eBay goes after Amazon with fee changes for sellers

Source: ET
SAN FRANCISCO: eBay Inc said on Tuesday it will overhaul fees for sellers on its online marketplace, stepping up competition with Amazon.com Inc .



EBay is scrapping its complex, tiered set of "final value fees," calculated as a per centage of an item's sale price, and introducing flat-rate fees based on product categories.

Many of eBay's listing fees, a bone of contention among sellers, are also going away. Most of the changes kick in April 16, with others taking effect May 1.

Many sellers will pay lower fees after the changes, especially those who are not volume sellers and list less than 12,250 times per month, according to Scot Wingo, chief executive of ChannelAdvisor, which helps merchants sell on online marketplaces including eBay and Amazon.

"These fee changes definitely make eBay more competitive," said Wingo.

EBay's move comes as sellers on Amazon's marketplace become increasingly upset with fee increases.

The company's announcement about the new fees included a table comparing its charges to Amazon's fees, a move that Wingo said he had not seen before.

"EBay is really coming out swinging against Amazon," Wingo added.

For consumers who sell only a few items a year, eBay will offer 50 free listings per month. If the item sells, the company will take 10 per cent of the sale price.

EBay has been using a fee structure that included a listing fee of 50 cents per item for full-price listings. The company has been offering free listings only on auctioned items.

For larger-volume sellers, eBay will introduce new final value fees ranging from 4 per cent to 9 per cent, depending on the product category. Fees have varied, depending on the sale price of the items.

"For most of our sellers the complexity of our fees were keeping them from being on eBay and preventing them from having full transparency into their profitability from selling on eBay," said Michael Jones, vice president of merchant development.

"There will be some sellers who will pay a little bit more on eBay, but most sellers will be impacted positively by this," he added.

EBay shares rose 1.5 per cent to $50.85 on the Nasdaq. Amazon was off nearly 1 per cent to $255.75.

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