Thursday, March 8, 2012

A Change in our Business

Once or twice a year eBay implements "Seller Updates" & I've noticed over the years that these changes directly or indirectly cost us money.  Frequently we (and just about every other eBay seller in existence) slowly but surely - some not so slowly - raise prices to cover the increased cost.  We've generally gone with the flow, eBay makes these changes to encourage certain behaviors in the sellers, in the belief this will increase buyer's confidence, which will in return increase the number of buyers who shop on the site.  Some sellers react with anger (just read the boards), but I have a feeling most, like me, just make adjustments.  I'm pretty sure eBay is the still the largest site of it's kind by far, and that translates into traffic & dollars for people like me.

In this latest seller update eBay announced a change that we will finally not be able to meet.  It's not something that would drive us out of business, in fact I suspect in the long run it would only make a minimal difference, and as usual we could probably raise prices just a bit to compensate.  But it spurred us to thinking about things, and to make a change which we hope in the long run will translate into an expansion of sort.

eBay, of course, rates it's sellers, and if sellers meet certain criteria, they are awarded with "Top Rated Seller" (TRS) status.  TRS status comes with a tangible financial incentive in the form of a 20% discount on their Final Value Fees, the amount eBay charges a seller when they sell an item.   It can add up.  TRS status also brings an advantage in eBay's default Best Match search results, but that is somewhat intangible since there is no way to measure if that leads to any sales or not.  And last but not least a seller with TRS status gets a badge displayed on their listings & next to their listings in search results, which is supposed to give a buyer a bit more confidence.  Again, intangible.  But the 20% discount is not intangible, that is easly measured every month.

They've added a requirement to achieve TRS status - in June, to obtain TSR status, sellers will be required to have delivery confirmation (or some other kind of tracking information) on 90% of the items they ship domestically, in addition to all the other requirements they have to meet.   We can't meet that 90% requirement the way we currently do buisness.  We've had TRS status for years and unless we do something radical, we're going to lose it because of this.

We ship almost all items domestically for free.  Our more expensive items and/or items which are rigid - most of our antique photos, for example - are shipped as a package.  Typically the photos are shipped with delivery confirmation, the postcards not necessarily.  It's economics.

In order to ship everything with delivery confirmation we'd have to raise prices on our postcards or start charging for shipping (same difference) to cover the increased cost.  This would not be a cost we could absorb, and competition is such that I don't think we could raise the prices on our postcards high enough to cover the increased cost of shipping. 

No matter, we don't want to raise our prices & we'd like to maintain our TRS so we decided on a different approach, and it's risky, as far as I'm concerned.  It is not worth doing solely to maintain TRS status.

We've had an Etsy shop for years, but had not used it in awhile.  We've decided to start moving postcards some photos & other items over to Etsy, and concentrate our antique photos on eBay.  If we ever got to the point that we were routinely selling the same amount of photos as we are postcards, we could potentially more than double our income.  So that's what we're going to try to do.  In theory, this will also enable us to keep our TRS status, but it may not.  It's a slow process, it'll be a long time before all our postcards etc are moved to the Etsy shop.   It is not worth doing this just to maintain TRS status.  But over time, we'll have a lot more antique photos in our eBay store, and a ton of postcards and other items in our Etsy shop.  Over time this should result in a notable increase the amount of $$ we pull in, and secondarily, should retain our TRS status on eBay.  At least that is the goal.

It's a risk.  Postcards are a major part of our monthly sales, usually more than half, and if they don't sell on Etsy, we will lose money. I don't know if any any eBay customers will follow us to Etsy.  We could potentially lose a lot more money than we would by simply not having TRS status.  So it is a risk, but that's what makes life interesting, at least in the corner of the little room I'm sitting in. 

It's not like we're risking the house or anything like that.  It's only money, after all.

I put a link to our Etsy shop on the left column of this blog - click on it take a look if you want.  Check back often, we'll be adding stuff pretty much daily. Feel free to buy something, anything, I'm not particular. 

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