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Poshmark is undergoing a major fee structure shakeup.
The online resale platform is walking back fee changes announced on Oct. 2, after speculation of seller backlash from merchants that sell on its platform.
Poshmark is dropping the fee structure in which sellers had to pay an additional $1, $2, or $3 depending on the total order amount, after Poshmark CEO and Founder Manish Chandra admitted it led to a drop in sales.
“Over the past few weeks we have seen that shoppers spent less on purchases as they shifted their spending from orders to fees, leaving our sellers with less cash in their pockets—despite the seller fee reduction,” Chandra wrote in an email to sellers.
The company is also ditching its buyer protection fee, where shoppers had to pay $1, $2, or $3 based on the order price.
“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,” Chandra added.
The resale platform, founded in 2011, said the fee rollback will begin on Oct. 24, and Poshmark will return to its original 20% fee structure. That includes a 20% fee that sellers have to pay for sales over $15 and $2.95 for sales $15 and lower, the company said.
Poshmark said it will also offer a rebate for the difference in seller fees on listings created or edited during the fee change period and sold via “Buy Now,” from Oct. 24 until Oct. 27, if the new seller fee is higher. The rebate will be provided as redeemable credit in one lump sum by Dec. 6, the company said.
Two Poshmark sellers, The Posh Kings and Cassandra told Modern Retail that they both had seen a drop in sales during the period of fee change.
“We hope this decision reflects our commitment to listening and evolving based on your feedback,” Chandra added in his note to merchants.