Thursday, May 29, 2008

How I Profit On eBay

I've been selling items on eBay for about a year, slowly building a business.

When I started out, I thought price was everything.. and was looking for those "miracle" sources online... well they don't exist. Perhaps at tradeshows and through trade magazines, but I haven't gone through that yet.

The fact of the matter is, if you are drop shipping or buying in light bulk wholesale then your profit margin will be small.. but it is possible to make a profit -- in the upsell. People will pay a premium and give you an ok margin (considering your risk is nill with dropshipping) in the upsell. You need to be selling products that are either little known, or creating unique product bundles. I don't worry about what or other sites sell my products for.. if your customer was looking to buy from then they would be on Amazon! There's no reason to care just because someone was too lazy to look around for the best deal.

That being said, I never sell at a loss on eBay, and most of all I try to never undercut the competition. I do occasionally have low bid auctions, but I set my buy it now price at a premium to other sellers, and I usually get it.

You simply have to list, test, and eliminate unprofitable products. It cost very little of your time to "test the market" on eBay. You just need a few small repeatable successes.

Also, I highly recommend you have different accounts catering to a specific niche, preferably with your username equivalent to your .com.. although the recent eBook changes have made it alot tougher to build feedback.

In summary of this long winded post:
1) Accept that you will have tight profit margins from dropshippers or light bulk wholesalers.
2) Sell lesser known products or create unique products.
3) Upsell like crazy.
4) Never sell at a loss or undercut the competition. Forget about competing with anyone on price.
5) Eliminate products that don't work out, and keep trying new ones.
6) Different accounts is good if your username matches


Arnold said...

Hello, thanks for the post it's really interesting. I am trying to start my business on ebay and I am having some troubles with droppshippers. I still find it difficult to find the best out there.
Could you share with me some of your dropshipping contacts?



Anonymous said...

Hey buddy,

You are helping me a lot with my online start up with all the great information you share with us. Love your blog. I am getting ready for ebay soon and i am sure you and your blog will help me in the right direction.



Jennifer said...

I tried selling used books and cds from my house a few years ago on ebay. Didn't make much since they weren't unique but it was all profit since I had already bought them for myself.

I have a friend that makes a great living on ebay selling very lightly used designer clothes she gets from various thrift stores and junk shops, etc.

ameo said...

nice , i didn't use ebay before

although it's always there :)

will give it atry .


George said...

When you say upsell..... what exactly do you mean?

You mentioned bundling, would you consider that an upsell?

And, how much money, on average can be made in your experience.

One more, do you use the stock pictures provided by the dropshipper? I'm an eBay fiend (like over 1k a month spent usually) and when I see stock photos I skip over.

Peintros said...

By upselling, I meant both bundling, and through emails.

I hit them with emails after the auction, after their initial purchase, and after the package has been sent where I mention another auction they might be interested in (if I have one) and I also have a squeeze page associated to my eBay username (you are not allowed .com or _com in your username so i might have something like bobsdiscounts as my username, an as my site where I have a squeeze page). On my squeeze page, I generally "pretend" I have an exclusive list for discounts, and then just tell people about my auctions, or items I might put in store, and I think I'm also going to start telling people about other auctions on eBay for similar items, and use eBay's affiliate program.

Bundling for sure is a way I upsellalso, I will say this item is also available in whatever bundle.. generally I only sell single items that are unique, otherwise I stick them in a store where you can get higher prices.. which I forgot to mention. I generally don't let stuff die that won't sell at auction, I just stick it in the store, and once in awhile people buy that stuff (even though I might consider the price "too high" myself).

As far as niches go, the first and least successful niche I tried was digital cameras. I found there's just too many people.. probably either buying the from liquidators, on the "gray" market, or maybe even selling at a loss.

I won't get into niche specifics that I've had success with for obvious reasons, but I have had success with a niche within the baby niche, and a niche within the software niche to give you an idea.. those two are steady income earners. I use terapeak to "drill down" niches looking for both a high sell through rate, high bids, and then onto specific products sold by the top sellers and doing the same.