From the “risk of repeating ourselves file”… Brick and mortars are getting slammed by the ongoing economic woes. How are sites like eBay doing for sellers?

While we’ve covered the fact that online retailers seem to be picking up some of the slack generated by physical stores’ slump in sales, people who sell items on sites like eBay and Craigslist aren’t enjoying a similar upswing. Much of this is due to scale:

The problem for small retailers trying to sell merchandise more cheaply than volume discounters—such as Target (TGT) or Wal-Mart (WMT)—is that they don’t have the economics of scale on their side, says David Zahn, president of StartUpBuilder.com. “It is harder [for small e-tailers] to turn a profit, because the pressure is on the e-commerce businesses to absorb shipping costs as many established sites are doing,” he says. “For Amazon.com, as well as traditional retailers that have e-commerce sites, such as Staples.com and others, the costs are often absorbed for both shipping to the customer and also from the customer if the item is to be returned. What remains to be seen is if the gas crunch will lead to more online purchasing,” he says.

Definitely check out the whole article. I’ve never had any luck trying to market my products on eBay, and apparently that’s not going to change anytime soon. It should be quite the buyers market going forward, though.

Source: BusinessWeek