I love the part about how they are aware that all the changes they
are making are and will continue to effect their revenues in a
downwind fashion.
is that head-up-your-assery to the max?? you know it's going to
effect you negatively, but determine it's the direction you wish to go.
Can you imagine what will happen to California if Meg Whitman becomes
Governor????
At 06:28 AM 2/18/2010, Bruce Hershenson wrote:
eBay's 10K Acknowledges Seller Dissatisfaction
By Ina Steiner
AuctionBytes.com
February 18, 2010
"As a publicly traded company, eBay presents risk factors in its
U.S. Securities and Exchange (SEC) filings, including legal matters,
and describes how they could impact the business going forward. In
its current 10K filed with the SEC this week, eBay discusses the
impact of its campaign of changes to the Marketplaces unit:
We have announced changes to our Marketplaces business intended to
drive more sales and improve seller efficiency. Some of the changes
that we have announced to date have been controversial with, and led
to dissatisfaction among, our sellers, and additional changes that
we announce in the future may also be negatively received by some of
our sellers. Given the number of recent changes that we have made to
our policies and pricing, it may take our sellers some time to fully
assess and adjust to these changes, and sellers may elect to reduce
volume while making such assessments and adjustments or in response
to these changes. If any of these changes cause sellers to move
their business (in whole or in part) away from our websites or
otherwise fail to improve gross merchandise volume or the number of
successful listings, our operating results and profitability will be harmed.
The company goes on to say that its mix of sales would continue to
shift towards a fixed-price format. "Accordingly, we have eliminated
some of the features related to our traditional auction-style format
and expect others will become less meaningful to, and used less
frequently by, our sellers, which would result in a corresponding
decrease in revenues from such features. In addition, we expect that
the costs associated with our seller discount programs will increase
as more sellers will become eligible for such discounts."
eBay also said changes to its dispute resolution process in which it
generally reimburses buyers for the full amount of an item's
purchase price and shipping costs could increase its costs and loss rate.
"We expect that our costs associated with resolutions will increase
as we make these changes to our resolutions policies and process.
These changes, together with any further changes that we may make to
our resolutions process in the future, may be negatively received
by, and lead to dissatisfaction on the part of, our sellers. These
changes may also result in an increase in buyer fraud and associated
transaction losses. In addition, eBay does not have the same rights
of recoupment against sellers as PayPal, which may result in higher
costs to operate the program."
The
<http://online.wsj.com/article/BT-CO-20100217-718929.html?mod=WSJ_latestheadlines>Wall
Street Journal noted that 10K also states that the lawsuit against
eBay's Bill Me Later unit could force the company to alter
operations, cut some fees and pay substantial damages that would
adversely affect business.
Government regulation is also cited as a risk to Bill Me Later.
"Although Bill Me Later does not originate loans, one or more
jurisdictions may conclude that Bill Me Later is a lender or money
transmitter or loan broker, which could subject us to liability or
regulation in one or more jurisdictions."
Likewise, eBay's PayPal unit is at risk from regulation. "If our
Payments business is found to be subject to or in violation of any
laws or regulations, including those governing money transmission,
electronic funds transfers, money laundering, counter-terrorist
financing, banking and lending, it could be subject to liability,
licensure and regulatory approval and may be forced to change its
business practices."
Government regulation continues to be a risk to eBay, including a
push for legislation by retail trade associations that would make
eBay liable for the sale of stolen property or would ban certain
categories of goods from sale on eBay, including gift cards and
health and beauty products. "No such legislation has passed.
Nonetheless, the proponents continue to seek passage of such
legislation, and if any of these laws are adopted they could harm
our business."
The full filing with financial data can be found on the
<http://www.sec.gov/Archives/edgar/data/1065088/000119312510033324/d10k.htm>SEC
website"
SO DONAHOE PRETTY MUCH ADMITS HE IS RUNNING OFF SELLERS AS QUICK AS
HE CAN, and HE ADMITS THEY ARE GETTING RID OF AUCTIONS.
I feel more certain than ever that the eBay of two to three years
from now will have solely mega-sellers, and no auctions. Even if
they shrink to half the size, they will still be more profitable,
because they will be able to lay off 95% of their employees.
And tens of thousands of smaller sellers will be put out of business.
Bruce
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