eBay Powerseller Scam

For those that have been living in a cave for the past decade, there is an online marketplace called eBay that allows for almost uninhibited sale transactions between sellers and buyers. This online auction has reserved a special status for sellers that do exceptionally well in sales performance, feedback performance, and abiding by the rules of eBay's marketplace. The most important parts are without a doubt sales performance and feedback. To be invited into the powerseller program a seller must have at least 100 feedback ratings and 98 positive feedback. Sellers with 100 that they will bend over backwards for buyers to avoid a negative feedback, and that includes succumbing to ridiculous demands and feedback exhortion from buyers. Powersellers in general are able to create more buyer activity for their eBay listings, both positive and negative.

How eBay benefits from the powerseller program.

In one word: Fees. Ebay is funded on the fees of sellers and advertising revenue, and sellers contribute to a major portion of the bottom line. Remember a powerseller is a member that averages at least $1,000 in transactions per month. This average monthly sales is a gross figure (literally and figuratively) that does not take into account the possible wholesale cost of the items sold or the triple layers of fees that eBay takes as commission. This is illustrated in the examples below:

How anyone can achieve the minimum sales level to become a powerseller (which is the hardest part):

1. List 4 ebooks for sale in the informational products category for 3 months. It doesn't matter if they sell, this is solely to meet baseline program requirements.

2. Buy 3 cars for $999 each ($2,997 total), and then sell 1 car a month at a price of $1,000 for 3 consecutive months ($3,000) in sales.

3. The seller now has made sales transactions of $3,000 for 3 consecutive months and meets the $1,000 average in the eyes of eBay.

4. Unfortunately the seller has only made $3.00 profit for 3 months ($1.00 per month average), but the seller is still considered a powerseller.

How fees affect the powerseller:

1. Ebay charged this seller $40 as an insertion fee for each car auction ($120 total).

2. Ebay charged this seller $50 as a final value fee for each car auction ($150 total).

3. Paypal (an eBay company) charged this seller $29.30 to process payment for each car auction ($87.90 total)

4. Ebay and Paypal have charged this seller a total of $357.90 while the seller only made $3.00 net in the same period leaving the seller with a negative net total of - $354.90 that eBay has collected.

5. Ebay gives the seller a password for a forum (free), a powerseller icon (free), and a certificate (paper, ink, postage).

This example illustrated how you can lose money and still be considered a powerseller.

In truth, the powerseller program has nothing to do with the success of a sellers eBay business but rather how much eBay can extract from the seller per month in fees. Of course most powersellers are profitable, but the fact remains is that it's just a slap on the back "attaboy" for those that pay more in fees per month than the average seller.

© 2007 Mark Hudson

Permission is granted to reprint this article for use on your website so long as the article remains intact and viewable by website visitors and author's resource / bio information below is also intact and viewable.

This article was authored by Mark Hudson, a Powerseller and independent webmaster. You're invited to visit http://www.clubbid.com , http://www.gladlist.com , and http://www.freewagon.com

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