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dtbaker Moderator says

The Buyer Services Blog Post should go some way to clarifying things, although to clear up any confusion, I’ll run through a typical example:

Let’s begin with a Theme, available for $58:

1) Buyer Commits to purchase, pays $58
2) Envato immediately takes a 20% buyer fee ($11.60), so $46.40 is left over
3) This is now shared between Envato and you (the Author)

Previously you’d earn a “commission” that went on a sliding scale from 50%-70% depending on how much you sold. Now we hand you everything that’s left over after the buyer fee, then you pay a small “platform fee” to Envato. That platform fee is on a sliding scale of 37.5%-12.5% . The more you sell, the smaller fee you pay Envato.

So to clarify, you’re elite so your commission was previously 70% . We used to simply give you 70% of the total transaction cost and say “There you go, that’s yours to keep” . Now we say “Here’s everything that’s left over after the buyer fee, and you need to pay us 12.5% of that, then the rest of that is yours” .

So, how does this stack up in numbers?

Previously:

1) $58 sale
2) $58×70% commission = $40.60 (your net earnings)
3) Envato keeps whatever is left over

Now:

1) $58 sale
2) Envato immediately takes a 20% buyer fee ($11.60), so $46.40 is left over
3) You pay 12.5% platform fee to Envato ($46.40 * 12.5% = $5.80)
4) $46.40 – $5.80 = $40.60 (your net earnings)
4) Envato keeps the buyer fee + platform fee

As you can see, in the above case the end earnings don’t change on a $58 sale. Just that the money moves around a bit differently. Any changes to Author earnings will be minimal, and will mostly affect non-exclusive Authors who’ll earn 3% more than before, or those who accounted for receiving a cut of the handling fee (formerly “surcharge”) that Authors will no longer benefit from.

I suppose some of the confusion comes down to the fact we’re all used to associating high percentages with higher earnings, whereas now a low percentage yields higher earnings :grin:

Christian

^ this post needs more attention ! :) wack it up on the blog / somewhere useful. explains it perfectly.

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QuanticaLabs says

As I said earlier “as long as my fee is not changed ” I don’t have a reason to read anything else.

changes to Author earnings will be minimal, and will mostly affect non-exclusive Authors who’ll earn 3% more than before, or those who accounted for receiving a cut of the handling fee (formerly “surcharge”) that Authors will no longer benefit from.[...]
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SilentGraphics says

Can you say Istock?I hate these huge “new rules”.Nobody understand nothing.Like always..when are money in the game is bound to be “good players” also

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doru says

while against the locking threads I have to agree that this should go to the main thread where Collis and staff can see the posts. better

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UJ-pro says

In the end I still don’t understand what this message means!!!!!!

37.5% of the Item Price is the author fee we’re currently charging you.

I’m getting 50% what is with thi 37.5% ?

37.5% is the envato commision and the 12.5% procent is the buyer commision or what ?

Right now I understand that I don’t understand and I shouldn’t understand !!! =)))

No, it’s not that difficult. One day you’ll get it. :)

After the buyers-fee of 20% is taken away the left money now is the ‘new’ 100% where you pay off 37.5% authors-fee to envato when you start selling as an exclusive author. (which will effect the same earnings like your 50% commission rate before) After selling more the author-fee decreases down to the limit of 12.5% (which will effect the same earnings like the 70% commission rate before)

MhW described it quite clearly. ;)

EDIT: Before it was more like profitsharing where you got 50-70% of the price. (so it goes up from time to time) Now it’s a fee (charge) you pay of the money which is left after the buyer payed his fee for the item. (so it goes down from time to time)

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erwin_schro says

... 3) You pay 12.5% platform fee to Envato ($46.40 – 12.5% = $5.80)
...

Just want to correct it a little bit

3) You pay 12.5% platform fee to Envato ($46.40 * 12.5% = $5.80)

:)

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nCrafts says

People are so confused by the new fee rules, they are forgetting the anger over the mandatory-support issue. Well played, Envato ;)

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MhW Envato team says


... 3) You pay 12.5% platform fee to Envato ($46.40 – 12.5% = $5.80)
...

Just want to correct it a little bit

3) You pay 12.5% platform fee to Envato ($46.40 * 12.5% = $5.80)

:)

Well spotted! I noticed that a few hours ago, but got busy and forgot to go back and update it. I’ll attribute blame for that one to the keyboard layout, and – being next to * on the number pad :grin:

Thanks for the heads up! :grin:

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Creattive says

Tax is paid on income, not revenue. So this likely has nothing to do with taxes.

The total turnover defines what taxation rules will apply to you, at least in some countries. Don’t know how it looks like in Australia, though.

Also, many taxes apply to everything you sell, so yes, some taxes are on turnover and not on income.

Edit/ did a bit of google search. In Australia, the tax is called “goods and services tax” (GST), and is applied to all deliveries and services. it is 10%. This tax applies to everything they sell, so if they pretend to only sell 30% of what they actually do, then they win millions.

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Anps says

Now i have a really important question which can impact on every author here that lives in a country that has similar laws as our (which I think most of eu has)

If we how Creattive explains now sell directly to buyers, how does this effect on or laws? Meaning we have to issue an invoice to every buyer, because if we can issue refunds how can this be achieved?

If that is the case we for example can shut down our services cos we have to charge each and every customer differently, depending on were they are from, since we are obligated by VAT.

Something very scary and smelly is brewing up hear? It looks like envato wants to re-leave themselves from any responsibility towards buyers and eventually put everything into our hands?

Please can somebody elaborate on this? It is really disturbing me.

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