A personal shopping and same day delivery courier service from eBay might be facing serious troubles, according to anonymous sources,after reports surfaced speculating that the company might shut down their eBay Now program.
In 2012, eBay launched the same day delivery service to compete with other local delivery companies in large cities, but now the high costs and workforce issues might put a stop to eBay Now in the future.At the end of April, eBay fired its team of “valets” and began using third party courier services instead. Yet the service is still costing the company a lot in resources, and it may have lost some or all of its pricing deal with retail giant Best Buy, a lucrative source for the company’s program.
Although eBay announced plans to expand their eBay Now services to London back in September, the company then retracted the statement, saying that they only planned to focus on their current markets in San Francisco, San Jose, New York City, Chicago, and Dallas. This may have been an early indication of trouble with the program, before workers were let go in April.
A former eBay Now valet said of the program, “The service definitely wasn’t well-managed at all, and the respect for employees took a sudden turn for the worst after about a couple months of the service running,” according to tech news site VentureBeat. The former valet said the plan is “pretty popular and useful” around the holidays, but outside of that time, it doesn’t have enough consistent orders.
The business model itself may have caused trouble, as well: Deliveries cost the customer $5 and only took about an hour. In addition, eBay also had to pay their couriers hourly wages and covered the expenses for the couriers’ personal vehicles, regardless of the order amount.
If eBay Now ends, it could mean serious changes in the San Francisco market alone, as California has the highest number of courier services in the country at over 8,000.
“eBay is one of great American business success stories of the past 20 years and the potential exit from same day delivery would be a loss, however when you just got to have it right now, local courier services abound and offer fast, secure delivery at a great price,” says a senior manager at LA Courier Service in Los Angeles, California.
A spokesperson for eBay denied that eBay Now will be shutting down or downsizing any time soon, but when asked about long-term plans, the representative declined to comment. The spokesperson said that the company remains committed to local delivery services and “will continue to test and evaluate local capabilities that bring new services and solutions to our retail partners and seamlessly connect buyers and sellers through shipping, delivery, or in-store pick-up.”