The
Secret to Real Ebay Success
Copyright © 2005 Author
Q.
I hear so much about people who started selling on eBay and
eventually turned it into their full time business. Is it really
possible to build a profitable business just selling junk on eBay? --
Alex K.
ANSWER:
If Fred Sanford were alive today, Alex, I’m sure
he’d be earning his ripple money by selling quality junk on
eBay. While it’s also true that one man’s junk is
another man’s treasure (I have a garage full of treasure to
prove this point), your chances of building a profitable business
selling “junk” on eBay (or anywhere else, for that
matter) are slim to none. While there is a lot of junk/treasure for
sale on eBay, it is typically sold by individuals who have “I
break for yardsales!” bumper stickers on their cars and not
serious business people.
For serious entrepreneurs, however, selling on eBay can be a good way
to start a new business if you are willing to put in the time and
energy required to make the business a success. eBay is also a good
option for existing businesses to expand their reach by selling online.
Everyone from small used car dealers to giant companies like Dell
Computers have discovered that eBay is an excellent place to hawk their
wares simply due to the huge number of folks who visit the eBay site on
a daily basis. Nowhere else on earth will you find such a large pool of
potential customers.
Consider these numbers:
There are nearly 69 million eBay users who spend $59 million every day.
Most eBay sellers are home-based businesses that sell everything from
porcelain dolls to locks of Elvis’ hair to $100,000 Mercedes
convertibles to $5 million dollar vacation homes.
Every minute of every day more than 150 new items are listed for sale,
more than 500 bids are placed, and seven new people register to shop on
eBay.
At any given moment, eBay is conducting some 12 million auctions,
divided into about 18,000 different categories
About two million new items are offered for sale every day, and 62
million registered users scour the site to find them.
One company is grossing more than $5 million dollars a year selling
brand new pool tables on eBay. Their eBay store is so profitable that
they have closed their retail location and now sell solely online.
That’s right, $5 million dollars from the sale of pool
tables: proof that you can sell just about anything on eBay if you know
how to do it.
Be aware, however, that eBay is no magic bullet. As any eBay Power
Seller (a seller who sells a minimum of $10,000 in goods per month)
will tell you, building a profitable eBay business takes hard work and
requires long hours, and often the financial rewards do not make it
worth the effort spent.
When it comes down to the mechanics of it all, running an eBay business
is no different than running a brick and mortar business. You still
have the same considerations regarding product selection, inventory
purchasing, product pricing, inventory management, order processing,
fulfillment, customer service, etc.
You must also consider the legal and accounting aspects of the
business. Just because you’re selling online does not mean
that Uncle Sam won’t expect his piece of the pie. Revenue
generated by an eBay business is just as reportable and taxable as
revenue generated from a brick and mortar store. And if you sell to
customers within your state you may also be responsible for collecting
city, county or state sales tax.
One of the biggest obstacles to building a successful eBay business may
be the stiffness of the competition. Many sellers sell identical items
and the price wars often get ugly, but that’s to be expected
in a free market place, which is exactly what eBay is.
You may be the only store in town that’s selling that one of
a kind, custom made just for you, broke the mold after they made it,
Dale Earnhart Memorial Bobble Head Action Figure (Earnhart fans would
string me up if I called it a Doll), but do a quick search on eBay and
you’ll probably find a hundred others just like it.
So, can you build a profitable business selling on eBay? Certainly,
thousands of people have done it and so can you. Here are a few tips to
help get you started.
Sell Quality Products
Don’t sell junk! Leave the knick-knacks and fake leather
jackets to the less informed. You should offer only quality products at
a fair price.
Research The Competition
Once you have your product in mind, don’t invest a dime on
inventory until you have spent some time on eBay to see what the
competition is doing. If you want to sell motorcycle helmets, for
example, you should look at current auctions to see how many others are
selling similar helmets and what prices they are charging. This step is
vital since you may discover that you can’t compete with
current sellers on price or there is simply no market for what you have
to offer.
Start Slowly
Many people believe that the more items they have for sale on eBay the
better. They will invest thousands in inventory and spent hundreds on
listing fees (yes, eBay charges you to list items for sale and collects
a final fee if the item sells). Those are the folks that usually end up
with ten thousand Ginsu knives forever in their garage.
Test, Test, Test
A fair portion of eBay auctions result in no sales, so it’s
best to test the waters before jumping in with both feet. List a few
items and see how they sell. If an item doesn’t sell, list it
at least twice more. Some items might not sell the first time, but may
the second or third, then sell steadily from then on. If an item gets
no bids the first time, consider adjusting your price or your terms. If
an item sells well, keep it in stock and then experiment with another
item.
Do Your Homework
eBay is too broad a subject to be covered fully here, but there are a
multitude of books available that can help you start an eBay business.
In fact, I bet you’ll find most of them for sale at this very
moment at eBay.
What’s my bid…
Small Business Q&A is written by veteran entrepreneur and
syndicated columnist, Tim Knox. Tim's latest books include "Small
Business Success Secrets" and "The 30 Day Blueprint For Success!"
Related Links: http://www.smallbusinessqa.com
http://www.dropshipwholesale.net
To learn more about selling on Ebay, take a look
at The Silent Sales
Machine hiding on Ebay
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