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How Much Is The Marketplace Commission Supposed To Be?


Marcus Hancroft
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I have an item listed on Marketplace at a special price of $10L.  One of those items delivered during the night last night and this morning I had a notification in my e-mail detailing the distribution.  Below is the relevant information:

"Purchased on: May 09, 2011 11:38 pm PDT

Buyer's Price (for delivered items): L$10 Distributions Total (for delivered items): L$9 Marketplace Commission (for delivered items): L$1 Your Earnings (for delivered items): L$0"

I thought the MP commission was 5%?  If the commission was $9L on a $10L item, that's something on the order of 90% commission.  Or are the rules different for inexpensive items?  If I had an item listed as a freebie, would I then OWE commission to LL? 

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Strange...I just ckecked listing page and still have the old rules:

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Seller Sales Commissions

We charge SL Marketplace merchants a Commission for each sale that the seller makes (“Commission”). Commission rates are five (5) percent of the listed price, rounded to the nearest Linden Dollar (L$).

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Hmmm...am I reading the distribution wrong or something then?  Maybe it's $9L total profit, $1L commission, total balance $0L?  All my sales in the past have been correct, and this is the 1st time I've ever gotten an e-mail like this so maybe I'm just not reading it right.  

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Marcus Hancroft wrote:

I have an item listed on Marketplace at a special price of $10L.  One of those items delivered during the night last night and this morning I had a notification in my e-mail detailing the distribution.  Below is the relevant information:

"Purchased on: May 09, 2011 11:38 pm PDT

Buyer's Price (for delivered items): L$10 Distributions Total (for delivered items): L$9 Marketplace Commission (for delivered items): L$1 Your Earnings (for delivered items): L$0"

I thought the MP commission was 5%?  If the commission was $9L on a $10L item, that's something on the order of 90% commission.  Or are the rules different for inexpensive items?  If I had an item listed as a freebie, would I then OWE commission to LL? 

 

Oh I see now.  It is correct.  It's just written out without line breaks.  This is how it should be listed to prevent confusion:

 

Buyers Price (for delivered items): L$10

Distributions Total (for delivered items): L$9

Marketplace Commission (for delivered items): L$1

Your Earnings (for delivered items): L$0

It shows *MY* earnings at zero because I listed this for one of my business partners and keyed in 100% for his Revenue Distribution.  OK...I got it now.  :-)  All is right with the world again.  *laughs*

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Marcus Hancroft wrote:

I have an item listed on Marketplace at a special price of $10L.  One of those items delivered during the night last night and this morning I had a notification in my e-mail detailing the distribution.  Below is the relevant information:

"Purchased on: May 09, 2011 11:38 pm PDT

Buyer's Price (for delivered items): L$10 Distributions Total (for delivered items): L$9 Marketplace Commission (for delivered items): L$1 Your Earnings (for delivered items): L$0"

I thought the MP commission was 5%?  If the commission was $9L on a $10L item, that's something on the order of 90% commission.  Or are the rules different for inexpensive items?  If I had an item listed as a freebie, would I then OWE commission to LL? 

According to this LL only took L$1 i.e. Marketplace Commission (for delivered items): L$1 which would be the 5% rounded. 

The Distributions Total (for delivered items): L$9 goes to the person you are splitting the sale with.  Perhaps you have indicated this split in error?

ETA: I see you came to the same conclusion at the same time I was posting this.  Glad it worked out :)

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Josh Susanto wrote:

If you charge 10L you should get paid the same amount as if you charge 9L. 

Because of the 5% thing, the 10th L paid just goes to LL.

Why are you charging your customers that 10th L if you'll never receive it?

Howdy, Josh!  :)Well now that's an interesting question and one I have no answer for.  If I charged 9L, wouldn't LL still take 1L for commission? 

 

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They would not, and they DO not.

I have gradually deprived LL of a pile of money that my customers get to use to buy more stuff from me.

If a combined order is more than 9L, then LL gets something, sure.

But a lot of orders are for one item, and some are for 9 items.

Exponents of 9 are a statistical sweet spot where the proportion of order payments lost to commissions is minimized.

If your metrics are so precise that you know an item should be priced at 11L, then maybe you should price it at 11L, but 10 just doesn't make any sense (to me). Note, though, that pricing categories end in zeroes, not in nines, even though the lowest one also starts with a zero.

Why do you think that is?

 

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