Not just eBay, this happens in the Amazon marketplace also. It’s a HUGE problem for small retailers like me. A couple months ago I was searching for one of my products (that I get from a distributor) to check competitor pricing. I found the item being sold on Amazon, by the **manufacturer, **for below the wholesale price. I complained to the distributor who mealy-mouthed something about it likely being stolen merchandise (what, the manufacturer steals his own stuff?). So I was just like fuck you very much and removed it from my shop.
It is well known that some Chinese ebay sellers wrongly state that the item is in the Uk. It is in fact based in Gibraltar. Postage from Gibraltar is cheap but quite quick. I think the sellervalso saves on income tax by being based in Gibraltar. I dont complain about the small misleading bit in the description as the product is fine and cheap. There are others who have their products based in China but as delivery times can be a week to 10 days that too is acceptable.
These people could be selling a wide range of items cheaply for low profit and depending on volume. And/or they could be using “loss leaders” to gain confidence of buyers who will subsequently go for more expensive items (whether or not those items are worth the price).
I see that you note that it was free S&H, but I’ve seen a large number of ludicrously low priced items that have an equally ludicrously high S&H cost. I once bought a heavy box of poker chips for $1 and paid $20 shipping and handling.
Is it though? Just because the seller is in the UK doesn’t mean it’s already inside the UK in the hands of the seller. A lot of the dealers for budget Chinese stuff have drop ship services. Their stuff shows up on ebay for sale from someone who’s basically just another layer of middleman.
They could also just be feedback stuffing. 1000 pounds to get 1000 positive feedback doesn’t seem that expensive. Do they sell anything higher-margin? If so, if they win a few sales over somebody with less feedback, it could just be a marketing expense for them.
In the past, I worked with a supplier that did promotion fulfillment (e.g.: mailing out the toy you received for sending in 3 box-tops etc), but company’s main business was ownership of several mail-order catalogues and they made LOTS of money at them. (At the time they were transitioning to online).
He told me that basically consumers were pretty “unsophisticated” when it came to ordering out of catalogues and online. People want to believe they are getting a good deal on things so they do not mentally include the shipping and handling fee when they think of what they “pay”. As he said: Imagine walking into Walmart seeing a low price on the shelf and then when you get to the cash they tack on and addition $7 charge for their employees to “handle” the product.
They way it worked was they would put a very low price in a catalogue / website to attract people but then 95% of the profit they made was on “shipping and handling” fees. In most cases (for his items anyway) he said when you included the S&H fees, they were the same or more expensive than retail.
When they fulfill orders, it was all about controlling costs by being efficient. They wait until they have a minimum order quantity (XX units) to make it worth their while to pack & ship. Once they had that many (maybe in “6 to 8 weeks”) they would start up the conveyor and fire all the units into boxes and process them in a couple minutes.
I learned from him to always compare bottom-line acquisition prices for anything I order online if I can also buy it at retail.
Last point to the OP: in Canada (and the US) we have “dollar stores”, great place for cheap Chinese junk like this. I’d have recommended one of them first, at least you can make sure it works before you buy. Most here will accept exchanges if the item breaks within 30 days. Also, no chance of your credit card falling into the hands of some anonymous Chinese company. My other word of caution would be: does the watch come with a battery? I was looking online for a watch for my son last Xmas and I noticed in the small print that several of them did not include a battery with the watch (to my surprise). That said, Walmart (in Canada at least) does this too, many of the watches they sell don’t include a battery anymore. Somewhat deceptive.
Decades pre-internet I recall a flail in the US about shipping charges on catalog merchandise.
IIRC “Shipping and handling” was born after an FTC regulation requiring that “shipping” charges closely match the seller’s true cost for 3rd party transport of the goods. I.e. USPS or UPS fees. They’re under no obligation to disclose that a $12.50 “shipping and handling” charge is really $0.50 for a postage stamp and $12.00 for the heck of it.
I got a lot of (completely not relevant) hits off a search on Amazon this am. I clicked on sort by ascending price and was amazed by the number of 1 cent items (plus shipping) that was on the first few pages.
What about sales tax here? Amazon is required to collect sales tax for their sales. But these were affiliate sellers. Few of those collect sales tax. (No presence in state.) But some should.
Is anybody watching for the aforesaid tax fraud at Amazon for this?