Every product has a Manufacturer Suggested Retail Price (MSRP) and a lot of
retailers tend to dip their prices a little bit below that amount so that their
customers can save a little money. If you go to any website you will see small
5% to 10% discounts off of merchandise but if you go to eBay you will see larger
discounts of 50% to 75% off of merchandise.
Due to the fact that everyone wants to sell merchandise on eBay, supply is
exceeding demand. When supply exceeds demand the price of goods will decrease
dramatically. Everyone knows eBay is the place to get a good deal but it is
difficult to realize how people still can sell merchandise on eBay at such low
prices and still make money. Especially with eBay fees and shipping cost being
so high.
The fact that profit margins are being cut so drastically should make eBay
store owners question the future of their eBay businesses and maybe even eBay in
general. The more competition that arises on eBay the lower prices will go and
the less money people will make. That will eventually leave them to close shop
and that will hurt eBay‘s revenue stream in the process.
