Muga Wa Kabbz
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I'm not sure, but I think that eBay owns part of paypal. They make their money from paypal via seller's fees when they use paypal as a payment system; there's also a small listing fee for posting your item for sale.
They make money also from advertisement banners at their main page, when sellers can for an extra fee include an advertisement about an item or service.
I believe there is also a fee for setting up and maintaining an eBay store. EBay makes a heck of a lot of money. |
Dethruhate
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Ebay makes profit in a number of ways.
First they charge the seller to list the item. They up this payment by offering add-on services, like the ability to have your item listed in bold or in an outlined box, or have more pictures listed with it, all to make your item stand out more.
Then they take a cut of the amount that you sell it for. This is usually based on a varying percentage. X% for the first $300, a little lower % of the next $1000, and then an even lower % of the next however much.
They also own paypal, which is the preferred payment method for ebay. So if the seller collects the money through paypal then they also take a cut of the money sent through paypal, on a similar varying fee schedule to the selling fees for ebay.
Also, with paypal they offer a sub-market exchange rate, so if you're paying in different currencies, they are able to match up people who are looking for opposite currency exchanges (bob has dollars but needs to pay in euros, and bill has euros but needs to pay in dollars). They exchange both peoples money at worse than market rates, and since they handle the exchange internally, are able to keep the spread. |
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