Trademe – but not (fully) for me

Trademe trapped

All over the web you will see people mention this popular website as a go to in New Zealand to sell unwanted items and even make money selling handcrafts, new import products or as an adjunct to your own self employment. In certain areas this no doubt works well. I’ve been selling on Trademe for years. Or so I thought. When I ran an annual profit and loss (cashflow report) on my sales and direct costs, my belief I was ‘selling’ and making additional income to support family, was shot entirely to dust. The worst aspect of this is that I am money smart when it comes to business. But this was an oversight I’ll not easily forget.

If you are looking to sites like Trademe, read my story following and ***do better than me for your own sake ***

As said, I have been selling on Trademe for years and for some product types this is still a great way to make money. I am sure. However my main line of product is general trade / home hardware and lower value tech items (memory, cards, storage, fittings etc). Figures here are rounded but fairly accurate.

I was turning over $1000 a month. Most of the items I was selling was stock that had been written off or from closed businesses over the years. Now that I also am not full time as a systems engineer / tech, I was selling down my wiped off inventory over time. But I have a ton of small value items to go through. Enough to last retirement, easily.

I reached a point where I was doing over the $1000 a month (more like $1200) and thought, given there is little margin (cost of product) I could start a Trademe Store. At the time my Trademe Fees as an in-trade seller (as I was also importing small tech items for sale) was around 6.99%. Then there were payment fees (mostly Ping payment system via Tradem or Afterpay which costs about 2x Ping fees.) These are around 3% (Ping) – 5% (afterpay.) Trademe had made payments easier by its own weekly payment system so you could go into debit and it would pluck the balance owed from your credit card every Thursday. Easy peasy.

I use Xero accounting. This means every cent out and in is accounted for. Easy also. I use a lablel printer for shipping goods, also easy. I created preprinted envelopes and labeled track packs. Also easy. Things were going well. My dream to reopen a store arose.

I contacted Trademe and they made me an offer to open a store at a reasonable monthly fee ($92 per month?) and allowed me extra sales incentives such as bold, high placement. All good. It increased my allowance from a base of 50 at a time to 150.

I was selling over $1000/monh, being 80+ sales/month given the low value of goods. Charging postage or tracked pack fees at a rate that allowed for printing an invoice, a label/packing and allowing for Trademe/Ping/Afterpay who take their cut even from teh shipping fees. So… basically 10%-12% of the sale value including shipping is taken by the Trademe System (6.99% Trademe fee, 3-5% payment processing fee) Let’s just say 11% and in future… below… use the same average rather than 10-12% eh.

About six months later the fees went to 9.99% for my range of products as an in-trade seller. So I had to adjust the selling prices. I was mostly using Buy Now rather than setting items on auction. That was because I had found when you set things at auction with say $1 RES (a $1 starting price), volumes of your items would get sold for a mere $1. Even if the average item was worth on sale $20. It seemed like people no longer liked outbidding each other on small hardware items (they used to. Times had changed it seemed.)

When the fees went up and I adjusted, my sales dropped to around $800 a month. Higher costs, less income. But I was still selling and thought life was good.

Then trademe jumped the hardware line fees to 12.99% plus payment fees. Meaning the average fee on any of my items was now 17%. All the way from 9%.

I had to make yet another adjustment. And found over the following say three months my sales plummeted by 50% approximately ($400-$500/month.) Well, in January 2024 I sold just 28 items total. Just $300 before costs. This month with one week to go with over 200 items for sale on Trademe, I have so far sold 24 items. So the figures do not lie here.

And don’t forget, through all of this, I was paying $92/month trademe website fees for a so-callled online store with a limit of 150 items (when I have probably 500 item lines I could sell.) Tough juggling.

To be fair, I had also started importing such as batteries, memory, general tech products and putting these on trademe. Some lines actually sell well and I had established my top sellers where mostly imports by December 2023. Imports have costs remember.

So I jumped on Xero this month, February 2024 and asked Xero what my sales less direct costs of sales for the twelve months to 31 Jan 24 was. And it was a shocker. It said my average monthly sales value was $528 and my average monthly cost of sales (cost of import, trademe fees, Trademe store fees and delivery charges) averaged $526 a month. WTF. I work my sales and activities for around 2 hours every morning. That is 700 hours a year more or less. And for that 700 hours I earned $24? Who the hell works for 64 cents an hour?

One thing I had not factored in the above, which adds 15% costs, especially as the written off stock doesn’t have a cost, so it’s pure profit, is GST. Another thing I had not factored in the above, which adds 20%+ costs, especially as the written off stock doesn’t have a cost, so its pure profit, is Income Tax. Neither GST or Income tax came into the above Xero report.

I was literally feeling fucked over. Excuse the expression but it is worth it. I was over the last few years literally working beyond my income for Trademe and our Tax system and because of those two factors literally working for an unavoidable loss.

Contacted Trademe to cancel my online store. This takes effect at the end of this month (in a week.) Immediately i will save $92/month. Given I am not selling the volume of items I should be, I can reduce to under 50 top selling lines, allowing a few spaces for quick sale random items, I fugure. I can set Trademe to not list above the 50 limit saving me excess listing fees.

loaded over 200 items on trade exceeding my limit, being charged 10c every time an item is loaded in excess of the limit (so like thats another $40 cost already) trying to clear goods while I can.

Loaded some items on Auction basis with a $1 RES but have since stopped. Every $1 RES item that got sold, did not get bidders. Just one each bidding at $1 reserve and nothing more. So that doesn’t work does it. Trademe to me is no longer a auction site IMHO unless you have an amazing auction item. It’s a bargain basement and people knowingly taking the $1 RES with every right to the product once the auction closed, won’t give a toss. Thanks. No thanks.

I am working through records to determine my top 50 items. I will load 30 of those at a time on Trademe a further 10 backup workshop items and 10 random but vigorously marked down clearance items at a time. Trademe is no longer going to be my main channel but I could make it a smart operation. I am just over the wasted time and energy and the loss of dead space in my working area at home I could do with for activities such as the podcast programme.

And I have my website at http://www.selectec.co.nz so will be gradually putting every single item for sale on there with a clear note IN STOCK, WELLINGTON, NZ. No ‘limits’ as if we’re unresponsible children. Why do certain droppshippers get permission to load 20,000 items? Why exactly? And I can drop ship at http://www.selectec.co.nz with absolutely NO LIMITS. Not that I would. I prefer importing so you get your items quick. Over the years I have become a ‘platinum’ importer from a few very large channels so will look at that too.

And then there is Facebook Market. Well, Facebook market is totally miss and no hit. I have sold 2 items on that platform. Will have a revisit.

Anywhoo… the moral is… don’t be a Kevin. Who are you working for and is it worth the time? Do you want to earn 64 cents an hour?

I am humbled by realising the above happened like a snake, easing you into a false sense of security. No rose coloured glasses here.