Oct 17, 2021

How OfferUp Makes Money

Offering used goods for sale is the goal of OfferUp, a mobile-first C2C marketplace. This platform makes money from a minimum fee of $1.99 per sale, which is 12.9% of the price of the sale. It also makes money from promoted listings for sellers and from Verified Dealer Program which allows auto dealerships to list cars.


With OfferUp, C2C marketplaces such as Craigslist, Facebook Marketplace, and eBay compete with mobile-first services. OfferUp allows users to buy and sell a variety of used goods through a mobile app. The location of your location determines what products are displayed in a feed for buyers. Thus, face-to-face interaction between the two parties is encouraged and a sense of community is fostered. Once an item is uploaded for sale, it will be listed immediately for sale. When the seller receives a prospective buyer’s highest bid, he/she can sort the inquiries according to how high it is and arrange for a meeting. Immediately following the transfer of ownership of the product, the buyer has 48 hours to inspect it and initiate the purchase

OfferUp mission and vision

Company officials highlight the vision of the company as “empowering people to connect and prosper” and its mission as “reimagining the model for local, peer-to-peer commerce … on a mission to become the most trusted and convenient local marketplace for people to buy and sell.”

OfferUp revenue generation

As an offerup seller, you were free of charge for the first five years of OfferUp. The decision to not participate in this study was based on several factors. Company founders initially wished to compete with Craigslist and Facebook Marketplace — who are free platforms for sellers to list. In addition to competing with Craigslist and Facebook Marketplace, company founders also wanted to attract buyers to Offerup, which could only happen once there was sufficient supply to inspire buyers. Earlier this year, OfferUp began charging sellers for their service. Let’s dig deeper into the business model for OfferUp now. Where do they get their money from?

Seller fees

Sellers selling items that require shipping can collect a minimum fee of $1.99 or 12.9% of the sales price from OfferUp. OfferUp partners with one of the largest transportation companies in the nation. The product is shipped through the U.S. Postal Service, but also charges a service or shipping fee based on where it is being sent. It’s important to remember that the item being offered must meet a set of strict criteria in order Since the company prefers to conduct the transaction in person, the transaction needs to be carried out

Promoted listings

Sellers who use Offerup have the choice of promoting their listings with Promote and Promote Plus functionality. The seller can have their product appear in the top 50 listings in their area by using these features. OfferingUp’s “Bump” service is for sellers who want to reach the top right away. For sellers who want a longer-term option, Promote Plus is available for $19.99 a month.

Verified Dealer Program

Additionally, OfferUp has taken advantage of the increase in used car sales by creating the OfferUp Verified Dealer Program which allows dealerships to sell their cars on the platform with AI-powered top lead indicators, automatic DMS importation, and a click-to-call feature. Car dealerships can determine how much they will pay for this service based on their size and the number of features they want to use.

Key takeaways:

An online marketplace, OfferUp provides a chance for face-to-face interactions to strengthen a sense of community among users. The platform began charging sellers for listing their products after it reached critical mass. OfferingUp takes a percentage of the sale price in addition to a small shipping fee for items that need to be shipped. It is also possible for sellers to pay to make their listings more visible to potential As well as providing used car dealerships with products, OfferUp generates profits through this service. Using the Verified Dealer Program, these dealerships have access to a range of tools that make it easier to sell cars online.


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