumpy old man

Danny

  • Omega Lord
  • *****
  • Offline Offline
  • Gender: Male
  • Wigan, Greater Manchester
  • Posts: 6483
  • BLACK 1.6 BORA SHAPED JETTA!!
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #11 on: 01 February 2009, 18:48:29 »

Quote
I have just sold an item on ebay for £62. E-Bay charged me £6.86 their fees (Insertion fee, min price, sell fee etc) and when I got my payment through PayPal, I found that PayPal charged me another £2.31. So I only got £52 from £62.
This means that from any item on Ebay I have to pay min 15% for fees! That's little too much.
Previously I've been using Ebay for purchasing and selling cars so I have never checked fees (£12 for car) but now I see how much money they take.
Unfortunately, there is only a Gumtree where I can sell my "junk" without paying that much so next time I will have to wait longer for any response to my ad.

ebay's fees vary depending on what you're selling, mobile phones has a high fee percentage too
Logged

Martin_1962

  • Guest
Re: How are E-Bay and PayPal making their money...
« Reply #12 on: 01 February 2009, 19:34:02 »

I up the postage to cover it, but recently postage rate rises have eaten into that
Logged

TheBoy

  • Administrator
  • *****
  • Offline Offline
  • Gender: Male
  • Brackley, Northants
  • Posts: 107073
  • I Like Lockdown
    • Whatever Starts
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #13 on: 01 February 2009, 20:19:00 »

Quote
I up the postage to cover it, but recently postage rate rises have eaten into that
And another dramatic increase in April
Logged
Grumpy old man

TheBoy

  • Administrator
  • *****
  • Offline Offline
  • Gender: Male
  • Brackley, Northants
  • Posts: 107073
  • I Like Lockdown
    • Whatever Starts
    • View Profile
Re: How are E-Bay and PayPal making their money...
« Reply #14 on: 01 February 2009, 20:19:27 »

Quote
mobile phones has a high fee percentage too
And rightly so :)
Logged
Grumpy old man
Pages: [1] 2  All   Go Up
 

Page created in 0.011 seconds with 17 queries.