It’s not new.  The summer slowdown has happened every year about this time.  The weather is better, parents and teens are focusing on graduation, people are spending more time in their gardens, and in general, there are more things pulling people away from their computers.  What is different this year is that the economy continues to slow.

Yesterday, Warren Buffet gave an interview where he said the economy still stinks and will continue to do so for some time.  Then this morning, unemployment figures came out higher than expected. This of course affects shopping habits. In the past, Americans went into debt and spent as if their incomes would always increase.  The savings rate in the US was actually negative for the past few years. Now the savings rate is over 5% –higher than it has been in 20 years. Consumers are not only saving more they are reducing their debts. All of that translates into lower spending and eBay is not exempt from that.

So what to do?

Well first of all, don’t give up.  Yes, sales are down but there are still sales. They haven’t gone to zero.  My sales are way off from last year but still profitable.

Here is the strategy I am using to cut my costs and keep my profits up:

1. Reduce the number of listings – The first thing you notice during a slowdown is that your conversion or sell-through-rate (STR) falls.  This means that fewer listings close with a sale. When that happens your fees go up. Remember, you pay a listing fee whether something sells or not. So if fewer of your listings are selling then you need to reduce the number of listings to reduce those fees.  The trick is figuring out which ones to cut.

The simplest way to do this is to stop listing items that are not selling.  This doesn’t mean you have to stop selling them. Instead of paying expensive auction-style listing fees, you can move them to an eBay Store or Fixed Price Listing format where the listing fees are very low. Then concentrate your auction-style listings on your best selling products.

2. Raise Your Prices on Prime Merchandise – This may seem counter intuitive. When business is slow, most people cut prices and for some products you may have to do this.  But, when you raise prices in general you may get fewer sales but you make more money on each sale. I would rather have fewer more profitable sales than lots of unprofitable sales.  If there is one thing I have discovered is that there are always people who will pay for quality and good service.  If you can convince those buyers you can deliver that, then they will buy.

3. Cut Prices and Get Rid of Nonperforming Inventory – If you are like most eBay sellers, you have stuff that sells well and stuff that doesn’t.  In a period like this cash is king.  You want put raise as much cash as possible and put that cash into inventory that is selling well.  If you have nonperforming inventory (i.e. stuff that sells slowly or just doesn’t sell at all), then cut the price to the bone and get rid of it.  Yes, you may take a loss, but if it’s just sitting on a shelf in your closet and you are paying listing fees over and over, then you are already losing money.

4. Cut Your Optional Feature Fees – If you look at your eBay statement at the end of the month you will see that all those little optional feature fees (extra photos, bold, subtitle, scheduler, listing designer, etc.) can really add up fast.  Many of these features can help but you need to really look at your auctions to see if they are working. I find that they do help for some products but don’t for others.  I was able to save over $60 per month by removing them from listings that weren’t performing.

5. Use an Auction Management Service to Save Time and Cut Fees – There are about a dozen auction management companies that all provide a different level of services and fees. I have been using Vendio for a number of years, but am slowly switching over to InkFrog. Another good on is Auctiva. And if you use a Mac, give Auction Genie a try.

Here is how they save you money.  If, for example, you use InkFrog you will pay $9.95 per month for the service. But you will save the 15¢ per photo for extra photos, 10¢ per listing if you schedule your auctions (which most people do) and 10¢ if you use listing designer.  All of these features are included in the $9.95 month InkFrog fee.  So in my case, I list about 200 auctions per month –each with at least three photos.  So that saves me 30¢ per listing X 200 listings = $60 per month. I also use a template to make my listings look good. That saves another 10¢ per listing or $20 per month. And then I also save another $20 when I schedule my auction listing times instead of paying eBay.  That totals $100 month savings less the $9.95 fee, so my total savings are $90.05 per month or $1080.60 per year. On top of all that, these services save me a lot of time. They are much faster than listing items through eBay.

There is one caveat. eBay is running a temporary promotion, whereby you get your first five listings per month for free when you list using the eBay Sell Your Item Form. If you are listing an expensive product (one with a high starting price), then I would list those five items directly on eBay and use InkFrog or whatever service you use for the rest of them.

I talk about these tips and many more tips to increase your eBay sales and profits in The Complete eBay Marketing System.

See Also

• “The Insider Secrets to Selling on eBay” by the Internet Marketing Center’s Advanced eBay Mentoring Team
  Learn eBay fast and easy with the complete soup to nuts training course from The Internet Marketing Center

Here are the details:

 Regardless of your start price, your first 5 Auction-style listings will have NO Insertion Fees when you list with eBay’s Sell Your Item form or Simple listing form.

The Final Value Fee for these 5 listings with $0.00 Insertion Fees will be 8.75% of the sales price or $20, whichever is lower. Any additional items sold during the same 30-day period will have the same Insertion Fees and Final Value Fees as they do today. Learn more.

Choose the option that works best for you, based on how you list:

• eBay’s Sell Your Item form or Simple listing form – If you’re currently using one of these forms, you can either take advantage of the 5 free Insertion Fees every 30 days, or opt out by listing your items via an eBay tool or third-party listing solution.
• eBay tool or third-party listing solution – If you’re currently using one of these tools, you can either take advantage of this new pricing structure by listing your first 5 Auction-style listings every 30 days through eBay’s Sell Your Item form or Simple listing form, or continue with your current practices at the current pricing.

 The 5 listings with $0.00 Insertion Fees are especially helpful if you don’t sell a high volume, but offer the kind of unique and hard-to-find inventory buyers expect to find on eBay. I am also using it to list expensive items with a high starting price.  For example, I usually use Vendio or InkFrog to launch my listings, but once each month, I go into the eBay sell your item form and list five of my firepit barbeque grills at $227 each. Not only do I save the listing fee, the final value fee is also lower than on a regular sale.

See Also

• The Complete eBay Marketing System by Skip McGrath – Complete printed business manual – money back guarantee
  eBay Printed training manual by a Gold PowerSeller who sells on eBay every day.

eBay will effect the changes they announced in April next Monday.  If you haven’t revised your listings by then you run the risk of your listings being cancelled and/or not found in search.

The two biggest changes are that all listings must have a shipping and handling time stated and your items must be in the correct category.  Here is a link to the April 14th announcement. Be sure and read the entire announcement to see if your listings will be affected.

The other big factor is the new category and item specifics policy.  eBay has made some very important changes that will affect thousands of sellers.  Here is a link to the page with the category changes.  Get this wrong and your auctions will be cancelled.

The other big change coming in June won’t happen until June 30th. That is when the free shipping promotion will end. If you offer free shipping after that date, then you will no longer get free subtitle and if you are a PowerSeller then you will no longer receive the double fee discounts.

See Also

• The Complete eBay Marketing System – A printed instruction manual to start and run a profitable eBay business
  The best selling training course for beginning eBay sellers, or small sellers who want to expand their eBay business
• The eBay Sellers News is the oldest and largest FREE newsletter for eBay sellers
  Join over 50,000 subscribers who get our FREE eBay and eBay wholesale information twice a month.

Auctiva’s complicated and pricey fee schedule announced a couple of weeks ago had upset users and was driving business to competitors InkFrog, Vendio and others.

Jeff Schlicht, CEO and founder of Auctiva, the largest eBay auction management service, started out his message to users with an apology: “I am very sorry and humbly apologize for any frustration and anxiety we caused you to experience about the future of your business over the past week and a half. I know that these recent events have greatly upset our community and I take full responsibility for that. I am asking you to give me a chance to make it right.”

Jeff then went on to announce the new pricing strategy. Auctiva will move to flat monthly pricing of $9.95/mo .to include:

*         1GB Image Hosting

*         A Faster, Easier-To-Use, One-page Lister

*         Bigger Supersized Images

*         Better-looking Templates

*         eBay’s Most Popular Scrolling Gallery

*         Free Scheduling

*         24/7 Customer Support

*         plus all of our other time and money saving tools

In addition to their Standard flat-rate plan, they announced a special Starter flat rate plan for ultra-casual sellers: $2.95/mo., up to 15 listings, 500MB image hosting.

Auctiva also announced that their marketing tools like the scrolling gallery will remain free for now.

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See Also

• Learn to sell on Amazon. Selling on the River is the best selling book for eBay sellers wanting to learn how to sell on Amazon
  Easy, step-by-step instructions and short videos show you how to move into what is now the largest online selling site.

Mark from Connecticut, eBay ID Skyboss, has two eBay money-saving tips.

If you host your images on eBay it can get expensive. eBay gives you one photo for free, then charges 15¢ for each additional image. If you are using three images in each listing, that is 30¢ per listing. I do about 150 listings per month, so that would cost me about $45 per month –actually more, because I often use 4 images in some auctions.  Mark uses a low-cost photo program called Corel PhotoPaint that can combine several images into one image.  So you can have 3 or 4 images for free. Here is a link to Mark’s listings where you can see what it looks like: http://shop.ebay.com/merchant/skyboss_W0QQ_dmdZ1QQ_ipgZ50QQ_sopZ12?_rdc=1

Mark also saves money by reusing boxes that are in good condition. He simply takes the box apart and reassembles it inside out, so the original printing on the box is on the inside.  He uses a hot glue gun to quickly reassemble the boxes.

Jeanne S. from Vermont gets loads of free bubblepak and small boxes from a local large gift shop in her tourist town. They happily give her the shipping supplies rather than pay large local recycling fees. She tosses any boxes or materials in poor condition, but usually ends up with a full week’s supply of good boxes and materials with each trip to the store.

In news from eBay:

A few weeks ago Amazon announced that they were putting restrictions on collectible book sellers to limit the sellers who could sell collectible books to large experienced sellers. eBay is taking advantage of those lots of small unhappy sellers by announcing a listing fee discount to 5-cents per listing in the collectible books category from now (May 27) through June 9^th.  The categories that are eligible include:

• Antiques – Books & Manuscripts
• Books – Antiquarian & Collectible

Used, including collectible books are a great business opportunity for eBay sellers. Our best-selling book, How To Make Good Money Selling Used Books on eBay, Amazon and the Internet gives step-by-step instructions to this great little online business. We show you which books to buy –and more importantly, which books NOT to buy, where to find them and how and where to sell them at margins of 500% or more.

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• Try A Complete Professional Internet Marketing Course for only $2.95
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• Learn About Ten, Little Known, eBay Niche Businesses Anyone Can Do for Immediate Profits
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I have been fairly critical of eBay lately as they seem to be ignoring new and small sellers. But here is a great promotion that will benefit this group.  

Here’s how it works: Regardless of your start price, your first 5 Auction-style listings will have NO Insertion Fees when you list with eBay’s Sell Your Item form or Simple listing form.  Note:

This means that is you now use a third party service such as Auctiva, Vendio or InkFrog, you will not get the discount unless you log into eBay and use their form.

The Final Value Fee for these 5 listings with $0.00 Insertion Fees will be 8.75% of the sales price or $20, whichever is lower. Any additional items sold during the same 30-day period will have the same Insertion Fees and Final Value Fees as they do today.

The 5 listings with $0.00 Insertion Fees are especially helpful to sellers who don’t sell in high volumes, but offer the kind of unique and hard-to-find inventory buyers expect to find on eBay. This is exactly the type of seller eBay needs to attract and keep.

Be sure and use your 5 listings strategically.  Don’t waste them on items with a 99-cent starting price.  Use them on items with a higher starting price. This way you get the most bang for your buck.

Skip McGrath

See Also

• Complete eBay Marketing System teaches you how to start and run a profitable eBay business
  This printed training manual is written by an eBay Gold power seller who has been selling on eBay since 1999
• Learn How To Make Good Money Selling Used Books on eBay, Amazon and The Internet
  Complete training course on a low cost, low risk, high profit business –and it’s fun to do

This is part two of the post I started yesterday about the changes to the eBay platform and the new policies announced by eBay that will take effect in June. You can scroll down to see part one. As I did in part one, I am giving each of these my Star Rating (1-5 stars) just like eBay has buyers do for sellers. When I finish the third and final post, I will calculate the total star rating.

By the way I am now on Twitter. I am not a big twitterhead, but I always do a tweet when I do a new blog post or upload a new edition of my newsletter. So if you would like to follow me, here is my Twitter profile: http://twitter.com/Skip_McGrath 

New Smart FAQs Package tracking in My eBay Return policy and handling time-deadline extended Customized Item Specifics Category and item specific changes

Smart FAQs is a new free feature that draws on live information from your listings to answer the top 20 buyer questions before buyers reach you through the "Ask a question" or "Contact seller" links.  This is a wonderful option for sellers who only sell one category of product. But in our case we sell in four different categories and some of the FAQs would just confuse people. (3-Stars) This is potentially a great feature for sellers who ship everything themselves and a good feature for those of us who also dropship. If you print a shipping label through PayPal or eBay, tracking, a delivery confirmation numbers will automatically appear in the buyer’s My eBay. If you don’t use the PayPal or eBay label printing solution, you can enter tracking information manually in My eBay. Unfortunately you can only upload USPS and UPS tracking information.  I would give this a higher star rating, but for example one of our leading products is shipped by FedEx Ground so this system won’t work for us. (3-Stars) Earlier in 2008 eBay advised sellers they are required to add a return policy and handling time to all your listings by mid-March of 2009. eBay has extended the timeline: Return policy and handling time will be required in all new listings and when you relist beginning June 15. The deadline for updating your Good ‘Til Cancelled listings has been extended to mid-September.   Personally I think this is something eBay should have done a long time ago and I don’t know why they are extending this. Small sellers have had several months to do this and large sellers have automation tools to do it for them, so I don’t see the point. Having a stated return policy and handling time is a big positive for buyers and I don’t see any downside for sellers. I have used a formal return policy in my auctions for over 5 years. I don’t know why eBay is waiting, unless they plan to add some yet to be disclosed mandatory features which is what I suspect. (1-Star) Item Specifics let sellers provide details about the item you’re selling, such as its condition, size, color, or style. These details appear at the top of your listing description, in a consistent format, making it easy for buyers to get the facts about your item. eBay provides suggested Item Specifics in drop-down boxes during the listing process. However, if these suggestions don’t work for your item, you can create your own value for an item specific. These are customized Item Specifics.  I really like this feature and am glad eBay is expanding it to more categories. (4-stars) The big change here is in the jewelry and watches categories. This will force sellers to list fashion and fine jewelry and watches in the appropriate category and force sellers to use accurate terms. For example you can’t call something a diamond if it is not. This means you cannot use terms such as simulated diamond. If it’s a zirconium you must call it a zirconium.  This policy is going to upset a lot of jewelry sellers –especially low end and fashion jewelry, but will help buyers find what they are looking for. My take on this is strong agreement. Even though it will make life difficult for some folks, it is really good for the buyers. Some of my readers will hate me for this, but I strongly believe in not misleading people and making it easier for buyers to find exactly what they are looking for. I give this one 5-Stars.

See Also

• Ten Little Known, Highly Profitable eBay Niche Businesses Anyone Can Do
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• Using Twitter to Build Your Online Profits
  Learn everything you need to know about Twitter including The Twitter Secret –Only $5 one time fee.

eBay latest announcements  cover a lot of ground –too much for one blog post, so I am going to break them down into three posts. today is part one of three.

I am going to try and comment on the changes the best I can realizing that the info available from eBay is still limited. We will have to wait until June to see the final versions.  eBay has buyers rate us sellers on a 5-star system, so turn about is fair play. I am going to give my star rating for each of these features. At the end of the third post I will give you the calculated total.

Let’s look at the first group of changes. The eBay description is on the left and my comments are on the right. The hyperlinks will take you to the eBay page that explains the policy and gives examples. I strongly suggest that you go there and read the full policy after you read my comments.

Overall these changes are a big positive for sellers. About the only disappointment is that eBay has permanently abandoned the level playing field concept. They have been favoring the mega sellers for some time now which is interesting because these guys are the least loyal of all the sellers and are all selling on other platforms. I don’t really have a problem with eBay giving fee discounts to large volume sellers. After all, you can get discounts for almost anything you buy in volume anywhere.

But I don’t like the idea that large sellers get prominent placement and special promotions that the rest of us don’t get. If eBay is really into driving buyer satisfaction then give anyone who provides a stellar buyer experience the breaks regardless of their size or volume of listings.

Skip McGrath

See Also

• The Complete eBay Marketing System is the largest and most comprehensive eBay training manual on the market today
  Learn from an eBay Gold PowerSeller who sells on eBay every day. Printed manual with online supplements

I would love to know what eBay’s stats show, but I suspect that cross border sales between the US and Europe and Japan are down. Why? Because I got a call from eBay last week wanting to know if I knew about the 1¢ International visibility sale that eBay was running.  eBay announced the promotion a couple of weeks ago to run through March 27^th. The promotion allowed a seller to list an item on eBay US for a penny that will show up on eBay UK when their buyers search.

International visibility used to be free until eBay started charging for it.  The fees for an auction style listing run between 10¢ – 40¢ and between 25¢ and $1.00 for fixed price listings depending on the starting price. Paying this fee allows your products to show up on eBay UK when one of their buyers performs a search.

That doesn’t sound like a lot of money, but it can add up if you are running dozens or hundreds of listings. When I was actively selling internationally, my international sales (mostly to the UK and Canada) were about 10% of my sales and they were slightly more profitable. But when you factor in the additional listing fees some of those profits disappeared.  The other problem –in fact the major problem was the Detailed Seller Ratings (DSRs).

Whenever I sold internationally, my overall DSR score went down. I was talking to another big seller this morning who had the same experience. In his case although he has a very high overall DSR 4.8 to 4.9, when he sells internationally he gets one and two stars.  Getting low DSRs has two negative effects:

You lose search position and you can lower or lose your PowerSeller fee discounts.  So this tends to negate any advantage of selling overseas.

To be honest I have spoken to other sellers who are not seeing this. They continue to do well internationally, but they seem to be fewer and fewer.  And if eBay is not only running promotions and they are reaching out to sellers by phone to make sure they know about it –that tells me there is a problem.

The solution to increasing international sales is simple: Reduce the international visibility fee to 10¢ across the board and do away with DSRs for cross border sales.

There is one thing sellers can do on their own. In my newsletter last week, I reported on a company called Shipwire. Shipwire is a warehouse dropshipping service.  You store your products with them and they ship for you.  If you want to sell overseas they have a warehouse in the UK and Toronto.  So you would ship your products in bulk, clear and pay customs and Shipwire will store the products for you. When you make a sale, you simply enter the order and customer’s address on a web form and Shipwire ships it to your customer for you.

Now you have a choice. You can pay for international site visibility or you can just open an account on eBay UK and list directly there.

Of course they can also do this in the US.

See Also

• The Official Geezer Guide to Starting and Running an Online Business by Skip McGrath
  Learn how to start 6 different low-risk, low cost online businesses from home
• Learn How To Make Money Selling Used Books on eBay, Amazon and the Internet
  Books are low risk, low cost and easy to source for high profits. Anyone can start this very easy business

Here’s a snippet from an email I received today from a long time reader and eBay PowerSeller:

“….my ebay store for the first time since starting in 2005 may end the month without ONE sale.  I have over 140 items listed in my store with an additional 160+ as FP.  My traffic on Inkfrog shows that since this past December, my FP listings are getting almost 12X more traffic than a store item.”

I am seeing the same thing. My eBay Store sales have virtually dried up, yet my Fixed Price listings are doing very-very well. In fact I am now making more from my fixed price listings than from my auctions.

So you might ask –why have an eBay store?  I used to have a good answer to that question but I don’t really have one anymore. About the only advantage I can think of is that I have a link to send people to from off of eBay and I can earn referral sales credits. But that is a fairly small percentage of my eBay sales. I am beginning to wonder if I need to spend the $49.95 per month for a premium store.  I will probably drop back to the basic store at the end of this month.

See Also

• 2009 Edition of Insider Secrets To The Internet Mega Course – Sale ends Soon !!!
  Time is running out to get your $90 discount on the oldest, largest and best training course on the internet that carries my personal endoresment