Costing Your Articles on eBay

For a newbie eBay seller or a wannabe, pricing will be the biggest challenge as long as she or he doesn’t make a few hard sales. Both, pricing too low or too high are detrimental to business as they can soon get you out of business. So what price is the right price and how will I get the pricing right? I agree costing is not all it takes to pricing but forms the foundation although the ‘Buy Now’ price or the Reserve Price depends entirely on your judgment of the market mood and fluctuating demand for the specific item at the given time.

Costing the Price On eBay

Costing the price simply means adding up various expenses that you actually incurred till you listed the item up for auction plus those that you expect to come up later. These are simply referred to as cost components and some of these are tangible and some are not. The following is the basic structure of cost estimation for newbie sellers on eBay.

1. Your landing cost (Includes purchase cost+ taxes+ packaging+ shipping)

2. Holding cost (Includes Rental cost for warehouse/storehouse+ salaries lighting etc)

3. Listing cost; Add up eBay costs like

a. insertion fee

b. final value fee

c. Buy Now fee (optional)

d. Listing upgrade fee (optional)

e. Sellers tool fee (optional)

4. Special fees

a. Ad format fee

b. Motors fee

c. Real estate fee

d. PayPal fee

e. All special fees are applicable only when the services are availed. Here the final value fee is replaced by transaction service fee which payable is due at first bid when there is no reserve price set, otherwise payable when the reserve price is met. All the above fees differ only slightly which is available here.

5. Marketing cost: Include your AdSense expenses+ promotional expenses like fliers, news paper ads, telephonic promotions, travel necessitated by marketing etc.

6. Shipping, packing, and handling cost: Calculate this before hand using calculator available at eBay or by availing a rate chart from USPS or UPS.

7. Salary: Spread the total salary cost proportionately on all items.

8. Interest payable: Divide the entire interest outgo proportionately on each item.

9. Insurance: Keep this outside of costing at your discretion.

Note that above all fees are fixed and the only flexible ones are your profit margins which you alternate based on judgment, season, your urgency, salability and the amount you are looking to make out of the sale.