So you are looking to sell a few items online and find yourself torn on whether to list the items on Ebay or Amazon. Well, allow us to guide you through both companies so that you can make a decision as to which you should utilize as your primary business broker.

Ebay started out and became well known for its auction style of selling, however, recently this has changed dramatically to a fixed price format as the habits of buyers have changed from fighting at the last minute for an auction vs. the easier method of finding a fixed price and comparing with other alternatives.

Amazon, well known for music, books, and other media has since changed into a giant megastore which offers almost anything and everything under the sun.

As you can see, both are headed for a direct head to head battle as their primary target base (buyer) is close to being the same.

A recent quote from a NYTs article: “EBay could have closed the door to Amazon back when Amazon was mostly just a platform to sell books and music,” said Scott Devitt, an analyst at Stifel, Nicolaus & Company, the investment bank. “But what eBay did in those days was to take a very hands-off approach and let the marketplace control itself. And that ended up being the downfall of the business relative to others that have succeeded.”

That stated, there still exist dramatic difference between the two companies from a sellers point of view concerning listings, flexibility, fees, payment processing, etc. We will go into these.

LISTING:

Right here is an area where both companies could not be further apart.

Ebay allows full control over your listing including HTML coding, pictures, graphics, etc.

Amazon on the other hand only gives the seller a text box for the description-that’s it.

Ebay allows you to sell just about anything with a few exceptions such as weapons, bombs, etc. For Amazon, what you want to sell must already be listed with Amazon to sell to begin with. You just sort of piggyback your listing onto an existing ad.

So for flexibility, Ebay wins hands down, but for ease of use, the winner is Amazon.

EXPOSURE:

Both sites receive a ton of traffic. Though Ebay had a lead here with an estimated 80 million hits a month early on in 2008, it’s traffic has dropped significantly to around 60 million hits whereas Amazon has seen its unique hits increase to 70 million a month. So we will call this one a draw.

FEES:

With the recent price hikes from Ebay, it is no longer considered the low price alternative to Amazon. On top of the Ebay listings fees, factor in the Paypal fees as Amazon does not nor does it need to accept Paypal as it has its own payment processing facility, all of which is already factored into the selling fee. Paypal fees are around around 2.9% for lower prices items. Also of note, Amazon gives a special ,”shipping credit” after a sale to offset some of the shipping cost. Something Ebay does not offer. The problem here is that the shipping fee can very well be lower than the actual cost and this must be considered when setting a price on Amazon. Ebay allows the seller to set their own shipping fees or use built in custom calculators for the buyer.

Because of all of the difference in fees, it makes selecting a winner difficult? Generally I charge a higher selling price on Amazon to make up the shipping fees as their credit almost always does not cover the realistic shipping cost. If I am selling an item for $150.00 on Ebay, I will sell it for $160.00 on Amazon. Take for example a personal copier I sold on Amazon. The credit I received for shipping was $15.99. Actual shipping was $22.45.

There are advantages and disadvantages with both companies when it comes to fees therefore we call this one a draw.

FEEDBACK:

Ebay made a very controversial change in their feedback policy a few months ago that stripped the sellers ability to leave negative or even neutral feedback for a buyer. Their thought process was that it would force sellers to be more accurate with their listings as well as to improve their customer service which in turn would lead more buyers to sellers listings. While that may hold true in a very few instances, it is our experience that from a sellers point of view this change has hurt sellers more than helped them . We have had more than a few instances where a buyer now threatens us with negative feedback if we did not change our terms of the auction, reduce shipping, etc. Though this form of blackmail violates Ebay policy, it is very seldom enforced by Ebay to the point of protecting the seller.

Amazon has the tried and proven method of allowing both parties to leave feedback, positive or negative, for either party. This has and still is the preferred system for a seller.

Advantage by a large margin: Amazon.

SHIPPING:

Purchases made through Ebay and paid via Paypal have the advantage of a integrated shipping tool through either UPS or the USPS. They even give a discount for UPS shipments.

Amazon on the other hand does not and you must enter in the shipping information yourself which can be tedious as well as allow mistakes to occur. Amazon does offer a FedEx discount but then again, everything must still be entered manually.

ADANTAGE: Ebay

One other advantage of Paypal over Amazon is that you generally have instant access to your Every little bit adds up. When we purchased out washer and dryer we received 1% back on the purchase.

So who wins? If your keep score it seems Ebay has the slight nod, but we would say that it is a draw. It really all depends on what your selling. Personally, for many items I use both services. At times Amazon does better, other times Ebay does better. Amazon does give us less hassle with buyers though. It seems in today’s economic hardship climate, everyone is more sensitive to their money and this carries over onto Ebay auctions. Its seems everyone wants to deal outside the box of common sense as they try to take advantage to better their position in a transaction. Amazon transactions as a while have given us very little grief from buyers.

Financials:

eBay:
(In Millions of USD)
Income Statement Quarterly
(Jun ‘08)

Total Revenue 2,195.66
Gross Profit 1,633.56
Operating Income 545.37
Net Income 460.35

Amazon:
(In Millions of USD)
Income Statement Quarterly
(Jun ‘08)

Total Revenue 4,063.00
Gross Profit 967.00
Operating Income 217.00
Net Income 158.00