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Ebay "deteriorating" - mass layoffs expected

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Monday, 15 September 2008, 15:08

EBAY WORKERS may be in for a shock they didn’t bargain for, with a report claiming the firm is floundering and preparing to lay off about 10 per cent of the company's 15,000 employees.

According to an article in Barron's Weekly which cited a recent report by investment-boffins at Wedge Partners, the online auction giant’s business is " deteriorating".

Current economic hardships - especially weakness in the consumer economy- added to the fact that quite a few Ebay sellers have been severely hacked off by recent changes in fee structures has put Ebay in a tight spot.

"Seller discontent with eEbay is on the rise due to higher fees and other changes, and we believe Ebay has seen numerous sellers migrating away from the Ebay platform and creating their own selling sites," wrote Brian Blair and Ryan Hunter, two Wedge analysts.

To add salt to Ebay’s wounds, because about 50 per cent of the firm’s revenues come from outside the U.S., the auction giant’s finances are set for another beating as the dollar continues to strengthen.

"We don't have a handle on how much of the slowdown is due to economic conditions and how much is due to competition and execution, but we do believe a decline in these key metrics presents continued risk for the company" wrote Blair and Hunter, adding that gross merchandise volume for the third quarter could be well down from the $15.7 billion level reported in the second quarter.

“EBay shares are down approximately 30 per cent this year, trading near their lowest level in five years" the report continues, noting that 1500 jobs in the company are at immediate risk.
The company is apparently also taking a huge risk with a soon-to-be-released search platform currently being tested.

At the end of the day, however, no matter how much Ebay suffers in the short term, it's really the employees who may be sold short. µ

L’Inq
Barron’s (Subscription required)

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Comments
Not a big surprise...

Considering what some friends that used to be very active selling like yard and garage sale style on eBay finding that eBay seems to prefer those who buy in lot amounts and resell.

People simply cleaning out their closets aren't welcomed anymore it appears. I've bought several things and had some things set aside waiting to sell, but I guess I will hold an actual yard sale (won't even charge shipping and handling!) to get rid of.

In one way I was sorry to see Yahoo!'s Auctions close, but there was an awful amount of junk being sold there where eBay makes a showing now and then to keep things from getting too 'junk sale'. What we need is something somewhere in between.

One friend used to track certain areas out of curiosity. She put a pretty beat up pair of high heels like what a lot of college girls around her town loved to wear and they sold for more than she paid for them new. As a result she found a new venue there (the so-called "well worn" area of womens' shoes), but one really closely watched to make sure pictures and descriptions were "family friendly". She decided to stop selling when they no longer seemed to care about what went up and stopped enforcing posting rules - all she wanted to do was make money selling beat up heels, not sell herself in the meantime (she is aware of the fetish surrounding this, so she isn't naive either!). We both decided that was just another sign of the beginning of the end for eBay, at least as it was known back in its good days.

I'm trying to figure out how they can use 15,000 people for just the auction, so I wonder if it includes the other venues they have, too.

posted by : CapitalW, 15 September 2008 Complain about this comment
"Buy it now" option?

I'll bid for it. I have 500 Billion in Wal-Mart money orders, I hope they'll take the selling price out of it, and send me a wire transfer for the rest.


posted by : Jon, 15 September 2008 Complain about this comment
Let down by Ebay/Paypal yet again

No Dave dont do it, dont click buy now, no,no,no, dam to late, click, the button it is a-pressed, I have already semi forgoten how they (paypal/ebay) screwed me last time, by saying they wont help me get my £ 156 back from a "legit"? company on their site. Still whats the chance of it happening again, well, the answer is every chance.....Its happened again! Grrrr, still as always its not Ebay/Paypal at fault, it's me for being so Dam stupid and using their site, the only plus this time is it wasen't as much. Stupid me,I will never look at their site again, well maybe just look, oooooow Ive always wanted one of those, click.........

posted by : Dave, 15 September 2008 Complain about this comment
Maybe this?

Maybe ebay's beginning their decent because they royally cheesed-off their once-loyal customers. Go check out ebay now - it's nothing but a collection of small business sales. (At least the stuff I'm looking at.) There's absolutely no incentive for me to buy or sell on ebay anymore. What little profit I could have made goes right into their pockets. Between ebay and paypal the fees are simply out of control.

posted by : Kris, 15 September 2008 Complain about this comment
Total cock up

With the general turn of things being in a downward direction, this should be the time to cash in on all the private sellers who need money from selling their old tat. But Ebay has pissed off private sellers by turning itself into platform for businesses to sell on. And then, bizarrely, implemented a series of policies guaranteed to piss off those very same businesses it forsook the private sellers for.

No wonder it's in a crap state.

posted by : Naich, 15 September 2008 Complain about this comment
serves um right :O)



i hope fleebay self destructs and takes paypall out with um, the sooner the better !!!! 

its there own fault, greedy barstewards have killed the 'goose that laid the golden egg' their punters have been telling um for the last couple of years, but the dumb furkers just ignored the very peeps that fed their money cow, O_o


posted by : psychochief, 15 September 2008 Complain about this comment
It's not our fault!

The management would like to emphasize that the current business downturn is not its fault, and is absolutely NOT due to throwing away eBay's near-monopoly position in the auction market to go whoring after bigger profits by trying to imitate Amazon, who have eaten the lunches of everyone who tired to compete against them in the fixed-price retail market.

posted by : Robert M, 15 September 2008 Complain about this comment
Greed

Glad to know the predictions of the sellers who told ebay this was coming are playing out.

Ebay got greedy and thought it could keep the same amount of sellers and sales, even with increased fees, and pocket the difference as profit. 

Hopefully this is a wake up call, and ebay either puts the old price structure back in place, or goes even lower. It's just not worth selling on the site otherwise.

posted by : John Smith, 15 September 2008 Complain about this comment
Receipt

With Billpoint's disappearance and the advent of PayPal (see also http://www.nopaypal.com/ ), and because of eBay's inability to deal with fraudulent sellers (and buyers), continuous harassments such as unreadable HTML encoded mail to eBay half.com customers, unavailable customer service, ever increasing fees, frequent warning messages that search lists get wiped, malfunctioning checkout web pages ETC. ETC. ETC.
I HAVE NOT USED EBAY FOR YEARS
(and I have a positive feedback at eBay close to 1000).


posted by : eBye eBye, 15 September 2008 Complain about this comment
Consider Potential

In Spite of being BIGGEST Chimpster on internet, ebay & lot o' auctioneers, intercollided by Search sidebars, all would do much better if just sold correct item instead of i'm not sure....item. Its lot of cram for just next fit over, defective parade. Thinking of billions already in many software developements, Product got confused with:How To Commit thieft Reliably. Oral report of eleventh gt\rade porportions. Altering your existing bank acounts is just part of action long term, so be warned.
drashek

posted by : Thinker, 15 September 2008 Complain about this comment
I just got me a FX-62

I just bought a FX-62 wicked-bad CPU for $100 off of FleaBay, in fact it just arrived last Friday. Brand new with fan, no foolin'. Box is a little threadworn but the merchandise looks okay.

Now I ask, where are you ever going to find something like that except for FleaBay?

(tonight, I shall find out how the "other half" have been living the last 1.5 years or so).

posted by : Grunchy, 15 September 2008 Complain about this comment
Why am I not surprissed?!?!?

i'm sorry for all the employees that will be losing their jobs, is sure not their faults but the company's. 

ebay has been treating honest sellers like crap ever since the disaster of 2004 and the company has been plunging ever since, this is just the result of years of bad, really bad management! 

top all that with constant and permanent changes which drive nuts both customers and sellers, the increase of fraudulent sellers, chinese and canadian copycats, con artists and a flood of copyright infringements, frauds, scams, copies and the alike and this is the result, the venue is going down, and is going down hard!! 

honest sellers kept fighting with ebay's heads to implement ebay's own policies against the frauds that happened by the millions and instead they preferred to protect all the frauds and illegal sellers and pretend nothing happened on their servers. for years they have lied the media saying frauds happen on a very minimum scale, lies! they happen by the thousands a day, they know it and still look the other side!

customers and sellers are not stupid and they will look for better places to sell and buy and what better place than their own websites!! real honest sellers don't need ebay, ebay need honest sellers and quality customers and yet they haven't figure it out ha! they sure deserve what is happening to them.

and as for the current heads of ebay they should be highly responsible for taking a business format that was incredibly successful because it was SIMPLE to use and ruin it transforming it in the best place for frauds and scam artists to thrive.

shame on all those who called themselves ceo's of ebay, you shouldn't be allow to manage your own bank accounts.

posted by : one more PO seller, 15 September 2008 Complain about this comment
15,000 people work at Ebay, where?

What do these people do? How could ebay need anything close to 15,000 people?

It just seems like too many people for 1 auction site where the buyers and sellers do all the work.

posted by : interested_party, 16 September 2008 Complain about this comment
good

Rot in hell ebay you greedy peeps. Why don't you learn from google and don't naff off your customer base.

posted by : rob c, 16 September 2008 Complain about this comment
8 1/2 years of Ebay

I remember buying my first item on Ebay in early 2000, a Russian camera to replace one I had bought and subsequently dropped in Eastern Europe circa 1991. That set off a whirlwind of buying and selling where I sold off many things I later regretted, and have only in the past week finally gotten the last of it "back." (A genuine World War Two bomber jacket).

I've hated Ebay, tolerated Ebay, but was only wowed by it early on. For the past four years it's only been the resource I use when I can't find things anywhere else.

I don't bother in bidding wars, I use an auction sniper, and I don't care about great deals and bargains. 

Changing it around so buyers couldn't leave negative feedback was probably necessary as too many power sellers were using negatives to sack unwary buyers who had the temerity to complain about broken or misshipped items.

But the whole deal could have been avoided if Ebay hadn't encouraged power sellers to arise in the first place. I kind of feel like writing them and saying they ought to pull an Elvis, going back to the roots of small Mom-n-Pop sellers having online garage sales.

However, the cat is out of the bag and dollar signs rule it all. I'll leave the idiots to spend half the night hunting to save $15 on a wide screen plasma TV and stick with the occasional camera lens or antique. To be honest, though, 1/2 the time I still find better deals elsewhere............

posted by : Scott, 16 September 2008 Complain about this comment
Good riddance

I normally love success but in this case, I can't think of a company I'll be happier to see go. Every time in the last 10 or so years I used eBay to sell something, the experience was VASTLY worse than the time before, with spam, vapor bidders, being stiffed, etc. They provide no *real* tools to help manage 0 or low rated bidders (yeah, they let you exclude negatives, as if there was ever such a thing as a negative bidder in the history of eBay... right...) It got more and more complicated to the point of ridiculousness. And then the recent bird they flipped sellers in the rating reorg.

posted by : androticus, 16 September 2008 Complain about this comment
Agree with every negative post

I was going to post something substantial but the guys have already said it all for me. Ebay got some footguns really cheap and have been using them religiously for the last 4 years. Nuff Said.

posted by : KevinR, 16 September 2008 Complain about this comment
huh?

>> 50 per cent of the firm’s revenues come from outside the U.S., the auction giant’s finances are set for another beating as the dollar continues to strengthen.

Huh? Was logic not taught at your school?

If half is from outside the US then the other half is from inside the US. This means the strengthening dollar will help the half inside the US as much as it hurts that outside the US. Net result = no difference.

posted by : Justniz, 16 September 2008 Complain about this comment
Bargains Galore Identity Protected

I love Ebay & Paypal. Ebay is the only realistic protected place where I can sell or buy second hand goods online worldwide with decent prices and a never ending and constantly updated catalogue. Thanks to paypal, I have never lost money on ebay and feel safe trading online. I wish there were more alternatives to Ebay & Paypal but presently when it comes to getting rid of the house clutter, unwanted gifts, feeding the addiction or save on government theft in the name of VAT, ebay is the only saviour. I have never been let down by Paypal when dodgy sellers who try to sell lemons, plus it is very cheap for international purchases(charges commission on foreign exchange) compared to UK banks who make you pay through the nose for even a small bank transfer abroad. Only damper is the high rates Royal Mail charges and high rate of items lost due to its excellent track and lose systems & employees who can not be asked or bothered while performing her majesty's service.

posted by : Sam, 17 September 2008 Complain about this comment
See 'Ya fleEbay

-Don't let the door hit 'ya in the arse, and please turn off the lights.

posted by : 1insug3nt, 17 September 2008 Complain about this comment
Good Riddance!

Good riddance you greedy, selfish, pathetic slugs at E-Bay! I quit selling last year and i haven't looked back! It is great to see E-bay go under, if those slimy pigs saw that sellers were doing well, they had to try to slip their sleazy, grimy little pig hands in there to get the profits the sellers were making! UN FLIPPING BELIEVABLE! I hope E-bay goes down hard, and the heads of it down at the welfare office!

posted by : Johnny, 17 September 2008 Complain about this comment
Good. They deserve it.

Greed will imprison us all or them all... Them sons of bitches rob me twice already so they can go and f' themselves. And this was daylight robbery!

More profits, more profits and the soon to die... just like politicians and all the BS they come up with - everybodys wrong but them till eventually they get voted out of office and then they realise maybe the world doesn't revolve around them.

These rich ceos and morons need to listen to people everybody can't be wrong about something. I remember the outcry from sellers when they introduced paypal as the only payment method.

I have always been using the old fashioned cheques and i didn't mind waiting i think it's the most secure thing ever. And i ain't one of those fat lazy gits who can't even get to their banks so always use online banking - and getting robbed and card details stolen etc, etc...

On the flip side some if not all hackers are poor bums so in that case the lazy people should get robbed.

By the way, i hate credit cards as it only incourages you to get into debt while they charge you huge interests rates.

That's enough i'm off to the pub.

posted by : Joe, 17 September 2008 Complain about this comment
Craiglist

Craigslist is also a factor, no fees, no shipping and handling to worry about, it's a great alternative to Ebay.

posted by : The One, 17 September 2008 Complain about this comment
sweet justice

haha - serves them right for being greedy

posted by : nigerian scammer, 17 September 2008 Complain about this comment
CORPORATE KARMA AT ITS BEST

As an ex Gold Level Powerseller I'd been telling my Aussie buddies for years that ebay was in self destruct mode. All of them, even the Platinum levels were saying, "No, no, just minor shifts & changes, we'll work around them".

eBay screwed over its loyal community once too often, they grabbed the wrong end of the snake & now it's turned around to devour them.

You miserable, mealy mouthed AH's at the top of the management chain have destroyed many people's lives in varying degrees and now may your company come to its knees as it deserves to.

Haven't sold diddly squat on ebay in months & nor will we .... from $40k per month buying & selling ... that's gotta hurt & we were only small fry.

posted by : Wilks-Alpha Australia, 17 September 2008 Complain about this comment
Just stupidity, or...

It's barely comprehensible, how ebay can have made so many bad decisions in the last few years. It would be hard to think of anything they possibly could have done to piss off their customers, that they *didn't* do.

Bloated, slow site html, making page refreshes painfull slow? check. Non-existent customer service? check. Taking a perfectly workable, nice and simple selling method (ebay handles the listing, buyers and sellers finish the deal via email) and mangle it into an overcomplicated, autocratic, inflexible mess? check. Take over any secondary service companies (paypal, bidsnipers) and then Borg them? check. Attempt to force everyone to use ebay's subsidiary Paypal only, thus double gouging customers (in Australia as a bastardry test run)? check. Have a perfectly workable customer rating system, and then make it irrelevent and ignore it among a mountain of bogus 'security' measures? check. Mess up the site front page with disgustingly horrible graphics that look like the product of an advertising agency on crack? check. Fill customer's mailboxes with insanely legalistic and verbose email, while making it difficult for customers to simply email each other directly? check. Make every appearance of gleefully cooperating with government pressure to report your customer's smallest transactions to tax offices? check. Turn the entire site into a garbage dump of bulk merchandising and advertising? check!

Then wonder why your customers are leaving? Ha ha ha! Stupid ebay deserves it.

But wait... What's really happening here?
eBay began as a great service, and revolutionised the ability of ordinary people, anywhere in the world, to sell stuff to each other. With virtually no way for governments to 'manage' those transactions, save from making sure the fascists in national Customs points did their so-annoying jobs.

Then, quite suddenly, eBay management appears to go collectively insane, and starts doing everything conceivable to drive the company (and the service) into failure.

Now, putting my tinfoil conspiracy theorist hat on here... suppose someone up there in the elite-o-sphere had decided that letting little people sell stuff to each other via that damnable Internet was a bad idea, and ought to be stamped out. How would they do it? Without letting on that they were stomping on it, or even that they wanted to?

The answer would be - infiltrate management, and kill it from the inside. Just as seems to be happening.

Just a crazy theory of course. We all know everything just happens by chance and stupidity, and there are no such beasts as conspiracies and deceptions. Don't we?

posted by : TerraHertz, 17 September 2008 Complain about this comment
good ridance

bill point was great, paypal sucks. last Item I bid on was 6 mo ago. I won the auction but it went too cheap and seller refused to send it even though I had paid. ebay refused to back me up and force seller to ship. I quit.

posted by : john, 18 September 2008 Complain about this comment
eggheads

Boy those MBA eggheads really goofed up Ebay.

Will they go under, or run off the MBA's and bring in someone who knows something about business?

posted by : Governor, 18 September 2008 Complain about this comment
No surprise

It's really no surprise this is happening. As a occasional seller I find that the new policy of witholding auction proceeds for up to 21 days is ludicrous. For small sellers like me, we use auction proceeds to pay for shipping. What I find interesting is that while being held, the funds are not earning interest for the seller and, of course, Paypal has immedialy deducted its fees. There comes a point when you just have to cut your losses.

posted by : Doug, 21 September 2008 Complain about this comment
Paypal and poor customer relations will catch up with eBay

I used to buy and sell a lot on Ebay but haven't touched it since Paypal became mandatory for sellers. Just Google "Paypal Horror Stories" to find out why.

Ebay has a lot of momentum from the days when it used to be good, but now it's hand in hand with Paypal (basically not much more than a criminal racket) and has appalling customer relations; its future is probably destined to be mainly selling grey imports and dodgy/fake merchandise - i.e. people who can't sell anywhere else.

posted by : Chris, 28 September 2008 Complain about this comment
auctions8.com Worth A Look

eBay has become unbearable for so many reasons. Some sellers are regrouping at a new international auctions site www.auctions8.com & starting fresh where first 1000 to register get everything is free for life.

www.auctions8.com is owned and managed by determined & hard working group of members to become a permanent and safe home for all.

Site is for genuine sellers only

DO NOT PAY ANY FEES. EVER AGAIN!

posted by : Jenny, 02 October 2008 Complain about this comment
Funny how that works

When you treat the sellers like they are the problem instead of the ones paying the bills, this is the natural happening that results. The US Economy is almost irrelivant in this becuase this downturn on eBay has been growing and building for many years now. 

Donahoe has driven a very good thing into the ground. After 10 years there, I pulled my auctions and do not buy there.

posted by : me, 22 October 2008 Complain about this comment
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