‘Buyers are going to leave’: Poshmark sellers are irate about the new fee structure

The new tiered structure is presented as a way to lower fees for the sellers but also results in a greater variety of fees. Under the previous Poshmark system, sellers paid a 20% fee per item sold. Now, Poshmark is lowering that to 5.99%. In addition, Poshmark is implementing a “buyer protection fee” of 5.99%. What’s more, buyers and sellers must each pay an additional $1, $2 or $3 depending on if the item sold is under $15, between $15 and $50 or more than $50. On top of this, buyers will need to pay shipping costs, as they did before, which start at $7.97.

The Posh Kings have been active on Poshmark since 2014 and have more than 46,000 active listings. Anthony and Schwibner are avid proponents of the platform and have made thousands of dollars on Poshmark. And yet, “This is the most drastic update announcement we’ve seen to date,” Anthony said. He believes buyers will abandon their carts at checkout when they see the full amount they owe, sending his and other sellers’ sales plunging. “A lot of people feel deceived,” Anthony added.

In a blog post, Poshmark announced that it was getting rid of its old fee structure, something that Mercari, Depop and eBay U.K. have all done in recent months to stay competitive.

In a statement to Modern Retail, a Poshmark spokesperson said that the platform worked on the new fee structure for more than a year. “We implemented this change in direct response to ongoing seller feedback, the evolving e-commerce landscape and our commitment to accelerating growth for our community. The predominant feedback we received was a strong desire for lower selling and shipping fees,” they said.

The spokesperson added, “A buyer fee, common practice among many leading online marketplaces, was introduced to provide Poshmark customers peace of mind, ensure buyer safety and support continued improvements across the shopping experience.”

Poshmark initially wrote in its blog post that it changed the fee system to “simplify selling and buying, ensuring our community has the best experience.” However, as of Friday morning, the language was updated to: “Our goal is to offer lower selling fees while still providing a full suite of tools and services at no additional cost to our sellers.”

When asked about the change in wording, a Poshmark spokesperson told Modern Retail, “We acknowledge that our initial announcement language was refined to provide further clarification based on initial community response.” In its blog post, Poshmark also said the changes will help sellers to “earn more with every sale.” 

Many sellers, though, told Modern Retail they are angry about the new structure, particularly the “buyer protection fee,” which they say places a burden on buyers and may drive them away from the platform. Some sellers worry they’ll be forced to list items for cheaper to cut down on how much buyers have to pay. Others are looking into ditching Poshmark for platforms that have lower fees, including eBay or Whatnot.

Anthony pointed out that the new fee rates will apply to the total order, “so they’re [Poshmark] actually adding the ‘buyer protection fees’ on top of the taxes and shipping.”

“I think it’s a terrible idea to charge your buyers a fee to buy,” Riley, a Poshmark seller since 2015, told Modern Retail. “I would almost rather take on even more fees as a seller than have the buyers pay a fee… Poshmark is calling this a ‘buyer protection fee,’ yet they’re not offering anything new in this fee. You’re just paying for it now.”

“I’m telling you right now, the ‘protection fee’ is going to destroy Poshmark because buyers are going to leave,” one seller wrote on Reddit. “Sure, this new policy benefits sellers in the short term, because they make more money, but let me ask you, how will they make money if they sell less because buyers aren’t buying as much due to the new fees?”

The Poshmark spokesperson noted that, unlike many marketplaces, Poshmark does not have payment processing fees. “Our fee structure remains clear, simple and transparent, consistent with our commitment to our sellers.” They also said that Poshmark is testing a Posh Pass beta program that “offers a shipping rate of $5.95 for our Posh Ambassadors through December 31, 2024.”

As a hypothetical, Modern Retail calculated that under the new policy, a shirt that is listed for $20 would now cost more than $31, not including state sales tax, when taking into account all of these fees. Some of these fees — like shipping fees that start at $7.97 — are ones that buyers paid even before this new policy was implemented.

But, the fear for sellers is that buyers will see that t-shirt listed for $20 and balk when it comes time to check out, because the price at checkout has now ballooned to more than $31.

It may be difficult for some cash-strapped shoppers to hand over that extra money. While shoppers choose to buy items secondhand for various reasons — including concerns about the environment — many are drawn to thrifting because it tends to be cheaper.

Now, some buyers are asking sellers to lower prices under the new policy because of the extra fees. “I’ve received two offers today and both are super lowball,” another seller wrote on Reddit. “One buyer bundled [items together] and said that I should take into consideration the new fees she has to pay. I already have very competitive pricing on items in my closet. This sucks.”

One seller who uses Poshmark to clean out her closet told Modern Retail that the new system “completely changes the game for buyers and sellers.”

“While this might not necessarily have an impact on [people who can afford] a high-priced sweater, it will completely shift how people are shopping for items under $50, which is what I have found sells the fastest,” the seller said.

With these new rules in place, some Poshmark sellers are contemplating leaving Poshmark or turning to other platforms that don’t require buyers to pay extra fees. “I already buy and sell on other platforms and am grateful that I [have] been,” Anna, a Poshmark seller since 2018, told Modern Retail.

“I am already established elsewhere, and that is going to save me,” said Anna, who also lists items on Jamble and Whatnot. “Otherwise, I fear my business would potentially come to a halt.”

Over the last couple of years, The Posh Kings have increasingly moved toward live selling on Poshmark over static listings. The new fees are especially concerning for live sales sessions, Anthony said. “That’s because the buyers don’t know what they’re paying until after the show ends and can cancel the purchase after seeing the total fees added,” he explained.

As such, Anthony and Schwibner are already moving to “diversify away” from Poshmark by ramping up their existing eBay store and doing live selling on Whatnot. 

“The other platforms aren’t doing this,” Anthony said. “So some of the die-hard Poshmark sellers are realizing they need to diversify because they know many of their customers aren’t going to pay those fees.” 

News of the fee change also came as a surprise to many sellers that The Posh Kings advise on how to build their businesses on Poshmark.

“We’re in Q4. This is the most important time for our business,” Schwibner said. “It feels like they [Poshmark] did this in the middle of the night. Typically, these rollouts are announced way in advance.”