I have fielded some incredibly disturbing calls lately from companies wanting to do business on eBay, and I want to talk about that for a bit
There is an old Chinese saying: “May you live in interesting times”
I could really write an entire blog post just about that saying. To me, it means this: “Hey pal, I hope your life isn’t boring. I hope that interesting things happen to you, around you, and because of you. I didn’t say ‘good things’ or ‘bad things’ – I said ‘things’
Of course, I always hear the voice of Mr. Miyagi in my head when I think of that saying, but that’s beside the point.
As a 12 year e-commerce veteran, I can honestly say that I am living in interesting times. I’ve been completely immersed in e-comm both as the owner of a large online seller, as an e-commerce consultant, as an e-comm writer, and as an executive for e-comm companies. I have watched small companies become big companies, big companies spectacularly fail, and other companies completely pivot when they see an opportunity. I’ve seen technology change so dramatically that it has completely leveled playing fields and totally changed the rules of the e-commerce game.
At one time, many moons ago, I was a large eBay seller. By large, I mean we were selling 5,000 items a day on the site and were the 25th largest seller in the world. At the same time, we were in the Top 15 of all Amazon media sellers. Neither relationship ended well but when I write my book about those two experiences, I will absolutely say they were interesting times. Regardless of what my personal experiences have been on both sites, I remain very respectful of what both companies have accomplished and the potential for both in the future. I actually feel like a battered spouse – both companies have treated me in the worst way possible, yet I have a very soft spot in my heart for them because they have been such an integral part of my business life.
Now, I am an e-commerce consultant and a writer. I’m in a very unique position to leverage my extensive background, especially with third party e-commerce sites like eBay and Amazon, to guide other e-comm companies and help them succeed. It’s a great gig for me because I have walked the walk and can really help others avoid the minefields.
I have fielded some incredibly disturbing calls lately from companies wanting to do business on eBay, and I want to talk about that for a bit because I’m just concerned by what I’m hearing.
The conclusion I’m beginning to draw from these case studies is that eBay really doesn’t want to do business with new sellers unless they are large enough to be recruited by eBay’s Business Development teams. Let me give you a few examples:
Last fall, Company A decided that it wanted to be an eBay seller. They formed a company, leased a warehouse space, negotiated with suppliers to bring in some inventory, and hired a few people to get things rolling. They opened up a new eBay account and a new Paypal account, and got busy listing items. On the first day of operations, they were stopped from listing any more items on eBay. They had listed 10 items. On their eBay account was a message to call in to discuss their selling goals, so they did. The eBay representative told them that because they were a new company and because it was Q4, their company had to prove itself a competent seller. So they were limited to selling 10 items for the month.
You read that right. Again, this was a company that had formed an LLC, leased space, hired people, and bought inventory with the purpose of selling on eBay. In addition, PayPal, which eBay owns, told them that it was going to hold up to 100% of the company’s funds for up to 21 days, and may force them to maintain a 25% or more balance long term if they wish to sell on eBay.
Company B tried to start an eBay business about 5 months ago. Their initial limit was 10 items a month, but after maintaining 100% positive feedback, after 3 months eBay lifted their limit to 100 items a month. On the 5th month of business, after the company still had 100% positive feedback and had now qualified for the Top Rated Seller program (which is supposed to be eBay’s best sellers), the owner called in to ask for another increase. The eBay representative’s first question to her was to ask her where specifically she bought all of her merchandise from (that’s right – The Forbidden Question). Then the rep told her that they were raising her limits to 200 items a month. When she asked the eBay rep why the amount was still so low, the rep told her that eBay didn’t want her to “grow too fast and not be able to keep up”.
What has happened with both of these companies? Well, unfortunately, Company A was forced to shut down before it even got started. Luckily for Company B, she opened an Amazon account at the same time she opened her eBay account. When the eBay rep told her that eBay was afraid that she wouldn’t be able to keep up with the growth and limited her to 200 items a month, she was selling approximately 200 items a DAY on Amazon and growing rapidly.
These are just two of dozens of examples I could provide and I could go on and on about it, but let’s just go with a few comments:
1. What company could possibly survive and grow with that level of constraint on them?
2. What is the point of the eBay Top Rated Seller Program? Isn’t it supposed to be for the best of the best eBay sellers? How could you qualify for that program and then be severely limited and not wonder what the value of such a program is to a seller?
If you are a large company and want to be an eBay seller, that is a completely different story. eBay will grant you substantially lower fees, raise you up in search results, not punish you for your feedback, and even open specific brand pages for you.
The irony of all of this is that, many moons ago, me and the other Top 100 eBay sellers were in constant dialogue with eBay execs about unlevelling the playing field. We demanded better rates, higher search results, more leniency on feedback, and the ability to brand ourselves. At that time, all of our requests were denied.
I wanted to discuss these new developments with the other Top 100 eBay sellers, but I can’t find any of them on eBay anymore. Seriously. About 90% of them are gone now.
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