Interesting response to new eBay "reserve" fees

joejeweler

Hi....i thought it rather interesting when i read the response of an eBay coin dealer to the new reserve fees charged on items that haven't even sold! Is eBay getting a bit greedy.....sure seems like it! But this sellers game plan might be the answer......i know i may draft a similiar disclaimer for some auctions in the future.

Without something like this in place, and without the use of a low starting bid with a fair reserve protecting the seller.........i've noticed there doesn't seem to be the same volumn of bidders as before. Some, i realize, would just bid early and low never expecting to be a winner on an item.....just to save room in their limited "watch" list. I do it myself! But often i seriously consider an item toward the end of an auction BECAUSE the item is in front of me.....on my bid list. With only 30 possible "watch" items available.......it's easy to run out of room when screening coins for sale of interest to me. Bidding low and early on a coin expanded my possibilities and allowed for a greater pool of coins to decide among.

Now a seller has to either open an auction very near what he needs to get to survive....pay ebay the "usery" fee......or do what this seller has decided to do!

What do ya'll think?
Joe T

quote from one of eBay user "yellowriver" auctions:

"IMPORTANT:

Recent eBay changes in reserve pricing policies have made it impossible to continue to sell expensive coins as before, for two reasons. 1). It is not fair to me to be penalized for putting a reserve on my coins, to protect my cost and investment. 2). It is not fair to you to have to pay for the overhead of coins that do not sell. We sell about 1 in 4 coins. Ebay now wants a hefty reserve fee for all coins that do not sell. So, until further notice, I will put a $9.99 reserve fee on all coins, but will be forced to end all auctions early if it looks like we cannot break even on this auction. Therefore, I ask that you put your best foot forward right away, and put up a legitimate bid for this coin if you like it, and lets do business. I am here to sell coins, and the last thing I want to do is pull the rug out from under you, but can't continue to stay in business if I have to include the reserve price fees of three coins that do not sell into the price of the one coin that does sell. I wish I had that much of a profit margin on my coins! Also, last minute bidding will not work, but if any coin meets my target price early, I will reward you and end the auction early.

Sincerely, Dick

PS: Send me a message if you have any ideas or suggestions on this matter."

relayer

See how well that strategy worked for The Reeded Edge

BigD5

It's Ebay's park, and they make the rules. That means they can change the rules. As a seller, if you don't like it, go home and play by yourself.
I think this makes the larger auction houses a more viabable venue for some higher priced items, as opposed to Ebay. The more Ebay raises the fees for the style of listing that most higher priced items are listed at, the more of a potential for losing those more expensive listings.
If you are listing a $5,000 coin, one of the major auction houses is usually a better forum to sell that at, as opposed to Ebay. There will be many more "serious" buyers for that type of material, at say a Heritage, or Bowers sale than surfing through Ebay. Of course, if it's a generic type of coin that commands a lot of money (A St.Gaudens?), Ebay will work for something like that.
When I'm selling, I usually want to limit the Ebay Stuff to under $1,000, give or take. Anything over that amount is a tougher sell on Ebay. That's what I've found.
A seller like Legend or Pinnacle, where most of their material is of the more expensive variety (and usually worth all the pennies ), may have better results seling the higher priced items on Ebay, as they will usually have a "following" of buyers that are comfortable spending that level of money. If nothing else, those businesses should keep AT LEAST 10 listings a week, regardless of the price of the coin, just for advertising! Beats the phone book rates, in most cases, with as much, or more exposure.

Barry

If these sellers are so upset with reserve fees, why don't they just start the auction at a price they're willing to accept? Am I missing something here?

RotatedRainbows

If these sellers are so upset with reserve fees, why don't they just start the auction at a price they're willing to accept? Am I missing something here?

I think the biggest problem with your response is it makes sense!!! And as we know many ebay sellers have little common sense at least when it comes to their business practices.

BillJones

Dealers who use Ebay regularly tell me that if you can offer a piece with a low opening bid that you will get some bids. According to these dealers starting bids beget more bids, which can lead to better prices. If the price is set at a fair opening level, I've been told that you run a good chance of getting no bids at all, or the final price might not be as high because there will be less competition.

AbesNeighbor

Why not just put the first bid up as the minnimum you are willing to accept?

kranky

Now that ebay assesses a fee for using a reserve price (I think it's 1% of the reserve), sellers need to decide if it's worth it. Playing games with cancelling auctions isn't going to be the answer. As baseball said, ebay will start charging for that too if it become the mechanism for evading reserve fees.

It's fine with me if people want to have a reserve. Ebay has decided they will charge for the privilege. So the sellers can either change their approach, or pony up the fees. But as was pointed out, the answer is as simple as setting the opening bid to the lowest acceptable sale price. I'm sympathetic to the fact that a low opening bid can attract more bidders, ultimately resulting in a higher sale price. Fine! That strategy is available, but it costs you to have a reserve.

C'mon sellers, you don't have a legitimate complaint. Set the opening bid to the lowest price you'll accept.

JTMC

i think another reason ebay charges a reserve fee is to stop dealers from putting outrageous reserves on coins they know no one will ever meet but it brings alot of traffic to their other auctions or web store.they just keep relisting every week for long periods of time. its was a very cheap way to get alot of exposure to their products. i guess now its not so cheap.

joejeweler

BINGO.....Bill, you hit it right on and was MY main point! One of the other posters thought this was "my" policy for listing eBay auctions, and i wanted to state for a fact it is not! I can, however, see a certain logic in the philosophy!

"baseball" mentioned reserve fees are charged by the major auction houses........BUT EVEN IF THE COINS DON'T SELL? I've never delt with a major coin auction house but i doubt it!

Ebay wants 1% of any reserve price (up to a $100.00 max.) for any item which fails to sell. Every time the seller relists this item and it fails to sell.....new 1% fee! A few listings on an expensive coin and the entire profit margin can be wiped out when final value fees are figured. Guess who pays in the end.....WE DO!

This is in addition to the regular listing fees and remember.....they get a final value fee were the item to sell! Restricting the ability of a seller to use a reserve (which is what ebay's new policy is doing, in reality) hinders the sale of a higher ticket item. Without a larger base of bidders actually bidding on a particular auction.....the final price can't help to be lower and often elicit NO bids in the 1st place. Keep in mind the opening bid (if no reserve is used) has to be reasonable, of course!

The seller i quoted from regarding his new policy is simply trying to avoid havind to pass along NEW costs of 3 items that don't sell into the 1 that does......and i suspect more dealers will be using a similiar system.

BTW....i believe eBay messed up in buying PayPal, and down the road that liability will cost them! This new reserve fee policy i suspect will also prove to be a mistake.
Joe T




<< <i>Dealers who use Ebay regularly tell me that if you can offer a piece with a low opening bid that you will get some bids. According to these dealers starting bids beget more bids, which can lead to better prices. If the price is set at a fair opening level, I've been told that you run a good chance of getting no bids at all, or the final price might not be as high because there will be less competition. >>

CarlWohlforth

I switched to high opening bids for certain coins.

It seems clear the auctions are not as exciting. There is less interest. If there are many bidders they might stretch to win the coin.

Personally I think this is costing eBay money. I suspect less deals are closing so there is less Final Value Fee money for them this way.


edited to add: I won't cancel auctions unless I've made a bad listing error. This just gets bidders mad. I know because I'm a bidder too.

kranky

<< <i>Without a larger base of bidders actually bidding on a particular auction.....the final price can't help to be lower and often elicit NO bids in the 1st place. >>



I understand why it's desirable to have a large number of bids on an auction, which can be encouraged by having a low opening bid. But really, so what? It's a sales tactic, nothing more, just like when a department store marks an item at $100, sells none, then advertises 30% off and still makes a profit.

A reserve is no different from setting an opening bid at the same price. One costs 1%, the other is free. Sellers believe the "low opening with reserve" generates more money. If so, they have the option to pay the fee in return for higher prices.

JOHNandBEA

I agree with Billjones.......This is an auction, part of the appeal is the bidding, lets not ever forget that, the "chance" to "steal" something is in most of us.........one thing is for sure, an opening price of $ 1.00 will draw a crowd, and often some will still be standing there in the end..just my opiniom


John

topstuf

Who needs "Reserve not yet met?"

I start my auctions at the minimum I will take. They usually go up from there, but I will sell at the open if I get a bid. Secret is to have coin priced right and know it.

On antique toys, most sellers have stopped ebay as high end toys do NOT sell there.

Baley

good points by all. I think the change in reserve auction price structure is actually a better deal if the reserve price is $200 or less, so it's just more expensive for the more expensive items. Also, the reserve auction fee used to be refunded by ebay if the item sells and the final value fee is collected. Does anyone know if that is still the case? I think you only pay the reserve price fee if the item DOESN'T sell. If it does sell, you don't pay that fee, just the listing and final value fees.

If they keep now keep the reserve auction fee along with the final value fee, then that would be a problem.

If not, then I think the change in policy is a good move by ebay because it will encourage more honest dealing, since the seller will have to choose between either listing at a minimum acceptable starting price, or setting a reasonable reserve price. Too many auctions end with out an ebay sale because the reserve was set unreasonably high in the first place, and that frustrates bidders. Also, probably too many "off-ebay" deals were haggled due to the "cheap" advertising.

I'd say the sellers should just deal with it and choose, and don't choose to be like reedededge

so many times on reeded edge auctions, I would bid my absolute max and not meet the reserve, and then get an email from them, offering the item to me for $1000 more than my high bid!

kranky

I forgot to address the original question which was what I thought of yellowriver's comments.

Recent eBay changes in reserve pricing policies have made it impossible to continue to sell expensive coins as before, for two reasons. 1). It is not fair to me to be penalized for putting a reserve on my coins, to protect my cost and investment.

If it's not fair, don't use a reserve, but set your opening bid appropriately. You are fully protected.

2). It is not fair to you to have to pay for the overhead of coins that do not sell.

I guess we're paying the overhead now anyway for all the reserve price auctions that didn't sell, so your statement is a bit disingenuous. But since you meant it's not fair for us to pay for the extra reserve fees, see answer to 1. above. You won't have to pay the extra fee.

We sell about 1 in 4 coins. Ebay now wants a hefty reserve fee for all coins that do not sell. So, until further notice, I will put a $9.99 reserve fee on all coins, but will be forced to end all auctions early if it looks like we cannot break even on this auction. Therefore, I ask that you put your best foot forward right away, and put up a legitimate bid for this coin if you like it, and lets do business. I am here to sell coins, and the last thing I want to do is pull the rug out from under you, but can't continue to stay in business if I have to include the reserve price fees of three coins that do not sell into the price of the one coin that does sell. I wish I had that much of a profit margin on my coins! Also, last minute bidding will not work, but if any coin meets my target price early, I will reward you and end the auction early.

Your strategy is quite flawed.

1. You intend to alienate bidders by cancelling auctions because you were too cheap to set a reserve, and too greedy to set an opening bid appropriately, since you prefer the sales tactic of "low opening bid plus reserve" to generate a large number of bids.

2. If you are "here to sell coins", nothing could sell coins faster than setting the opening bid at the lowest price you would accept. If the price is right, you'll sell your coins. If you aren't selling them, consider the possibilities that you are asking too much, or that ebay might not be the proper venue for your coins.

3. You intend to alienate snipers, too, since you say "last minute bidding will not work".

4. You have a mystery "target price" in mind, but we are supposed to be mind-readers to know what it might be. You could just...set the opening bid appropriately!

So you will penalize early bidders, and pull the auctions before the snipers can take a shot. Who are you trying to sell to?

joejeweler

Let's hope "high end" coins don't go the way of high end toys on ebay! Sure is convenient for a busy guy like me to search what's available......

Truth be told.....these new fees on ANY high end item (on anything earning ebay a cool $100 EVERY time an item doesn't sell!).....are going to put a damper on what's presented on ebay by sellers who want to stay in business!

Try selling something a few times yourself with a $100 hit each time it doesn't sell.....and see if your view doesn't change a bit!

Joe T




<< <i>Who needs "Reserve not yet met?"

I start my auctions at the minimum I will take. They usually go up from there, but I will sell at the open if I get a bid. Secret is to have coin priced right and know it.

On antique toys, most sellers have stopped ebay as high end toys do NOT sell there. >>

joejeweler

Baseball........truth be told is i only own one coin with a cost of around $1,100, ....and a couple around 2k-2.5k

Every other coin has cost betweek 5k to 17k......and i sure don't want to have the prices go up further on future purchases because these coins were listed a dozen times before they sold! I haven't sold any yet, true. But if and when i do i could see myself being VERY pis*ed having to pay these "extra" fees! Ebay has had a great run and has made a ton of dough to the owners.......NO NEED to rape and pillage their loyal sellers!

BTW,.....listing a $10,000 coin isn't the only way a frequent seller gets hit. How about 200 coins listed at an average of $100 each, and half don't sell.........means the same fee in the scheme of things and $100 lost is a day's pay to me!

If a seller is listing "crap" coins.......then i guess the extra fees don't amount to much! (but then the coins don't either....)
Joe T



<< <i><<Truth be told.....these new fees on ANY high end item (on anything earning ebay a cool $100 EVERY time an iten doesn't sell!).....are going to put a damper on what's presented on ebay by sellers who want to stay in business!

Try selling something a few times yourself with a $100 hit each time it doesn't sell.....and see if your view doesn't change a bit! >>


You certainly have a flair for overdramatizing a situation. Not every item that sellers put on ebay is valued in excess of $10,000. Are YOU implying that every coin you list is over $10,000? We get the fact that your upset about the fees, but STOP exaggerating!!! >>

joejeweler

Baseball......pretty much what i do now anyway.....and last week was the 1st time i've listed more than an occasional item! (i had previously only sold 3 or 4 items before that on ebay.......all other 200+ transactions were "buys")

I know the 1.5ct antique diamond bangle from 1914 was worth a lot more than the $600 it brought! (opening bid). How do i know it was worth more than $600.....well, i've been a jewelry 32 years and I would have paid $800 to $1,000 for it!

here's the link for that auction is you want to see a "rip"!

Diamond Bangle


Anyway, i honored the opening bid and followed thru. The buyer LOVED IT, and agreed it was of museum quality and will just put it away......what i should have done in the first place. But i tried the higher opening bid/no reserve format and it doesn't work. My other high ticket items sold awhile back for fair prices, and used low start price reserve auctions. (a $3,800 Taylor acoustic guitar, a $4,200 Rolex and a $2,200 Rolex were sold this way)

......but without a low opening with a reserve not much bidding interest and i believe it cost me in my recent auctions.




<< <i>Joe,

Based on your last post, I think the previous suggestions of listing at your "reserve" price would be the best route for you. I believe it's only a few bucks and you could list it for almost a year (including the nominal 10 day fee), for the same price as a $10K+ with a reserve not selling.

It would be nice if ebay would stop raising fees but that's just not the reality of it. I'm sure they have a team of analysts that do nothing but analyze ways to increase fees and confuse sellers on their fee structure.

In any event, best of luck in your future auctions. >>