eBay’s Christmas Gift to Sellers: A 14% Increase in Fees

  • Comments: 0
  • Written on: January 6th, 2007

eBay has announced some not-so-good news to the power sellers among you out there. For the seventh straight year, eBay will be raising some of the fees it charges sellers to post items for sale on the popular auction website.

While this year’s increase is moderate, it may further exasperate those who make a living on eBay by shrinking their profit margins. The auction giant is increasing the price for listing an item by $.05 and is also increasing the percentage it takes of all sales under $1,000.

While the move is not good news to anyone who buys or sells on eBay, there is some controversy about what the price increase means to eBay’s business model.

Some people believe the eBay has grown as large as it can get, and therefore can not open new markets for services. That means the only way the company can continue to grow revenue is to raise the prices it charges its customers (eBay sellers).

In addition, eBay’s costs of doing business are slowly climbing as online advertising rates recover to pre dot-com bubble levels.

Others argue that the fact that the increase is so small and that eBay enjoys a relative dominance in its industry will shield the company from very many sellers leaving the online service for other providers.

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