How Much Are eBay Fees?

How Much Are eBay Fees?

As one of the most popular ecommerce marketplaces in the world, selling on eBay is a great way to start a business. But, before you start an eBay business, it’s good to know what fees you’ll incur in doing so—that way you’re positioning yourself in the best possible way to maximize your profits. 

From listing products to payment processing, eBay will charge you a host of different fees—the exact price of which will vary depending on many factors. That said, to help you make smart business decisions, we’ve compiled this comprehensive guide, breaking down everything you need to know about eBay fees.

Types of eBay Selling Fees

If you want to sell on eBay, you have to pay several selling fees to access their ecommerce marketplace, which will depend on what you’re selling and how you’re selling it. 

The two main fees you’ll pay are insertion and final value fees; however, there are several other types of fees you’ll encounter as well. Let’s explore the details.

1. Subscription Fees

An eBay store allows you to run a complete business on eBay. You get access to discounted fees, tools, and the ability to post more free listings. To start an online store on eBay, however, you have to pay a monthly subscription fee. 

The amount you pay depends on the type of package you purchase from the following list: Starter, Basic, Premium, Anchor, or Enterprise. Each package comes with specific pricing for listings, but the Anchor and Enterprise packages come with additional benefits such as a $25 quarterly credit toward promoted listings.

eBay Store Subscription Pricing

Subscription Type Monthly Fee Free Fixed-Price Listings Auction-Style Listings Fixed Price Listings
Starter
$7.95
250 per month
$0.30
$0.30
Basic 
$27.95
350 per month
$0.25
$0.25
Premium
$74.95
1,000 per month
$0.15
$0.10
Anchor 
$349.95
10,000 per month
$0.10
$0.05
Enterprise
$2,999.95 (only available as an annual plan)
100,000 per month
$0.10
$0.05

Although you’re not required to open an eBay store to start selling on eBay (you could simply set up a business account instead), there are many benefits to paying the monthly subscription fee and opting for this route.

For example, each of these plans includes a set number of free fixed-price listings per month. In addition, as we mentioned above, each plan includes discounts to business services, free listings for guitars and basses, and other advantages.

2. Insertion Fees

If you’re asking, “How much are eBay listing fees,” you’re talking about insertion fees. An insertion fee is the fee that’s charged every time you list an item on eBay. 

This fee applies to listings that are either auction-style or fixed-priced (also known as “Good ‘Til Cancelled”). Auction-style listings are when you list an item at a starting price and interested buyers place bids. After the auction ends, the item is sold to the buyer with the highest bid. 

Fixed-priced listings are listings sold at a set price. A buyer can immediately purchase the item at the set price without bidding.

Each month, eBay waives a certain amount of insertion fees for sellers, depending on their eBay account. For example, sellers with a basic eBay account can list up to 200 items in specific categories with zero insertion fees. 

Those with eBay stores receive 250 or more zero insertion fees (as shown in the table above). Once you’ve used up your zero insertion fees, you are charged $0.30 for each listing, or less if you have an eBay store.

3. Final Value Fees 

When a sale has been made, eBay charges a final value fee. This fee varies depending on the category of the item. A final value fee is a percentage of the total price of the sale plus shipping and handling. 

The shipping and handling cost is calculated based on the shipping service the buyer selects. Final value fees range from 2% to 12% for basic account holders, whereas store sellers are charged anywhere from 1.5% to 12% on items. Generally, the average final value fee is 9.15% for most items and is capped at $750.

For example, if you sold an item for $100 with free shipping and handling, your final value fee (usually 9.15%) would be $9.15.

That said, final value fees are charged regardless if a buyer pays you or not, so if you do not receive payment, make sure you immediately cancel the purchase or report the sale to receive credit from eBay.

4. Payment Processing Fees

Like many ecommerce platforms, eBay charges payment processing fees using PayPal. But recently, eBay has moved toward a consolidated payment system for buyers and sellers known as managed payments.

Currently, access to the managed payments is by invitation-only, which means that most sellers on eBay still use PayPal for online credit card processing. The managed payments system allows buyers to choose from more payment services such as Apple Pay, Google Pay, credit, and debit cards—and sellers receive money directly from eBay.   

Here is some additional information about the two payment systems: 

  • Managed payments: Managed payments charge one total value fee, a percentage of the sales transaction plus $0.30 per order. For store sellers, the final value fee is 11.5% for most items. For non-store sellers, the final value fee is 12.35%.
  • PayPal: PayPal is still the dominant payment processor on eBay. For each sales transaction, PayPal charges 2.9% + $0.30 per order. 

There is some controversy over eBay’s shift to managed payments. The advantage of PayPal is that it offers more control over your money when accepting payments online. For example, if a customer returns an item using PayPal’s payment processing system, you’ll still have access to the funds until the return is processed. 

This is not the case with managed payments, where it takes a few business days to process returns. However, managed payments does have benefits. Many sellers find that it is much more organized and breaks down invoices for sellers. And in some cases, managed payment fees are much lower than before.

Managed Payments vs. PayPal: Cost Comparison

To demonstrate the cost difference between managed payments and PayPal, we’ll use a hypothetical scenario. Let’s say a customer spends $120 on an item with free shipping and zero sales tax. 

Under the old payment system, you would pay a final value fee of $10.98 plus PayPal’s processing fee of 2.9% + $0.30 per order (this equals $3.78). Using this calculation, then, it would cost you $14.76 to sell the item. 

With managed payments, you will be charged a total value fee of 11.5% + $0.30 per order. The full calculation for this item, then, will cost you $14.10. 

In this case, it is slightly cheaper to use managed payments.

5. Penalty Fees

eBay will charge you an additional 5% in standard final value fees the following calendar month if you fail to meet minimum seller performance standards or if you exceed eBay’s threshold for the amount of returned orders that say the item was not as described. 

If you’re an above standard or top-rated seller, you don’t have to worry about these fees, and you can track your performance on the seller’s dashboard. You will also receive penalty fees for not following eBay’s terms and conditions, as well as their seller guidelines.

6. Optional eBay Fees

There are also many optional eBay fees you can pay to increase your listings’ visibility and style—or even to help you conduct business outside of the platform. Here are three extra costs you’ll incur for using additional services: 

  • Classified listing fees: To list an item as a classified ad, you can pay a flat rate of $9.95, which will last for 30 days. A classified ad allows sellers to list an item through the eBay platform, set a price, and negotiate the deal with the buyer outside eBay.  
  • Promoted listing fees: Promoted listings boost the visibility of your item on eBay. Promoted listing fees are based on the ad rate or the percentage of an item’s final sale price after purchase. A promoted listing’s fee is charged based on the ad rate selected by the seller. The ad rate does not include shipping and taxes. 
  • Listing upgrade fees: If you want to make your listing stand out using special features such as a bolded font, images, or subtitles, listing upgrade fees apply. These fees start at $0.10.

It’s important to note that the pricing for promoted listing fees and listing upgrade fees depends on the type of listing you choose.

eBay Fee Calculation Example

Now that we’ve covered the requisite fees on eBay, we’ll go over an example of how much it costs to sell items on the platform.

Imagine that you’re selling a laptop in used condition using a 10-day duration. You do not own an eBay store. You select a starting price of $700, with a Buy It Now price of $600, and you offer free shipping. You spend $0.35 to list this item.

You’ve used up your zero fee allocations, and you are in good standing with eBay.

The item sells immediately for the Buy It Now price of $600. There is a sales tax of 7%. Since you aren’t charging the buyer for shipping or any other costs, $642 is the total amount of the sale, including the sales tax.

Your final value fee is $79.69 or 12.35% of $642 plus $0.30, using the managed payments fee system. 

Your total fees for selling this item is $79.99, or $76.69 plus the $0.35 insertion fee.

From this transaction, you make $520.01.

How Can I Reduce My Seller Fees? 

As you can see based on our example, eBay seller fees can add up. If you aren’t careful, it can drastically affect your return on investment. Although you can’t avoid these fees, there are a couple of ways you can reduce them. 

Open an eBay Store

Opening an eBay store can drastically reduce your final value fees, especially for sellers who sell items in the electronics category. You do not necessarily need to purchase the highest package. Just having a basic eBay store can reduce your total value fees from 10% to 4%. 

Become a Top-Rated Seller and Leverage Top-Rated Plus

Top-rated sellers are the best of the best on eBay. As a top-rated seller, you’ll be eligible to leverage top-rated plus benefits, which will help you receive a 10% discount on your standard final value fee. 

To become a top-rated seller, you must follow eBay seller best practices and meet the following requirements: 

  • Be active on eBay for 90 days
  • Have at least 100 transactions
  • Generate at least $1,000 with U.S. buyers over the past 12 months
  • Defect rate is less or equal to 0.5%
  • Late shipment rate less than or equal to 3%
  • Five or few late shipments

Once you hit top-rated status, you will be able to qualify for top-rated plus, which will give you that 10% discount on your standard final value fee. But—in order to receive top-rated plus status, you will have to offer one-business-day shipping and handling, as well as free returns. 

The Bottom Line

At the end of the day, calculating how much eBay’s selling fees are can be complicated—especially when you’re just getting started. But just because eBay’s fee structure can be confusing, doesn’t mean that it’s impossible to make a decent profit off the platform. 

There are several strategies you can implement to reduce your seller fees, one of which is taking advantage of opening your own eBay store. Overall, once you get a hang of it, these fees become more straightforward—and, as the platform moves to managed payments, more online sellers will (hopefully) have a better experience with the new fee structure.

 

Zoe Weisner

Zoe Weisner is a contributing writer at JustBusiness. Previously, Zoe worked at BlueVine, a fintech startup that provides working capital to small businesses. At BlueVine, Zoe worked with small business owners to understand their financial needs and wrote content about small business-related topics, including marketing, business operations, and small business financing. Today, Zoe writes articles about personal finance, small business, and banking.

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