First off I want to thank everyone who gave us feedback and who is helping this site become even better. We are always open to hearing about new and better ways to do things.

Invitation

How many of you had the opportunity to help eBay define their fee structure when they were first starting? I would like to give each of you an opportunity to voice your opinion and help shape a service that is only in its infancy. In fact, it was a year ago on Halloween that I left Microsoft to pursue this full-time. The company was still operating out of my garage, and we had no employees. Now we have a warehouse and 10 employees. We are all still on the ground floor. Where do you see us being in the next 2-5 years?

Please help us define our direction and shape the service into what you want and need it to be.

Goals

These are our high level goals for our new fee structure.

Cost-effective
Sellers need to be able to make as much profit as possible so that they will send us even more cards. We would love to be averaging 5,000 new cards per day by the end of the year.

Sustainable
The fees need to cover our expenses as we grow to having millions of cards. We need to balance the cost-effective goal with paying our bills, hiring more employees, and expanding our warehouse.

Understandable
People need to be able to see or hear our fees and easily remember them. We want this to grow by word of mouth.

Reaching Our Goals

In order to go after the first goal, we decided to drop the upfront processing fee to 10¢/card. We do have a state of the art system for scanning and inventorying every single card, but it is not quite that good. This is effectively a loss leader. We are subsidizing the cost of processing the cards with the belief that we will earn back the difference when we help your cards sell.

Now to balance the first goal, we need to protect our initial investment in processing your cards. If your cards sell quickly, that is great! You are happy, and we earn back our loss. If your cards just sit there forever, we lost money up front, and we continue to lose money each month as we have to pay for insurance, warehouse rent, website hosting, Beckett data licensing, and many other expenses.

Our first stab at addressing this issue and keeping our fees easily understandable was to introduce a 1¢/month storage fee. This would encourage people to set fair asking prices so that the cards will sell more quickly. If they don’t, we will eventually recoup our losses and cover our expenses through the storage fee. Millions and millions of cards are listed on eBay each month for least 3¢/month, so we felt that 1¢/month should be more than fair.

Helping You Sell Cards
Our ultimate goal is to actually help you sell your cards, not to just sit on them forever. I hope that the new fee structure of 10¢ upfront and 1¢/month will bring in significantly less revenue per card than the original 20¢ fee because cards will be selling that fast.

A large number of our seller are already seeing this kind of success, and in order to help even more sellers be successful, we are building many new inventory management features. We would even love to increase our advertising budget.

Your Feedback
We have already received many helpful suggestions, and I want to encourage more of you to pipe in. What do you think of the updated fees?
* Is 10¢ upfront + 1¢/month fair?
* Should we give more than one month free storage when initially listing cards?
* Should people get a month or more of free storage when they attempt to flip cards?
* Should buyers get a few months of free storage when they are waiting to make their shipment request?
* Should we give people the option of paying a larger upfront fee instead of the storage fee?
* Should have a tiered storage fee that decreases for people that have a large number of cards?
* Should we give you a discount on future processing fees based on what you are paying for storage?
* Does someone want to just donate a ton of money so that we don’t have to charge fees anymore?

We are open to all feedback, but remember, we need to keep the fees understandable and sustainable.

Feel free to leave comments on this blog post or send feedback directly to us.