I followed this discussion for quite a while now and it appears that there are basically two kinds of sellers using GarageSale: volume sellers, for which the subscription model and price increase doesn’t seem a major problem and those selling unique items, like collectibles or spare parts, for which the price increase is more problematic, because they have many (> 50) unique (quantity = 1) items.
I belong to the second category.
Like Neal, and others, I am “old-school buy-it-own-it for software” and basically more a Windows guy than a Mac one. So, I had bought a second hand MacBook especially for using GarageSale, because after the end of TurboLister it was the only standalone that I could find as a user without an eBay monthly subscription plan (at the exception of another one that I knew: etope lister).
Recently, I carried out a study comparing eBay and Amazon margins.
I was wrong, because I missed that eBay also takes its 10% margin on shipping costs.
Example: for an item at 5$ with 15$ shipping cost, Ebay’s 10% margin is calculated on a 20$ value.
Given that PayPal takes 4.4% on cross-border sales (vs 2.9% on domestic sales), and assuming that the fixed fee of PayPal is 0.30$ (assumed same as for a domestic sale because not mentioned), Ebay+PayPal margins would be 70.6% for the cross-border sale of a 5$ item with 15$ shipping costs.
Marketplaces-and-payment-processor-fees-for-American-individual-seller_v3.zip (10.5 KB)
Paypal margins are even much higher in my country than for an American user.
I did’t count the additional exchange rate margin that the buyer supports.
I don’t know if Amazon also has similar practice of charging on shipping costs.
So, trying to answer Ilja’s question:
Knowing this, you should ask yourself if the value/time saved that GarageSale provides to you really isn’t worth those $15/month we are asking for.
… let’s make a little math.
Assume the seller has 100 unique items listed (spare parts or collectibles), with a mean value of 50$ per item. Shipping costs: 15$/item.
Total value (including shipping): 65$ per item (for the computation of fees)
Margins of Ebay+PayPal for a cross-border sale (as reffered to the 50$ item value) : 20% (see attached Excel spreadsheet.)
Assume that this user sells 10% of his inventory every year.
So, 10 items sold per year, for a turnover of 500$ (without shipping costs).
Price of GarageSale Pro subscription : 15$/month, so 180$/year.
180$ / 500$ = 36% of the sale volume (10 items sold at 50$ each)
So, the total cost of GarageSale subscription + Ebay (without subscription) + PayPal (cross-border) in this situation would be 56% (36%+20%). Leaving 44% of the sales price for the seller …
I think iwascoding’s team is missing a very important element : eBay’s strength (as compared to Amazon) is still for “garage sales”, i.e. for collectibles and spare parts.
Keep in mind, that GarageSale is a niche application, with only a few hundred active users (some of which a very demanding). That means the cost of maintaining GarageSale has to be split among only these few users. Naturally, you might need to pay a little more compared to non-niche mainstream applications
GarageSale addresses a specific need, but there is no reason for it being a niche application.
It should be a mass market application. (Or killer app if you prefer !)
It is difficult to find stats about the number of sellers on eBay.
Let’s assume it is 50 millions (https://www.quora.com/How-many-sellers-are-on-eBay)
If 10% use a Mac, it is still 5 millions.
If half of them speak either English, German, French or any language in which GarageSale is available, it is still 2.5 millions.
So, there is still potential for a huge growth of the consumer base.
Even without subscription, you could segment the market.
With an entry-price limited software (e.g. 19$) and more expensive software variants (with more modules or allowing more items). Let’s say 70$, 150$, 250$ or some prices like that.
Don’t forget that in countries with lower income than Germany, even a 40$ expense for a software can be important.
Growing the user base massively, you could then possibly rewrite the interface with Qt and reach even more millions of Windows users.
At night and during weekends with been working on GarageSale: continuously integrating eBay’s and Apple’s changes, handling user support, fixing bugs, etc…
PS. It’s 10.30 PM now. Arrived at the office at 9 AM this morning.
For sure you have been working hard on the software but I believe you should focus on the core (integrating eBay’s and Apple changes) and outsource some tasks like :
translations - : I know a developper that for instance offers a free license in exchange of a free translation. This is a win-win deal for growing your user base for a almost null translation cost.
community support - Not closing the topics after 10 days would avoid new threads being constantly opened for matters that were already treated. Amongst your multi-years users, some could possibly provide help for newcomers, so that you have more time for coding.
templates : Since I’m familiar with (X)HTML markup, new templates are totally useless for me.
A few templates as examples are always useful, but building templates is not essential and can be left to users / partners.
special features : features like “Send with Endicia” are totally useless to me. Maybe could they commercialized as optional modules and provide you additional source or revenue. This would also help you to see which modules your consumers are ready to pay for (and worth maintaining) and which are not.
You could possibly also give up some “gadget” changes like:
- adds support for ‘Dark Mode’ appearance on macOS 10.14 Mojave.
One more thing:
… betting the company on our ability to ship a major upgrade in time before the money from the last upgrade runs out
Major upgrades are sometimes necessary, but reading you it seems you’re facing a working capital issue. Aircraft manufacturers know very well this situation, because developing a new (serie of) aircraft(s) can last 15 years before the first plane is ready for sale. If they minimize their need for working capital or something goes wrong and is delayed, they can very easily go bankrupt.
But with software you could commercialize minor upgrades to your existing user base.
For instance “upgrade from GarageSale 8.1 to 8.2 for the amount of …”.
The users who upgrade would benefit from new features before those awaiting the next major release.
When I see how many new features you coded, this is awesome. You may have commercialized less ambitious versions meanwhile.
As you understood, altough I understand your need to massively increase your turnover, I mostly agree with Freedolin and others that there might be better options than your new subscription model.
Don’t take it bad.