Poshmark on October 21, 2024, announced that it will return to its previous fees structure after a brief experimental change that resulted in decreased sales activity on the marketplace.
The social commerce marketplace had introduced the new fees structure on October 3, to attract more sellers on the platform and help them make more profits.
That new fees structure included a 5.99% fee for sellers, a 5.99% protection fee for buyers, and additional transaction fees ranging from $1 to $3 based on order value.
Poshmark will reinstate its original seller fee structure effective Thursday, October 24 which will be $2.95 flat for sales under $15 and 20% for sales over $15.
Also, the Buyer Protection Fee will no longer be charged from buyers. In addition, Poshmark is also ending the Posh Pass Beta program.
Moreover, to address losses incurred due to new fees structure, Poshmark will compensate sellers.
Poshmark sellers will get a rebate for the difference in seller fees on listings created or edited between October 3, 2024, and October 23, 2024, and items sold from October 24, 2024, to October 27, 2024.
In an email to sellers, Poshmark CEO Manish Chandra acknowledged the policy’s failure by saying:
“We leave our sellers with less cash in their pockets—despite the seller fee reduction.”
He also said that:
“The outcome of the change did not meet our expectations, and I sincerely apologize for the disruption and impact that this has had on you.”
The reversal of the new fees structure by Poshmark is seen as positive and encouraging by both buyers and sellers on the platform.
However, sellers are also wondering if buyers will still actively buy on the platform and if they will get sales like they used to get before the introduction of the new fees structure.
The reversal of the new Poshmark fees structure follows similar challenges faced by other reselling marketplaces.
Mercari also attempted to eliminate seller fees in March, replacing them with buyer service fees for returns. However, the decision was reversed within two months due to negative buyer feedback.
Recently, eBay also announced plans to introduce buyer fees in the UK market in 2025. However, it will be interesting to see how eBay will do it after seeing the failure of similar plans by Poshmark and Mercari.
