Ebay sellers turning into pit bulls?

I couldn't agree with you more! I'm so sick of these people whining and complaining about "bad" ebay I quit even reading their negative poison.

I've been in business for myself since 1990. I deal with increased expenses almost daily...insurance, Workman's Comp, fuel, leases, supplies, advertising, etc. I'm not talking about a few cwnts here and there. I spend several thousand dollars a month before the doors even open to try to make a buck. I deal with supplier's daily and try to keep my employee's reasonably happy and then try to provide an excellent product to the public so they won't be tempted to try out my competition.

These folks who ebay "put out of business" with their recent fee hikes wouldn't last two days in a "real" business. If their profit margins were that low they didn't have any business in "business" to start with.

If these crybabies would spend half as much time revising their business plan (huh? What's that?) as they spend thinking their going to "take down" ebay and making their new invisible web sites maybe they could see what needs to be changed to stay successful (assuming they ever were).

The thing they apparently don't realize while they're throwing their little hissy fits and stomping their feet is that NOBODY cares...not ebay, not the market, not the public, not the successful sellers...NOBODY!

I, for one, will be glad when they all run out of their hot air and go away!

Great post Sheldon and I do accept your point.

The endless eBay debacle is tiresome. I'm sure we are all getting fed up of sellers complaints but they just keep coming. When you think of Fords recent problems, I didn't see too many Ford automobile owners on here complaining. Seems Ford, while upsetting the stockholders, at least kept the paying customers happy.

Having spent most of my working life as a Director of financial firms I can sympathise with eBay as, I too, have had to make calls that were 'not popular' with various people. I had the wrath of investors to deal with at times and, at other times, I had the venom of upset customers to deal with.

I was lucky, however, as I managed (I stress managed) to only upset one bunch of people I had to deal with at a time. I never had shareholders nursing badly damaged wallets at the same time as I had a mass revolt from the guys that pay the staff wages and dividends to the owners.

I did this by constantly listening, adapting and explaining decisions in a way that was relevant to the audience. Over the years I lost many a vacation to my duty to manage problems.

With these endless reports of customer protests, strikes and petitions in the US, Canada, Australia and Europe it seems logical management would at least address the issues being raised doesn't it?

While a shareholder may not care a dime what the customer thinks of certain issues, they will always rely on management to manage the paying customers with care.

The eBay problem, as I see it, is much deeper than most people seem to realise. The upset sellers issue is simply just one symptom of the actual illness.

Let me explain this opinion with examples:

OK, so eBay can invest a few billion in Skype only to watch ISPs the world over start to choke the bandwidth the product needs to work effectively. Oh, and then they can realise (or not) that their mainstay customers don't actually have much of a use for the technology anyway and probably wont do before the technology gets overtaken. Would that go well with angry US auction sellers as an explanation of their fee increases? Doubt it. Need another one.

OK, because eBay aren't a monopoly in China, they can invest millions in running a free site there and turn a blind eye while the 'magic' of the eBay experience is degraded for those in the US and elsewhere that actually pay to use it. Good explanation for upping fees to US customers? Doubt it.

OK, just because the lesser auction sites have realised something as simple as banning the sale of one cent eBooks dramatically cuts the level of scams buyers fall victim to doesn't mean eBay have to follow suit (but they can ban school text books instead). After all a million extra worthless listings is good PR for so called analysts to dribble over. But a good reason to up the fees for your Mom and Pop table top business community that created a successful eBay? Doubt it.

OK, then promote eBay stores extremely hard and successfully. Even turn up the incentives for new stores to open just weeks before you are announcing massive hike in fees and publicly blaming these very stores for eBays underperformance? Good explanation? Doubt it.

OK, management under pressure can collectively choose to stick their heads in the sand (Managing Director in Canada excluded) while they have a problem that's visible to the whole world. That will soothe your customers tempers wont it? Doubt it.

No, Sheldon you are quite right. Sellers will have to adapt to whatever comes and the real underlying problem isn't the latest fee hikes. After all it's buyers that eventually will have to pick up the tab as increased costs get passed on.

I'm afraid the eBay problem is much much worse than that. In my opinion it is hopeless, exposed and out of touch management. I feel they thought life was all too easy up until the markets woke up last year and effectively said to eBay "OK Meg & Co, now start working for a living and show us how good you are".

Personally I'm not exposed to eBay stock but, for the sake of those who are, I hope the CEO is replaced soon (and not by anyone called Ford!).

Except for Steve Bough, that is the end of my comment.

For you Steve, as your comment seems as much to do with pumping up your own ego as it is to dismiss the regular Moms and Pops that eBay profits from, I will tell you my background to see if that degrades or enhances your opinion about my comment.

Like you, I started in business myself during 1990. It was long hours, seemingly endless problems to solve and an often stressful but very rewarding experience which I wouldn't change for the world. Eventually I retired comfortably in early 2002 aged 42. When will you be putting your feet up?

I for one sell on eBay. Thankfully I do make money there, amongst other places. I also know why people whine so much, because their margins suck! Some of them are even losing money because they can't keep the books and work the numbers. But its just sooooo easy to sell, regardless of profit, so they all hop on board. To be clear, I hate eBay, but as auctions go, they ARE the only game in town. So for that, yes, the stock will remain relatively steady for now. I mean come on, they have no product, they print money over there. They are an affiliate marketer for the largest retailer market in the world. Soon something new will come and Skype just wont cut it in my portfolio.

Graham...

A very insightful post about the numerous flaws in ebay's management decisions and directions they have taken. I bow to your expertise in this area.

My comment was about the much narrower area of seller's going ballistic about the recent store fee increase. I certainly didn't intend to dismiss the Mom & Pop's...there are still thousands there that are apparently doing well.

I'm just really tired of the people who won't take responsibility for having a bad plan to start with, then blame ebay for their failure. Instead of adapting to whatever circumstance arises, they choose to try to stop the inevitable. That doesn't work.

The biggest problem for these folks is that their numbers are so small. From the statistics I've seen the number of ebay stores that have closed is way below 5%. The other problem for them is, as soon as they close their store, another guy is opening a new one.

Why waste all that negative energy complaining about something that YOU can change by modifying your plan?

Obviously I don't make a living on ebay...but I think I could if I wanted to. It's my hobby and I enjoy it. When it stops being fun I'll move on. But, if I do, I'm not going to be all over the web blaming Meg and Bill for my departure.

As for when I'll be kicking my feet up...ummm, probably never. Athough some days are way more fun than others, everyday is a new adventure. I absolutely love what I do...why would I ever NOT want to do it?

I have been selling on Ebay for four years. My issue with ebay lately is, other than running a monopoly, their fee hikes are not justified. I have also owned businesses in the past and I acknowledge that there are costs involved. However, lately the cost of listing items for sale usually is more than any profit you may eventually earn. Ebay just doesn't deliver anymore, in spite of its size. You might have to list a $25 items 20 times before it sells, each time paying for a listing fee.

Years ago, you could be almost guaranteed that if you listed an item, you may get 5, 10 or 25 bids on it and it would eventually sell -- after only listing it once. Now, you have to list the item many times, and it may never sell or it might only generate one low bid. The formula doesn't work anymore.

But because of its monopoly, it is the only large site to generate traffic to even get a trickle of interest. A buyer's market for sure. But not truly since sellers cannot make money easily they inflate shipping fees. I have personally bought items for $1.00 and paid $11.95 to ship it. the item may have been worth $15 but the seller anticipated he wouldn't be able to generate enough interest to get bids up high enough so raised the shipping fee.

I am slowly moving to new sites, one of them being Blujay.com -- they keep it sweet and simple.
http://www.blujay.com/bluemagnoliablossoms

I have revisited business plans, invoked many new strategies in the past few months but as I said the formula doesn't work as I pay too high fees for what
EBay delivers. Its the monopoly dilema: This icecream cone will cost youn $1,000.00. If you want it then pay the fee, but no one else is selling it so its your fault if you complain.

Pit Bulls huh? I like the analogy. Even dogs will turn on their masters when abused. For me Ebay management’s abuse is arrogance. Ebay sellers were once their partners but now management looks down upon their lowly sellers. Their arrogance is they feel they no longer need their partners in growing their business. To grow their business their arrogance would rather raise fees to the point of putting many sellers out of business. Then their arrogant attitude is; too bad, so sad, bye-bye. Ebay’s management is so far out of touch with it’s sellers it’s not even comical. Many sellers worked very hard and put a lot of time and effort to build and promote their stores. In one arrogant move it was all wiped away. Excuse me if I won’t take the bite off of this issue.

Sheldon, unfortunately you will be getting more of the same type of posts, when pit bulls (sellers) are cornered they lash out. Unfortunately, because of the short attention span of investors and the market as a whole, sellers are finding it difficult to get traction for their concerns. By the way, Graham's post was well thought out and he presented his position effectively. Others posters facing real issues and are doing what they can to keep the issue alive.

Unfortunately, only time will tell if the sellers concerns were legitimate or not. In my view current management is creating a mess that future management will need to correct. I have enough knowledge of the marketplace to see this clearly. Investors are A.D.D. (my apologies to those who actually have this disorder) I just hope their memories are long and they will be able to remember when sellers were ranting and raving about the fundamental problems eBay faced in the summer of 06'

Ebay raised fees over 500% in my case. They were already collecting about 25% of my gross sales of collectibles. The additional fees were unconscionable.

My store consistently did not show up in Search, even though the items I sold were highly specialized.

At the same time, I am competing with Asian sellers who can list for free, fraudulent sellers who never ship period, unscrupulous sellers who sell for a $.01 penny with outrageous postage (to evade final sales commissions), sellers who sell counterfeit items, and then Ebay has the audacity to tell me MY good reputation, honest dealings, and steadily selling items aren't worth THEIR server space?

How many tens of thousands of posts have been made on Ebay's discussion boards asking these very questions, asking for help with numerous system glitches, questionning bogus listing "sales", and nary a response from anyone at Ebay. Even the Town Hall meeting tonight deliberately dodged the burning issues, and pandered to silly questions like "how can I save a search" or "Can I use Fedex to Ship?".

It's like Ebay just doesn't really care about sellers, of ANY size.

Sellers are buyers, too. Just ask the sellers who are asking, "Where have all the buyers gone?" I have neither bought nor sold on Ebay in nearly a month, since closing my store.

If I were an investor, I would be paying close attention to the stores discussion boards and asking questions myself.

Ebay has a Public Relations nightmare on it's hand. Years of good will and community affection, going down the drain.

These folks who ebay "put out of business" with their recent fee hikes wouldn't last two days in a "real" business. If their profit margins were that low they didn't have any business in "business" to start with.

Not everybody wants a Big Business. But having one's sales go from 'useful and contributory to the family budget' to 'nonexistent' by what appears the flip of a switch....let me tell you, it sucks. More: it hurts. And it has been done as casually and as carelessly as stepping on bugs.

In this case, though, the 'bugs' are among the people who have been paying the bills. It's rude to crush them.

I started my store in March and the results were ok for a start up .I started with a feature store as thats what Ebay recomended.Then came the reversal of policy by ebay .In my case it worked out to be a 255 increase in rental + 500% increase in listing fee and an extra 3% (7% to 10 %) on final value fees.To me I could have tolerated that just . Then came the change in search. This in the end was the one that killed thje magic for me .The fact is in the change led to a drop in views to my store by 75% in page views and 90% in unique vistitors .I have not had one sale since this happened. My store is selling Genuine Designer lable swimwear not knock offs not copies but the real item suposidly I am one of the customers that ebay wishes to keep.Also by being based in Australia I am expected to pay a priemium on my fees and rental as compared to USA and at the same time be satisfied with a lesser service.At the same time we as well as all fee paying countries on ebay have to compete with Ebays China fiasco and the zero fees that they pay .We object to subsidiseing these sellers and ebay for its bad investment there .On top of all this Ebay has failed to police certain countries in regard yo scams and fake (copies ) of designer lables.
To say that we have not done anything to voice our objections is blatently wrong .In Australia a number of Ebayers have started a class action suit against Ebay . The same has started in a number of other countries. As well as the french sueing Ebay for copyright infringements on designer lables. Most sellers are voting with their feet and simply moving to other sites as you have said I have as well as starting my own .com.au.And when the analists wake up to whats happening and the number of legal actions about to start Ebays shares will take a hammering and rightly so.If I was investing in auction sites I would be looking elsewhere and dumping Ebay stock. And yes we are angery and yes we are rabid about it Ebay was and is deceptive It lied to all the people That started stores and devoted 1000s of hours to carve out a small Buiness of their own on the web .More that the money its this that people wont forgive Ebay for .

Leigh Thomas

Hello,
I hope a few simple words from a simple man will be admissible. While Mr Bough may be a successful in the " real business world " I doubt he has the information to promulgate his ability to succeed on ebay. respectfully sir,. With that said I would like to leave something for men much more informed in the area of which this thread is drawn, stocks. The ebay business was unique, competition is on the horizon looking waiting for weakness, as it always is. Ebay's strength is derived from it's very name! You say ebay people say " Ya were I can go an get a good deal on most anything I want! " Not so many people reply the same way today. If this recent " straw " Is spoken so much of, the hay that had burdened the beast who's back was broken is now following suite. Ponder this, if in fact the name of ebay becomes synonymous with things such as, fraud? Theft? rip-off?
raunchy? What affect will this have on a large percentage of ebay buyers/sellers, and shareholders? Just something for one to watch and see I presume. G'day gentleman

Steve......

OK, apologies for the targeted remarks and your thoughtful response was genuinely appreciated.

Although I have been a vocal critic of eBay lately, I do agree with the main thrust of this post and, indeed, much of what you say. I am genuinely fed up of hearing most of the personal complaints over and over.

But I'm looking beyond the complaints and asking why this long saga is apparently never ending? From the viewpoint of a reader on this site looking to invest in one or more of the featured stocks what would I learn about eBay here?

Personally, while not particularly bothered about individual complaints, it is the sheer amount of these moans and groans following me all over the web that would worry me!

That has to be symptomatic of a real problem. People are going anywhere they can to be heard and that usually happens when someone at home refuses to listen and talk.

Listening for eBay doesn't mean the fee hike gets reversed but does mean they should demonstrate they care about and want to be in touch with their customers. Management shouldn't appear to actively avoid or censor the subject whenever it gets raised. When talk fails the frustration sets in and people start to get bitter and twisted. This is what I think we are seeing.

Next thing you know, the bitterness makes people think eBay has fallen out of love with them. The old auction site isn't really eBays love anymore. It's just a "job" they have to do to pay the bills while they go tap dancing with Google, flirting with Yahoo, holidaying in China and even dressing up in new clothes (shopping.com Express Skype & half.com).

As an outsider looking in it really does concern me that such a huge success could be placed in such danger by one of the most fundamental mistakes in business.

A few cuddles from eBay, some listening and a few token compromises on some areas would probably make all this vanish. But why don't they do it?

I suspect the good news will be handled by a new CEO. Watch the stock price then!

I suppose you could even take this view as a reason to buy ebay stock at current levels but, the risk is I'm wrong and you are then stuck with a dog (that's the stock I mean).

Graham

Everyone so far has made some very valid points. Most of you know I have given your issues and concerns many hours of thought, research, writing, follow-up comments and more. One thing that seems abundantly clear is that Ebay created new opportunities for people that did not exist before. They have reduced those opportunities, contradicted themselves, and also responded poorly to the pleas for understanding and cooperation from people that they should consider their business associates. I do not know why this is so, but I do know that it is very damming evidence that something is wrong. I have written on many different subjects for bloggingstocks and my editors have given me great latitude. In one diversion I chose to share my thoughts about Merck (which I own) with our readers and how I was not overly concerned about their potential liability of ten's of billions of dollars. As an investor I am actually more worried about Ebay. Merck is addressing their problems head on and Ebay is not. But as an investor my concerns go deeper than any discussed here. I do not like their options program, executive compensation, management shuffling, circumvention of issues, and I hate the Skype deal. If my trust in management had not been weakened I would have no problem giving them some leap of faith based on their track record with Half.com, PayPal,Ebay Motors, Shopping.com etc. Now I cant. It is becoming a convoluted mess and the ill will just makes me say to myself there are better, less complex, safer places to invest my money. As I will do with my investment dollars, I think sellers should do with their time and energy -- move on. Introducing a concept from the real estate world. If they fail because of their short sightedness, then someone else will build a better company/building using their tombstone as a foundation for a new company -- it's time to move on. Respect and Peace to all in your journey's

After almost 7 years on eBay with two stores I am expressing my outrage over the new fees by closing the stores and opening my own store site (which doesn't use Paypal). Thank you eBay -- your greed got me moving to develop my own site and put your fees in my pocket. My cost recovery is six months and I will think of you each time I pocket one of the thousands of dollars I paid you each year.

One other thing. I asked specific questions in my post and no one has addressed them yet. The discussion going on here, while genuine, and articulate, does not answer my questions it is more of what we have already seen in comments from past posts.

Keep smiling...

Ebay promoted stores, i tried it, liked it and then they started to take away all the things that made it good. I had to down grade to a basic after i was getting no sales. I do ebay part time with a regular full time job/sometimes overtime. Several months when I was working overtime i was still getting sales and hits when I couldn't list auctions....then later, when I had more vintage books and antique books (3 x more inventory) I wasn't getting any sales if I didn't have time to list auctions. In fact, one week I had sales that I had to drive to the site from outside avenues where I post ads. Ebay just collects the money.

Appreciate your comments in 14 Sheldon, think we're on a similar wavelength.

I'm not really qualified to answer many of the direct questions you posed in the OP. However one I will answer is about the proposed AOL forum.

My answer is a big loud No! Just take a look at eBays own forums on this subject and you want another one? LOL

You do however pose some interesting other questions and I would be interested to see the eBayers here respond. Personally I'm not aware of any actions going on along the lines you have questioned, but am I wrong?

Sheldon,

Maybe this issue has gained alot of attention because it affects THOUSANDS of Ebay sellers, not just the '15' as claimed by Meg Whitman. Ebay are keen to play down the current unrest as limited to a 'small but vocal group of sellers'. Just a glance at any of the Ebay forums (in all countries with the exception of China) will exemplify just how dire the current situation is for many on Ebay. Furthermore, the fact that Ebay are 'deleting' many negative comments in their forums can only result in sellers venting their frustrations elsewhere.

As for Steve Bough's comments, how would a 'normal' high street business survive being told that their rent is going to double, whilst simultanously being told that their shop is going to be moved to a back ally? Oh, and they have 3 weeks to adjust to this. Your comments that dismiss anyone who shows the ambition of anything less than a megalomanic is actually very typical of the view of Ebay's management.

Ebay admitted themselves that the 'magic' had gone, for which they blamed shops (they didn't consider it was the abundance of scams and Far East listings that may have caused this). Furthermore, instead of dealing with the seller's concerns following the fee hike (with the exception of Ebay Canada), Ebay seem more concerned with their preoccupation of turning their site into the world's biggest traffic jam (such as the Google Ad Merger). The only way to put the magic back, is to make Whitman and Cobb disappear from their current positions. Meanwhile, many sellers have moved to other outlets such as Ebid and Tazbar; they just need the buyers to follow them.

One of the protests groups that has formed, 'CORE', have planned a 4 day buyers and seller's strike between 15th and 18th September; as well as a concerted effort to rid Ebay of all its dodgy listings and scams.

This issue will not 'go away'. The sellers, as well as buyers, are going to shout louder, louder, louder and louder until we actually find ourselves being listened to by those in Ebay HQ, who seem to have a very distinct hearing problem.

Peter,

You've made an extremely good point that often gets lost in all the fee hike moaning. OK, so fees have gone up. But many of the more professional eBay sellers I talk to are more focused on the very point you have raised.

It wasn't just a fee hike, it was a store hide too.

I'm reliably told this has reduced sales for one fairly large store owner to just 20% of what it was a couple of months ago and most of that is from repeat customers who have added him to their 'favourite sellers' list.

He, like you, is realising that it is pointless to pay eBay subscriptions, listing and final sale fees if he now has to buy the traffic to his store from Google ads or wherever.

His decision was to begin working on his own website and buy the traffic to go there. His thinking is to cut eBay out of the food chain that lives on his sales. So peversely it looks like eBays loss could be Googles gain.

I suspect a number of the bigger and more organised store owners are quietly doing likewise and the real exodus has not been seen by eBay yet. It will take weeks or months to get sites built, stocked, online and indexed by Google. Most will then probably run in tandem with the eBay store for a while but, eventually, the eBay store will go to be replaced with just a few core listings for continued marketing and signposting courtesy of eBay.

I wonder if some of the smaller eBayers that are so upset at the moment aren't putting their energy in to form partnerships with similarly affected sellers and build their own websites? Surely a postcard seller could partner with say a coins and stamp dealer to make a single site including all their inventories?

Anyway, back to eBay with a thought for shareholders. If stores are closing, how much monthly subscription income has been lost? If the remaining stores have reduced inventories, as has been reported, how much listing income has been lost? If stores have had a massive drop off in sales, due to being hidden from searches, how much final sales fee income has been lost? I don't think I'm talking insignificant sums here.

Sheldon's asking the right questions. There are good reasons to be lobbying significant shareholders.

I can understand the frustration at so many posts receiving comments from aggrieved store owners, but don't forget this is about money, stockholders money.

As has rightly been pointed out eBay prints money, but the ink and paper supplies are no longer being delivered. The reason this is rumbling on is eBays management's inability or unwillingness to deal with it. The only way to defuse the situation would be a complete backtrack, unlikely, and even if they did, I suspect that it is now too late.

So what does this mean for stockholders, bad news I'm afraid, eBay will not be able to deliver increasing income from a reduced client base, both sellers and buyers. It has relied on the eBay name, but that is now so tarnished as to be of little value.

Just ponder this, where would eBay make its money if, and I say if, all the sellers left, not the buyers, the sellers. That tells you how vunerable this company is. I cannot change my view that this is stock is a SELL why you still can.