So you're considering becoming an eBay seller. Perhaps you've sold a few things to declutter your house, and are thinking it seems to be a nice way to make a few bucks. Perhaps you'd like to work at home and be your own boss. Here's a few things to consider before taking the plunge.
First the bad news - it is extremely difficult to make a full replacement income on eBay. Yes, a number of people do it, but they succeed in one of two ways; they either put in work-weeks of eighty to a hundred hours, or they had ten to twenty thousand dollars to invest in inventory at start-up. EBay is very good at supplementing an insufficient income, for retirees and stay-at-home and home-schooling moms to bring in extra cash. But the effort involved in making enough sales to pay the mortgage and every other household expense is daunting. Consider carefully before quitting your day-job. Now the good news - it is very easy to add several hundred dollars a month to your family finances by becoming an eBay seller. It won't be effort-free; work is involved, but if you apply yourself, you will make money.
You must have the appropriate equipment. A computer with Internet connection is obvious. If you're currently getting online at the local library, you really must get a home computer - the hours you will need to be online aren't conducive to working from another site. You will also need either a digital camera, or a scanner, or preferably both. If you lack these, you can buy them quite cheaply on, you guessed it, eBay. Cameras that are two or three generations old can be bought for ten-fifteen dollars, and are completely sufficient for your eBay needs. A digital camera is needed to take pictures of the items you are selling. Items like books are more easily scanned, and if you are going to sell jewelry, scanning yields a much more detailed picture than cameras do.
You will also need auction-management software or service. While this isn't mandatory, the time you save using a service will be well worth the incremental cost. With an auction-manager, you can store hundreds of listings, queue them up to launch as far out as a month from now, keep track of inventory, shipping and feedback, and automate a lot of the emailing that goes into running a successful eBay business.
A definite Must-Have is a PayPal account. You really must accept payments via PayPal if you want to draw the bidders. In this instant-gratification society, most buyers won't even look at your auctions if they know that if they win, they have to sit down and write out a check and then remember to mail it, or worse, make a special trip to buy a money order. 80-90% of eBay buyers pay with PayPal - you cannot afford to ignore that many potential customers. Paypal accounts are quite secure, and you only have to give personal information to PayPal itself; all buyers need to know is your email address to send you money to pay for auctions won. The money in your PayPal account is instantly available to you and with the PayPal debit card; you can withdraw it as needed, or make purchases as with a credit card.
INVENTORY - ESTATE SALES OR WHOLESALE?
So what do you want to sell? The two major approaches to acquiring inventory are: 1) used stuff you find at thrifts, yardsales and auctions and 2) merchandise you purchase new from wholesalers. There are advantages and disadvantages to each approach.
Buying Used:
The biggest advantage to the used approach to inventory is that your profit per sale is potentially much greater. If you attend the large estate sales in your area, you can frequently fill up a car with merchandise (not all of it worthy of eBay sales) for $200-$300. "Box Lots" of miscellaneous items can go for five dollars and less, and you can often discover a true gem among the junk, the item that came in a two-dollar box-lot that you sell for fifty to a hundred dollars.
The main drawback to buying inventory this way is that you really have to know what you're doing, or you'll wind up with a trunk full of trash. You can buy a lot of 'old stuff' and then research it when you get it home; it's very time-intensive, but treasures can be found this way. Unfortunately, your house will quickly become cluttered with the worthless stuff you had to buy to get the stuff you really wanted. It's a good idea to make friends with your local consignment stores, and periodically take them a few boxes of the dross you had to sort through to find the gold you're selling online.
Some things for whatever reason just won't sell on eBay. Modern brass and silver-plate items will just not go. These are things that people might fall in love with in a shop, so keep them to take to your friends at the consignment store. Many things are seasonal that you wouldn't think should be. Lace tablecloths? List them in the spring; they never sell, or sell for too little, any other time of the year. List items several times, across different seasons, before you give up on the truly lovely things. Shopping for inventory at auctions can be a lot of fun, like a treasure-hunt, but be wary of bid-fever and don't pay more for something than you think you can sell it for.
Buying Wholesale:
You can find wholesalers easily on the Internet, but unfortunately, you should avoid them. Net wholesalers are either selling merchandise that was returned from retail stores because it didn't sell (so it's not going to sell on eBay either), or they're offering huge pallets of miscellaneous merchandise that you have to pay three thousand dollars for, sight unseen.
Your first item of business is to narrow down a category of goods you want to carry. Look on eBay and see what's selling in your area of interest; say, cosmetics. Don't be put off if there are already a number of PowerSellers selling the same thing you want to carry; do a search on 'completed auctions' in the category to get an idea whether or not a good percentage of their auctions end with sales. If so, there's probably room for one more seller in that market.
If there's nobody selling what you want to carry on eBay, you should be concerned - there's probably a reason for that. Some manufacturers don't allow their lines to be sold new at online auctions, and will have eBay halt auctions if some seller attempts it. For instance, Windstone Editions line of fantasy figures only authorizes retailers to sell their products in retail stores and in online stores associated with them. All the Windstone figures available on eBay are 'secondary' market, or used. Some cosmetics lines, such as MaryKay, also forbid sales by online auction. (There's also the possibility that you have found an untapped source of goods that no one else has thought of, but as a possibility, it's pretty slim.)
So how do you find the merchandise, now that you've decided on a product line? At your local retailer. Most retailers will not give you contact information for their wholesalers; it's considered company-proprietary information, and who can blame them? You're going to be their competition, after all. But you can go into a store and examine the box. There you will typically find the company name and if not an address or URL, at least a town and state name. With this information, it's a piece of cake to use your phone and call directory assistance; ask for the 'main number' of Amalgamated Cosmetics in Moosecreek, Minnesota and there you have it. Now you can call Amalgamated and ask them to send you a wholesale catalog.
To purchase directly from a manufacturer or distributor, you will need a 'resellers ID'. Your state will issue this; which department varies by state - try your state's department of taxation first. Most companies will not send you wholesale information unless you can give them a valid ID. As a reseller, you won't pay sales tax on the items you purchase for resale, so it's pretty important that you have one. Suppliers will have some minimum for a wholesale order, usually a hundred dollars. They may also have a higher minimum for an 'initial' order. For eBay purposes, buy a very few of a wide variety of things; you don't yet know what will sell the best, and you can always buy more. You can either take pictures of the products when you receive them, or scan the photos from the catalog itself; since the catalog photos were taken by a professional photographer and carefully lit, these are probably better than photos you could take yourself.
When you're just starting out, it's better to try a variety of lines to see which ones sell the best and which companies are the easiest to deal with (ship quickly, keep up their stock, and so on). Make auction listings using your management software for each unique item you buy. You can continually restock and reuse the same listings. Nothing sells every single time it is listed. If you are selling a quarter of your listings every week, that's fairly okay. Sell a third of your listings and you're doing pretty good - sell half and you're on your way to riches. Only drop an item from your inventory if it never or rarely sells. I've noticed that sometimes you have to be listing in a particular category for several weeks for the sales to start picking up, so don't throw in the towel if you haven't made a fortune in week one.
The disadvantage to buying wholesale to sell on eBay is that your profit per item is going to be much lower than with buying items used. If you purchase an item for five dollars wholesale, you can't expect to be able to sell it for much more than $9.95, even if it sells in retail stores for $14.95. If you list it for more, some other seller is going to undercut your price. The advantage of wholesale items is the time-saving benefit of being able to use the same listings over and over again. The bulk of the seller's time in selling used items is in researching and describing a single item they'll never be able to replace; the wholesale-seller will spend the bulk of their time packing and shipping items that only made them a few dollars profit each.
So which way to go? Wholesale or Estate Auctions?
This is an individual decision and depends on what kind of person you are. Some people are motivated by the thrill of the hunt; others find the prospect of another all-day auction and the attendant sore feet and at-home clutter demoralizing. Some might find the purchasing of new products sterile and boring, and others love the look and feel of a shiny new catalog. You're just starting out - try both initially and see which one makes work the most fun. The wonderful thing about selling on eBay is that it's a job that you can pick up when needed and put back in the closet when you're no longer strapped for cash, or a full-time job emerges, or you just need a vacation. But when your contract isn't renewed, or the kids need braces, there's always eBay, and the skills you've learned, to help you through.
