📉 Sellers Reported Sales Drop
Earlier this month, Poshmark introduced a new fee structure, reducing seller fees to 5.99% but adding a 5.99% “protection fee” for buyers. Orders were also subject to extra fees based on the order amount. Sellers soon reported a significant drop in sales, with one stating they went from making “12-15 sales” per week to under five. Shoppers appeared discouraged by the additional charges, leading to fewer completed transactions.
💬 CEO Apologizes for Disruption
On October 21, CEO Manish Chandra emailed sellers to address the backlash, expressing regret. “The outcome of the change did not meet our expectations,” he stated. He acknowledged that the adjustment “left sellers with less cash in their pockets—despite the seller fee reduction.” The apology highlighted Poshmark’s attempt to balance its marketplace but ultimately acknowledged that the changes had negatively impacted sellers.
🔄 Reverting to Original Fees
The company announced a return to the 20% seller fee structure, effective October 24. This shift comes after just three weeks of the new policy, which started on October 3. Poshmark also promised sellers a rebate to cover any losses on listings affected during the fee change period, specifically for items sold from October 24 to October 27. The move aims to restore trust with its user base.
📅 Not the First Reversal in Resale
Poshmark’s situation mirrors other platforms' struggles with fee adjustments. Earlier this year, Mercari faced backlash after eliminating seller fees and increasing costs for buyers, leading to a partial rollback. These incidents highlight the delicate balance needed in the resale marketplace, where both buyer and seller satisfaction is crucial. Poshmark's quick response aims to prevent long-term damage to its reputation and seller relationships.
Is balancing fees crucial for resale marketplaces?
