eBay is an answered prayer for many investors, buyers as well as sellers. It was founded on September 3, 1995 by Pierre Omidyar. It is an American multinational Internet consumer-consumer corporation, headquartered in San Jose, California.
It is now a multi-billion dollar business with operations in over thirty countries. The company manages eBay.com an online auction and shopping website where people and businesses buy and sell a broad variety of goods and services worldwide.
eBay generates revenue from various fees. As of November 2012, the U.S. based eBay.com took $0.10 to $2 as an insertion fee for a basic auction-style listing without any adornments and 10% of the total amount of the sale as a final value fee.
Under current U.S. Law, a state cannot require sellers located outside the state to collect sales tax, making deals more attractive to buyers. Most sellers that operate as a full-time business follow state tax regulations on their transactions. eBay however requires sellers to include the Value Added Tax element in their listing price and not as an add-on.
The company’s current business strategy includes increasing international trade. eBay has already expanded to over 24 countries including China and India. eBay failed in China due to competition from local rival Taobao.
eBay is a huge, publicly visible market, it has created a great deal of interest from economists who have used it to analyze many aspects of buying and selling behavior, auction formats e.t.c. and compare with previous theoretical and empirical findings.
Many people have shown interest in eBay from economists to computer information systems researchers. This means that eBay has even more potential to grow into the world’s greatest online market.