The Best Ways to Make Money on eBay
Why is starting an eBay business so appealing? Because it’s easy, fun and can be done from the comfort of your own home. But what if you want to do more than just sell a few items and actually make money on eBay?
How do you turn your selling on eBay foray into a successful eBay business? That’s what Adelia Linecker wanted to know when she interviewed me. The following interview transcript presents what I think are the keys to successful eBay selling. (Adelia Linecker’s article, “Kicking Up Online Profits”, appeared in Investor’s Business Daily, 9/28/2006).
1. Think And Choose Wisely
Anyone who's trolled around on eBay knows that they can find everything from blenders to toilet paper. But peddling mundane household products isn't necessarily a winning strategy. The best eBay businesses sell unusual, hard-to-find items at a discount, says Marsha Collier, author of 'eBay for Dummies.' By sticking to this approach, you'll cut down on the competition and the ensuing price wars that could eat into your profits.
Fortunately, you don't need to know anything about antiques and collectibles to fulfill Collier's requirements. One idea is to look for items unique to your region and sell them at a discount. If she lived in Manhattan, for example, Collier says she would regularly shop at Century 21, a famous designer discount store, and then resells the hard-to-find name-brand clothing at a markup on eBay.
Anyone who's trolled around on eBay knows that they can find everything from blenders to toilet paper. But peddling mundane household products isn't necessarily a winning strategy. The best eBay businesses sell unusual, hard-to-find items at a discount, says Marsha Collier, author of 'eBay for Dummies.' By sticking to this approach, you'll cut down on the competition and the ensuing price wars that could eat into your profits.
Fortunately, you don't need to know anything about antiques and collectibles to fulfill Collier's requirements. One idea is to look for items unique to your region and sell them at a discount. If she lived in Manhattan, for example, Collier says she would regularly shop at Century 21, a famous designer discount store, and then resells the hard-to-find name-brand clothing at a markup on eBay.
2. Make Sure You Keep Your Costs Low
Nothing eats into your profits faster than high overhead expenses. That's why experts agree that you should start off your eBay business by hawking stuff that you already own. Once you've depleted all of the goodies in your basement, move onto your neighbor's. Take out an ad in a local paper and offer to sell other people's possessions on consignment, says Cliff Ennico, author of 'The eBay Seller's Tax and Legal Answer Book' and an instructor at eBay University, which offers instructional DVDs and classes on selling on eBay. Other than your time, your costs will be virtually zero. And, according to Ennico, your efforts and expertise are worth anywhere from a 30% to 50% cut of the sale.
Once you're ready to graduate to the next level and start your own eBay business -- even if it's a small one -- Collier recommends getting a sales tax number or business license (if you live in a state with no sales tax). This will allow you to contact manufacturers directly and buy items at wholesale. Click here for more advice on setting up a small business.
Nothing eats into your profits faster than high overhead expenses. That's why experts agree that you should start off your eBay business by hawking stuff that you already own. Once you've depleted all of the goodies in your basement, move onto your neighbor's. Take out an ad in a local paper and offer to sell other people's possessions on consignment, says Cliff Ennico, author of 'The eBay Seller's Tax and Legal Answer Book' and an instructor at eBay University, which offers instructional DVDs and classes on selling on eBay. Other than your time, your costs will be virtually zero. And, according to Ennico, your efforts and expertise are worth anywhere from a 30% to 50% cut of the sale.
Once you're ready to graduate to the next level and start your own eBay business -- even if it's a small one -- Collier recommends getting a sales tax number or business license (if you live in a state with no sales tax). This will allow you to contact manufacturers directly and buy items at wholesale. Click here for more advice on setting up a small business.
3. Perfect Your Title
If you do nothing else, make sure the title on your listing gets straight to the point. "It's the most important piece of real estate on the Web site," says Jim Griffith, a dean at eBay University and author of the 'Official eBay Bible.' A common and damaging mistake even experienced users make is thinking that their title should read like a sale pitch and include empty descriptors such as "rare" and "beautiful." Instead, just list the facts, including a brand name or model number. This strategy will help serious buyers find your item more readily since the search engine scrolls through titles when trying to match key words, says Griffith. As for the marketing, leave "one of a kind!" for the description inside your listing.
If you do nothing else, make sure the title on your listing gets straight to the point. "It's the most important piece of real estate on the Web site," says Jim Griffith, a dean at eBay University and author of the 'Official eBay Bible.' A common and damaging mistake even experienced users make is thinking that their title should read like a sale pitch and include empty descriptors such as "rare" and "beautiful." Instead, just list the facts, including a brand name or model number. This strategy will help serious buyers find your item more readily since the search engine scrolls through titles when trying to match key words, says Griffith. As for the marketing, leave "one of a kind!" for the description inside your listing.
4. Use Content, update and be consistent.
Remember that you are selling products and services and so not just posting an advertisement on your website or other people’s websites. Use content {information} to enhance your website. And please always make sure that all your links are working and also make sure you keep everything consistent.
5. Build Genuine Trust
Gaining the trust of the eBay community is one of the biggest hurdles new sellers face. It's critical for you to generate a high positive feedback score or else other users won't even touch your auction. The score tells potential bidders that you don't falsely advertise or exaggerate when describing your merchandise and that you ship your items quickly. Your goal is to eventually get at least 100 positive responses from other users, says Ennico. (Read our story to learn how to avoid hurting your score.)
Even if you've never sold anything on eBay, you can still work toward building up your reputation. Your score is based on the feedback you receive as both a buyer and a seller. So before listing your first item, buy a handful of inexpensive things just to get the feedback, says Collier. Then, once you start running your own auctions, make sure every person you interact with has a good experience. And finally, be sure you accept PayPal for payments since it offers buyers some purchase protection if a deal goes awry.
Gaining the trust of the eBay community is one of the biggest hurdles new sellers face. It's critical for you to generate a high positive feedback score or else other users won't even touch your auction. The score tells potential bidders that you don't falsely advertise or exaggerate when describing your merchandise and that you ship your items quickly. Your goal is to eventually get at least 100 positive responses from other users, says Ennico. (Read our story to learn how to avoid hurting your score.)
Even if you've never sold anything on eBay, you can still work toward building up your reputation. Your score is based on the feedback you receive as both a buyer and a seller. So before listing your first item, buy a handful of inexpensive things just to get the feedback, says Collier. Then, once you start running your own auctions, make sure every person you interact with has a good experience. And finally, be sure you accept PayPal for payments since it offers buyers some purchase protection if a deal goes awry.
6. Use Search Engines to your own advantage
About 70% of the internet visitors come from search engines. So you have to develop the skill that will constantly keep you at the top of search engines like Google, Yahoo, MSN, Ask.COM, etc.
7. Grab Eyeballs
EBay is a numbers game. The more people who bid on your item, the higher the price it sells for. That means boosting the number of eyeballs that see your listing is crucial. If you're selling a high-ticket item, you should consider spending an additional $19.95 to "feature" it, says eBay University's Griffith. This ensures that your listing gets some prime real estate on the first page of a given category. That way you not only catch people searching key words, but also those folks who like to scroll through category pages.
"Once someone is looking at one of your listings, you can then promote other [listings]," says Griffith. EBay allows sellers to directly link to 12 of your other listings. Better yet, a serious seller could also direct buyers to his eBay Store, where one can customize a virtual "store front" and list his entire inventory. An eBay store is one of the best ways to develop a loyal customer base since users can bookmark your page and hopefully return often to see what you're selling one week to another, says Griffith. (Click here for more information on fees that eBay charges store owners.)
EBay is a numbers game. The more people who bid on your item, the higher the price it sells for. That means boosting the number of eyeballs that see your listing is crucial. If you're selling a high-ticket item, you should consider spending an additional $19.95 to "feature" it, says eBay University's Griffith. This ensures that your listing gets some prime real estate on the first page of a given category. That way you not only catch people searching key words, but also those folks who like to scroll through category pages.
"Once someone is looking at one of your listings, you can then promote other [listings]," says Griffith. EBay allows sellers to directly link to 12 of your other listings. Better yet, a serious seller could also direct buyers to his eBay Store, where one can customize a virtual "store front" and list his entire inventory. An eBay store is one of the best ways to develop a loyal customer base since users can bookmark your page and hopefully return often to see what you're selling one week to another, says Griffith. (Click here for more information on fees that eBay charges store owners.)
Some Questions And Answers Asked Recently About EBay
Question: what can research eBay before listing a product or launching a store reveal?
Answer: Researching eBay before listing a product or launching a store will answer three questions that are vital if you actually want to make money on eBay:
- Is there a market for this?
- How much is this item worth?
- How much competition is there?
You need to know the answer to at least the second two of these questions before you bother to list something on eBay.
Question: How important is it to the success of your eBay business that your products are easy and not too expensive to ship? What else should you know about shipping before starting an eBay business?
Answer: Critically important. Take a foolish example. Suppose you want to sell rocks on eBay. It cost $86 to ship each rock to a Canadian address and more to send one anywhere else. However, no one seems to want to pay more than $5.00 for a rock. You can see what would happen to your business if you were dumb enough to sell any rocks under these conditions.
You need to know all the details about shipping before you sell anything on eBay.
Question: What must you include in the description of your products to improve chances they will sell?
Answer: When you’re selling on eBay, the description of your products is your "Unique Selling Proposition". It's one of your big chances to get the viewer to want your product. (The other is the picture of the item.) So if you don't invest time in developing a mouth-watering description of your product, you're throwing away half your chance to sell it.
So you need to include details (such as colour, size, weight etc.) as well as features that set your product apart from other such products and make it desirable. For instance, you don't just sell "teddy bears" on eBay. You sell "handcrafted, one-of-a-kind teddy bears". The trick is to think like a purchaser. What would you want to know about the item? What would make you buy it?
Question: Some people are eager to make "a ton of money" with an eBay business. How realistic is this? What should your focus really be at first so that you can eventually make a decent return?
Answer: Making a "ton of money" is not a realistic expectation - but if you have the right products, do things right and are prepared to work at the business, making a good living is.
Because of the way that eBay works, your focus at first should be establishing yourself as a proven, trusted seller and building up the positive feedback you need to do this. If you want to run a successful eBay business, you have to take the time to do this.
Question: eBay sellers can sometimes come across as unreliable, or at the very least obscure. What can you do to make buyers feel you are a serious business?
Answer: Run your eBay business as a proper business from the get go. That means going through the steps of setting up a real business, charging appropriate taxes, following standard business practices and investing in things such as professional looking packaging.
Question: Any books, Web sites or other reliable sources you can recommend for those who want to start an eBay business?
Answer: eBay itself is a wonderful resource for anyone wanting to become an eBay seller or increase their eBay sales success. Besides the resources on their site, they're also offering eBay courses/seminars in various cities around the country.
Adelia Cellini Linecker is a Los Angeles-based business writer. Her biweekly column appears in Investor’s Business Daily. She also contributes to Variety and is author of "What Color Is Your Piggy Bank? Entrepreneurial Ideas for Self-Starting Kids."
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