Mercari Did WHAT?! – The Changes Coming to Online Selling

I sell stuff a lot, and I’ve been doing it now for over 15 years or so. I really got into it when I was trying to make money to put toward my wedding. After that, though, I just never really stopped. If you’re already familiar with me and what I do here, I was knee deep in the thrifting world, and that just yielded stuff that I could resell. When I started out, I used a storefront website called eCrater, where you sort of put your own “branding” on their readymade template, and that’s where “Will’s World of Wonders” was born. I used that site for a couple of years, and I’m always amazed that I sold anything over there, because the platform did NOT look “legit”! Over time, however, even I started to doubt its legitimacy, and I knew folks had more faith in established sites, so I moved everything over to eBay. That did well for me for another few years. Until it didn’t. Luckily, around the time eBay started petering out for me, I discovered Mercari during the pandemic. Mercari is a Japanese e-commerce company, and they seemed to specialize in the sort of things I liked to buy and sell: action figures, comic books, electronics, etc. I mean, yeah, you could buy clothes on there, but sites like Poshmark already had that wrapped up. To say I went “all in” on Mercari would be an understatement! Since 2020, I have completed over 900 transactions, where 600 of them were sales on my part. In that time, I have recommended the app to anyone who’ll listen, and some have tried it out, while others remained skeptical. Still, nothing good lasts forever, and that became apparent when I did something this morning that I never do: I read Mercari’s updated Terms of Service. What may initially sound good is actually not good. It’s not good at all.

The first, and biggest change, is that the app will charge 0% in selling fess for any listings created going forward. This is big because Mercari, like eBay, would charge you a percentage of your final sale price as, basically, “the cost of doing business”. It made sense, as they had to make their money somehow. They’re not running a charity. While Mercari’s 10% might seem high, it was a flat fee, while eBay’s Final Value Fee ranges from 6-15%, depending on the category of the item being sold. On eBay, musical instruments were about 6% while clothing was 15%. This meant that you had to do a lot of math. Not so on Mercari, as 10% is a pretty easy figure to do off the top of your head. Well, now they’re not going to charge that anymore. Clearly this is to encourage more folks to list items, and help them enlarge their footprint as a selling outlet. But how are they going to make money now? We’ll get to that shortly.

This next change is what I feel is the worst change: Buyers will now be able to return items for any reason. Yeah, ANY. At this point in the selling game, there are pretty much 2 standard reasons that sites allow buyers to return items: Either the item was broken OR it did not arrive as it was described in the listing. On eBay, this was known as “INAD”, or Item Not As Described. I mean, these are both reasonable situations to request a return, right? But when you open the gates to “ANY”, then all manner of foolishness is going to be unleashed. As eBay has sort of evolved into a “legitimate business” for some, people have become familiar with its rules. Mercari, as the fledgling app, is a little bit more of the Wild West. I’ve had predominantly positive experiences on the app but, overall, I trust Mercari users much less than I trust eBay users. I mean, there’s the same ratings/feedback model of most sites in place. In fact, you can’t really get your payout on a sale (Unlike eBay, Mercari holds the money as an intermediary until the sale is completed, i.e. item actually arrives) until the buyer rates the transaction. If they don’t rate within 72 hours, then Mercari releases your funds to you. A lot of folks new to the platform don’t fully understand the importance of rating, which leaves the seller waiting an extra 3 days for their payout. At the end of the day, there are constantly a lot of newcomers to Mercari as it expands, and I just see this “open season” on returns as a problem waiting to happen. Changed your mind? Didn’t like how the color looked in the lighting in your house? Didn’t actually read the item description before purchasing? ALL accepted reasons for returns now under Mercari’s new rule.

This third change is one that puzzles me most, as it seems sort of ass backwards compared to how transactions work: Remember how I was wondering how Mercari would make their money, since they’re no longer charging a percentage on sales? Well, that’s because they’re charging a percentage on PURCHASES. The cost is being transferred from sellers to buyers, as any purchase will now result in a Service Fee being charged to the buyer. So, on top of shipping and sales tax, the buyer will also be responsible for this fee, and the amount of said fee isn’t spelled out as a set percentage. But they’re not done with the buyer yet! On top of those 3 charges, Mercari’s also charging the buyer a Payment Processing Fee at the time of purchase, which is $0.50 plus 2.9% of the transaction price (which includes item price, shipping, services fee, and sales tax). The only way to avoid this fee is if you’re a seller who carries a balance, and you use said balance to buy something from someone else. I’ve sort of already been doing this, as I haven’t really withdrawn my money from Mercari in about a year. Anything I make goes right back into the pot, so, I basically sell in order to buy at this point.

Finally, there is now a flat fee of $2 per cash-out to a checking account. Folks who use Paypal or Cash App are already familiar with something like this, but Mercari used to only charge that fee if the withdrawal was under a certain amount. Not anymore…

To align with these changes, Mercari is giving sellers the option to adjust their prices in one fell swoop, to account for the removed selling fee. When I opened the app, I was asked if I wanted them to do it, or if I wanted to do it manually. I guess they’re operating under the assumption that all items are priced 10% higher, to account for the previously charged selling fee, and they’ll just automatically drop your prices by 10% to entice more buyers? I don’t trust anything automated, so I’ll take care of mine myself. It’s also worth noting that any listings posted prior to 8 AM today will abide by the old rules, while anything listed from that point on will have the new rules applied to it. So, look for most users to delete and relist their items over the course of the day, in order to refresh their listings and get out of the previously charged selling fee.

The new Mercari rules look really good for sellers, but they’re not so great for buyers. As someone who primarily buys more than he sells at the moment, I already find a lot of the prices too high. Too many folks trying to pass off items that are on clearance across the country as “new and rare” items for 4x retail. As a buyer, it’s hard to find a lot of “deals” because it’s an environment devoted to the spirit of “No lowballing! I know what I’ve got here!” I have always offered “free shipping” by simply wrapping the cost of shipping into my list price. When folks try to lowball me, I always point out “I’m covering shipping and fees”, which was true. Now that fees are being taken off my plate, however, not only do I no longer have that as a defense, but it also gives an already finicky buyer more power. When you add to it the fact that said finicky buyer can now also return for any reason whatsoever, what you end up with is a recipe for disaster. I just might have to go back to eBay.