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Fred Koschara

disturbing

I’ve stopped selling on eBay

Jul. 03, 2018, under bad business, bootstrap finance, disturbing, really???

Purple turtle figurine, previously for sale on eBay

Purple turtle figurine

I recently sold a small item on eBay:  I bought a 10-piece lot of small turtle figurines a few years ago for $40, so the cost for each item is $4.00.  I had them listed for $4.95 each, plus shipping, so my gross margin on each sale would be $0.95 – not a lot, but at least it looked like a profit.

At that price, I couldn’t offer free shipping.  I listed the shipping and handling as $1.00 for handling (to cover the cost of a box, packing material, tape, etc.) plus the actual cost of shipping via the customer’s selected method.

The customer paid $16.36 to buy this $4.95 item – eBay added $11.41 for shipping and handling to the bill, which astounded me.  As it turns out, though, that wasn’t out of line, considering the actual cost of sending the package from Wellsville to Tulsa, Oklahoma via FedEx Home Delivery was $10.39 (after eBay’s bulk discount):  The assessed shipping and handling charges left me with $1.02 to cover the cost of materials.

Adding the gross margin from the sale, plus the handling fee, it would appear I gained $1.97 from the transaction.  The problem, though, is that there are fees involved:  eBay charges a 10% “final value” fee for sales at this level, so I had to pay them a commission of $0.50 to make the sale.  Fair enough, but now my gross margin is $0.45.  Then, PayPal charges 2.9% plus $0.30 per transaction to process the payment – so PayPal collected $0.77.  Now my gross margin has disappeared, and I’ve already lost $0.32 on the deal – and that’s assuming my time has zero value, and there were no costs in packing the figurine to send it.  Using those assumptions, I’ve still had a net income of $0.70 because of the handling charges that the customer paid.

However, today the last nail in the coffin arrived:  eBay’s invoice for the month of June shows they have assessed a $1.14 “final value” fee on the SHIPPING CHARGES!  Ignoring everything else, that means they charged $0.12 more for their profit on my mailing the package to the customer than I received as a handling charge.

Together with the gross loss from the transaction, the loss from the shipping charges means I had a net LOSS on the $4.95 sale of $0.44.  No business can survive with a 10% loss on every deal.  That plan is fundamentally flawed, and is the reason I will no longer be trying to sell things on eBay.

I tried sending them an email about the situation, but I expect it will bounce…

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What people will pay for …

Sep. 29, 2017, under disturbing, opinions

One of the SPAM messages I looked at today claimed to be from Fairfax Finance Limited, offering business loans and startup capital.  I was suspicious if for no other reason than because the “fairfax.finance.limited@europe.com” email address looked bogus.  (It turns out europe.com is a parked domain, so how would legitimate mail go through it?)

In my research to see if Fairfax Finance Limited is a real company (which it apparently is, but not related to the email), one of the links Google provided led to a page on ZoomInfo.com that appeared to have some information in an expanded view.  I enabled Javascript for the page, and clicked the “more…” link to see what they had – and got a pop-up window that was trying to get me to install an executable program!  Of course, I shut the window and did NOT install the program, but instead started doing some research on ZoomInfo.com itself, especially after reading the terms and conditions in the popup window that included “… in exchange for downloading and installing the ZoomInfo Contact Contributor utility which, among other features, involves sharing my business contacts as well as headers and signature blocks from emails that I receive.” (emphasis mine)

There’s a Wikipedia page about the company, saying it’s a subscription-based SaaS site that “sells access to its database of information about business people and companies to sales, marketing and recruiting professionals.”  The Wikipedia page also says “Part of the company’s business model involves copying contents of web pages and storing them on its servers, and according to patent attorney Gene Quinn who runs the IPwatchdog intellectual property blog, this activity violates copyright law.”

So, from what I can see, this company builds its database by scraping public info off the Web, and by reading emails its users receive to collect contact information through software the user is expected to install and run on their system – for the sole benefit of ZoomInfo.com!  Then, ZoomInfo turns around and sells that information back to those same users, and to anybody else they can get to buy it – and people pay for this??!??!??  Apparently so, since the company has been in business since 2000 and has 100-200 employees.

… and we wonder why we have so much SPAM …


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