When eBay announced last month that it would change the way it treats Buy It Now and Best Offer transactions to reduce unpaid item claims, we expected to hear a collective cheer from eBay sellers.
Instead, we heard a lot of uncertainty and doubt about how this change would impact everything from sales to feedback to inventory management.
In case you missed it, eBay announced in its Spring 2013 Seller Update that, starting in May, certain fixed-price items won't be considered sold until the buyer actually pays. In a departure from the current practice on eBay, "sold" items will remain available to other buyers until someone hands over the money.
It seems simple enough, until you consider the different ways people can buy things on the eBay marketplace, and how the rules vary for these transactions.
Here, we answer some of the questions that came up following eBay's news.
'Eligible' listings are less than $1,000, paid for with PayPal or a merchant credit card, where shipping cost is specified
What is changing, exactly?
Starting in May, buyers who "buy" a fixed-price item won't own the item until they pay for it. Currently, these buyers can commit to an item and come back later to pay. Going forward, commitment and payment will be merged into one step.
In the case of a Best Offer, the seller can entertain and even accept multiple offers for an item until someone follows through and pays.
What types of listings or transactions apply?
The change to Best Offer transactions initially applies only to listings in Art, Computers & Tablets, and Jewelry & Watches. It will gradually be introduced in more categories.
The immediate payment change—which will be rolled out to most categories by the end of the year—applies only to eligible fixed-price listings and auction-style listings purchased with Buy It Now. "Eligible" listings are those less than $1,000, paid for with PayPal or a merchant credit card, where the shipping cost is specified for the buyer. If you offer local pickup on your listings, then the immediate payment requirement will not apply.
Does free shipping qualify as a "specified shipping cost"?
Yes. If you offer free shipping, then you are specifying a shipping cost—in this case, the cost is zero.
What if the buyer is buying multiple items?
If you offer shipping discounts for multiple-item purchases, eBay recommends updating your listings to instruct buyers to use the shopping cart and purchase everything at once. However, an item placed in a cart is not considered "committed to" by the buyer, so it's possible that another buyer can purchase that item before the original buyer gets around to paying for it.
This is the way it works on most e-commerce sites, so it shouldn't come as a shock, eBay notes.
If Buyer 1 puts an item in his cart, but Buyer 2 swoops in and pays for it first, only Buyer 2 can leave you feedback
What if the buyer is waiting for an auction to end to combine shipping with other items?
You'll still be able to offer combined shipping to that buyer. The buyer can add items to the shopping cart and purchase everything at once when the auctions have ended—assuming the items in the cart are still available.
When the buyer is ready to check out, they can click the Request Total button in their cart to request an updated invoice with the shipping discount included. If you use eBay's combined shipping discounts feature to offer shipping discounts, the discount will automatically be applied to the order total in the shopping cart.
If you don't use this tool but still offer combined shipping discounts, your buyers will have to add the items to their shopping carts and request new invoices with the revised shipping cost.
What if the buyer wants to pay cash on pickup, or send a check?
This change only applies to transactions where the buyer selects PayPal or Merchant Credit Card as their payment method. There is no change to transactions where the buyer selects other payment options (for example, real estate, industrial equipment or vehicles).
If someone pays before my first buyer, can Buyer 1 still leave feedback?
No, only the person who actually purchases the item can leave feedback or Detailed Seller Ratings. If Buyer 1 puts an item in his cart, but Buyer 2 swoops in and pays for it first, only Buyer 2 can leave you feedback, as there was no transaction with Buyer 1.
If a buyer "commits" to buy an item but hasn't paid yet, is my inventory still reduced?
For a Buy It Now transaction, the item is not taken out of inventory until it is paid for. In the case of Best Offer, only after a seller accepts an offer and the buyer then commits to the purchase will the item be removed from inventory.
Buyers expect an immediate payment experience because that's what they're used to on other e-commerce sites
Can I opt out?
No, eBay is applying this change to all qualified transactions.
Can I still use the Immediate Payment option?
Yes, but when you require an Immediate Payment, buyers won't be able to request an updated total to apply a shipping discount to a multiple-item purchase.
Will this affect the way eBay charges final value fees?
Final value fees are only applied when a listing sells. Since eBay will no longer consider a listing sold until it's paid for, the final value fee won't be applied until payment is received.
Will eBay educate buyers about the change to Buy It Now purchases?
According to eBay, current eBay buyers are familiar with this type of experience because many eBay sellers already require immediate payment when listing items. Buyers who are new to eBay also expect an immediate payment experience because that's what they're used to on other e-commerce sites.
How will this change work with Best Offer transactions?
eBay says it will clearly message buyers that, even though a seller may accept their offer, the item is not officially theirs until they commit to the purchase. Once a buyer commits to purchase the product, eBay will remove it from inventory so a second buyer can't purchase the item.
eBay further says it is educating buyers in the initial three categories that they are required to take the additional step of committing to the purchase—which in most cases means paying for the item.