ebay Rules Part 2 – Insertion Fees

First of all, what exactly is an “Insertion Fee” and why do we need to concern ourselves about them.  Taken directly from ebay rules and policies:

“Insertion fee: When you list an item, you’re charged an insertion fee that’s based on your item’s starting or reserve price. Insertion fees are free for your first 50 or 100 listings per calendar month, depending on the listing format and category chosen. Exclusions apply for some categories.”

So what this means is that ebay will charge you a “insertion fee” for the ability to list an item on the ebay site.  This fee is directly related to the starting price of the item you are selling.  In the “old days” you would be charged a fee for the first inserted item.  If your item did not sell, then ebay would not charge a fee for a additional listing of the same item.  Basically you got one free ride on the fee if your item did not sell.

However, if you needed to list your item a third time, another insertion fee was charged.  As you can see, this could become quite expensive, just to list your item for sale.  Over the past few years ebay has adjusted their policy on insertion fees.  Today, listings are “free” for the first 50 or 100 listings per month (depending on the category chosen, more on this later).  So during a 30 day month, each ebay seller can get up to 100 insertion fee credits for listing their items.

So here is how it works, lets analyze listing one item on ebay.  You list a item on the 1st of the month, and pay a $0.00 insertion fee.  You have used 1 of your insertion fee credits so you still have 99 credits left for this calendar month.  If your item doesn’t sell, it comes down in 7 days and ends up in your unsold pile of items.  When you relist your item, you again pay a $0.00 insertion fee, have used 2 of your credits and have 98 credits left for the month.  If your item still does not sell, it will come down 7 days later, end up in your unsold pile.  Relisting it again uses another credit, 3 credits used, 97 left.  A fourth cycle on no sale brings you to the 28th day of the month, 4 credits used with 96 remaining.

The simple concept is this, to keep one item up on ebay, continually until it sells, and pay $0.00 insertion fees requires using 4 of ebay free monthly credits!  This will limit the amount of items you can list on ebay to around 25 listings and pay no insertion fee.  The following table illustrates this.

ebay listing 1

What this means is that, at the beginning level we can keep 25 items listed on ebay, for the entire month and pay no insertion fees.  This is the beginning step to the ebay game, keeping items listed and not spending any of your money until the item sells.

Coming up next – “Part 3 – Winning at the Insertion Fee Game”