Selling on eBay can be very rewarding. Since its launch in 1995, eBay has become the world's largest online marketplace, with around 181 million customers. Such is its success, around 43% of all internet users in the UK visit the site every month, with an average user spending almost two hours on eBay every single month.
With such impressive statistics, it is no wonder that a lot of small businesses look at eBay as a way of getting into online sales and growing their sales. However, it is not all plain sailing, and more than one business has found that it can be a very time consuming way of not making any money at all!
However, there are a few pointers that can make trading on eBay profitable, interesting and fun. Have you noticed how some sellers can get significantly more bids and higher prices, whilst other sellers offer the same items at lower prices and get little or no interest?
Well, the good news is, it isn't down to luck. Put in a bit of effort and a bit of planning, and you too can become one of the successful and profitable eBay traders.
So whether you just want to sell off an old computer that is just gathering dust in the corner of the office, or whether you want to build up a regular flow of business, here are a few pointers to help you get started.
For the purposes of this article, I'm going to assume that you have a basic knowledge of eBay. You may have browsed through the listings and bought a few things and possibly sold a few items as well, but now you want to take things further.
Know the Law
Before you start, it is worth reviewing the legislation regarding internet selling.
If you sell products to consumers, you need to be aware of the Distance Selling Regulations and the E-Commerce Regulations which give protection to consumers who shop by phone, mail order, via the Internet or Digital TV.
In brief, these regulations provide protection to consumers in the following ways:
More details can be found on the Government's Business, Enterprise and Regulatory Reform web site - http://www.berr.gov.uk/consumers/buying-selling/distance-selling/index.html
Get using eBay
If you have not already registered on eBay, get yourself a user name and start trading. Give yourself a sensible sounding user name that will add credibility to whatever it is you are going to be selling. Register yourself as a business user as this will give you easier access to more business functions within eBay later on, and register yourself as a Seller as well as a Buyer.
Start browsing some of the eBay listings, notice how different people list their items. If you see a listing that you particularly like - because of the description, the detail, the photographs, the layout - whatever - print a copy off. You may well want to do something similar yourself when it is time for listing your own items.
Again, if you don't already have one, get yourself a PayPal account. Again, get a business account, and register yourself as a seller, so that you can receive payment, as well as a buyer.
Start buying a few small items on eBay. You don't need to spend a fortune, but start getting comfortable with the process. Ask questions about different listings and notice how you react when you get the replies. Bid on items in auctions, and buy items using the 'Buy It Now' facility.
When you've bought something, make a note of how you feel when you've completed the sale, how you feel after you've been in touch with the seller and how you feel when you've received the item. Analyse what makes you feel good and what makes you feel bad about each transaction. When you are the seller, you want to be able to give your customer the positive feelings, and none of the negative.
When you have bought something and received it, leave good feedback for the seller. They should reciprocate and give you good feedback in return. The more positive feedback you get the better, as this will help your credibility when you start to sell yourself.
Research Your Product, Research Your Market Place
Do you know what you want to sell? Do you know who else is selling a similar product? What price are people paying for similar goods on eBay? Is your product going to be easy to get delivered? If you can find the right product, which you can sell at the right price, and there are enough people wanting your product, you're half way to achieving a successful eBay business.
It can be a bit like finding a needle in a haystack, but fortunately there are a few things to help make things a bit easier.
If you have no idea of what products you want to sell, but you are still interested in doing something on eBay, get a copy of The Trader and Exchange and Mart from your local newsagents. The Trader is a monthly stock magazine and lists a lot of the wholesalers that supply market stalls, shops and other eBay traders. If nothing else, it will provide you with a whole list of suppliers and could spawn off some other ideas of what you want to sell.
Consider your product. It isn't always necessary to pick a product you know about, although this can help, but there are a few things that you should consider.
Firstly, how are you going to get it to your customer? If it is a big, bulky package, or if it weighs more than 25kg, it is going to cost a lot to get it delivered. It is also going to be difficult to collect it from a customer if there is a fault with the product. Is the package fragile? If so, expect problems with deliveries - no matter how well you think you can package it up.
If your item is too big or bulky to post, phone up a couple of parcel carriers to get some quotes. Use a reputable parcel carrier like ByBox, Initial City Link or Amtrak if you have a valuable item that needs to be looked after in transit. If your item isn't so fragile, consider cheaper carriers such as DHL and ParcelForce, but remember: you get what you pay for.
How safe is your product? How reliable is it? You may think importing electric scooters from China at $35 per unit is a bargain, but if the handlebars are wobbly and the batteries fail in the first few weeks, you're creating big problems for yourself.
If there are warranty problems with product - and inevitably you will have some problems sooner or later - how can you resolve these problems? Do you have a supplier who has the facilities and resources to resolve these problems, or are you on your own?
If your product passes these tests, the next step is to research your market and find out who is selling something similar on eBay. Fortunately, this is fairly easy as eBay itself provides some useful tools to help you get going.
The most useful tool is the eBay Advanced Search function. This function can be found next to the standard Search button on eBay.
Once you click on the Advanced Search function, you can start specifying what you are looking for in much more detail. You can exclude words from your search, you can specify a minimum and a maximum price, you can specify business or private sellers - although use this with care -you can specify what regions the seller should be in, whether the items should be new or used, and you can specify a range of how many bids the item should have in order to be included in the search.
More interestingly, from a viewpoint of someone wanting to research a specific product on eBay, you can specify Completed Listings only. This means you can see how many similar products to yours have been offered on eBay over the past month, what they sold for, if they sold and the number of people who bid on them.
Let's take an example. I recently wanted to sell a car on eBay, and wanted to see what similar cars had sold for over the past few days. Using the eBay Advanced Search option, I requested a search for Vauxhall Zafira, and then - as my car was a petrol car - I requested that my search excluded the word Diesel.
Because I knew that my car was worth between £2,500-£4,000, I then specified this price range in the search.
Very quickly, I was able to ascertain what other Vauxhall Zafira's have been offered over the past few weeks, how many bids each auction got and which cars actually sold and which did not. Listings with prices shown in green were auctions where the cars sold; listings with prices shown in red were auctions where the cars did not sell.
You can quickly see how many items that are similar to yours have been offered for sale - so you can identify if your particular marketplace is saturated or if you are one of only a few sellers selling your type of product.
The next step is to look at the auctions in more detail to find out if there are any clues as to why some auctions sold for more than others. It doesn't take long before you'll notice a pattern:
This is one of the biggest secrets of eBay: spend time on your listing, make yourself look professional, and you're a big step towards making a success on eBay. Write badly, with little regard to grammar and spelling, poor quality photographs, using silly fonts, musical effects or animated cartoons, or WRITING COMPLETE LISTINGS IN CAPITAL LETTERS puts off your potential customers and decreases your chance to make a sale.
By now you should have a feel for what your competitors are doing. Now consider what makes you unique. Why should your customers come to you rather than going elsewhere? What extra can you offer your customer that your competitor currently doesn't?
So now you know what product you're going to sell, which is easy to get shipped. You've found a supplier who can supply you with product and help you support it if it goes wrong. You know that there are customers out there who are buying the product, you know you can make a profit at it, you know who your competitors are and what will want prospective customers to buy from you rather than them. Well done. You're a big step along the way to making a success of eBay sales.
Now its time to forecast your sales and make sure you really can make a profit on your chosen items. You'll need to take into account the cost of getting products delivered to your customer - and if you need to buy them in bulk yourself, the cost of getting them to your storage facility in the first place.
Factor in the amount of time it's going to take you to manage the sale - put together the original listing, handle enquiries, sort out payment and handle the packaging.
Then you can identify your break even price. Compare this with the average price of bids on eBay for the products you are planning to sell and see what the difference is.
Test, Test, Test
Before you buy a huge bulk of product, try and test the market with a small sample. This may mean you having to buy your product at a higher price, which will negate any profit you may make in the first instance - but it's an awful lot cheaper than importing container loads of product in from China - only to find you can't sell it once you've got it.
Research your product thoroughly and get to know it as well as you can. Try one and use it yourself for a week. Then lend it to a friend and ask them to use it and to record their experiences with it. Read the manuals. If the manual is useless, confusing or non-existent, consider writing a brief one-page 'getting started' guide to help your customers get their new product working out of the box. Your customers will appreciate it and you'll benefit from not having phone calls and e-mails from confused customers.
Get some good quality photographs to put into your listing. If you can't get good photographs from your supplier or from the manufacturer, remember it doesn't cost a lot to get a professional to do some studio shots for you.
Photographs are a whole book unto themselves, but here are some general pointers:
Now you are ready to list your small sample of products on eBay. Start with two or three listings, each with different timings and layouts to see how they work.
How to make the most of your eBay listing
We've already discovered a few things about what makes a good listing and what makes a bad one. Now it's your turn to create your own sales pitch.
Start first with an attention grabbing headline and subtitle. In eBay, headlines and subtitles are important. When you search for items on eBay, eBay searches the headlines and subtitles for matching words and phrases, so you need to make sure that all the relevant search words are included.
eBay themselves have some rules about headlines and subtitles. You cannot say that your product is like an alternate product (i.e. "Ford Fiesta, like Vauxhall Corsa, VW Polo" would not be allowed).
Here are some examples of good and bad headlines. The good ones are in green, the bad ones in red:
Compact, lightweight folding bike/bicycle
'Folding Bike' is bad because it doesn't pick up on anyone looking for 'folding bicycle'. If people are looking for a folding bike, they also want something that is compact and lightweight, so if your folding bike is compact and lightweight, put this in the headline as well, so that you get picked up on people looking for 'compact bike', 'lightweight folding bicycle' and so on.
Smoothie/Smoothy Maker and Juicer with Recipes
'Smoothie Maker' doesn't say very much - there is nothing to differentiate your product from hundreds of others. But all smoothies can make fruit juice, so add that in as well. The handbook from a smoothie maker normally includes recipes, so add that as well. And as for the the alternative spelling of smoothie? 'Smoothie' is an easy word to mis-spell, so if you include the most likely alternative, you'll get picked up if someone searches for 'Smoothy Maker'. The likelihood is, none of your competitors will, dramatically increasing your chances of a sale.
Once you've worked out a headline, write your auction description in Word. Don't start writing it on the eBay web site - using Word allows you to run a spellchecker when you've completed - and it is then easy to cut and paste your description onto the eBay site.
Remember you're writing an advertisement, and many of the tips that are relevant to writing good advertisements apply equally well to eBay.
Remember there are 'magic words' in advertising: Free, New, You, Yes, Discover, Benefit, Money, Guarantee, Now, Secret, Proven. If you can include these words in your auction listing, you'll reap the rewards later.
Whilst writing your listing, focus on the benefits of what you are trying to sell. If you do mention a feature of your product - highlight what benefit that will be to your customer.
Make sure you promote your Unique Selling Features in your auction listing. Ask yourself "why should people buy from me?" - and put your answer into the listing. If you are offering a money back guarantee, put it in the auction listing. Incidentally, remember that the distance selling directive states that consumers have the right to change their minds and return their purchases within seven days of purchase, so why not claim that as a benefit from buying from you? Think about it:
Money Back Guarantee
We're absolutely confident in this product.
But if you are not satisfied with your purchase,
return it to us in new condition within seven days
and we'll give you your money back - no questions asked!
Bingo! Instant credibility.
Other things you could include to help people choose you:
» Free Delivery
» Guaranteed Next Day Delivery
» Free Gift (but make it relevant)
When I write a listing for eBay, I tend to write the first paragraph as a summary of what is on offer. I make it snappy, exciting and interesting. Here is an example I used recently when helping a local garage sell a classic BMW on eBay:
You are bidding on a superb example of the iconic BMW 3-series coupe: a car that is now a proven classic collector's car in its own right. This particular example is in excellent condition, is exceptionally tidy inside and out and represents fantastic value for money.
I then went on in subsequent paragraphs to give more details about the car, interspersed with lots of photographs of the car along the way.
One other thing to include in your auction listing: your name and telephone number. Put it somewhere in the first three paragraphs, and repeat it at the end of the listing. Make it easy for people to get in touch with you, and prospective customers will feel a lot more comfortable about buying from you.
When you've finished writing your listing in Word, save it, print it out, then go away and do something else for half an hour. Then come back to what you've written and go over it again. It can help to read your listing out loud and make sure it sounds right to you.
Setting the Price
You will obviously have a minimum price that you are prepared to accept for your item. There are two ways of setting this price:
» Either use this minimum price as the starting price, or
» Set a hidden reserve price
I personally tend to choose the latter and start the bidding from 1p. The reason for this approach is two-fold:
There is also a 'Buy It Now' feature in eBay, which allows people to buy the product straight away and short-cut the rest of the auction. If you are a new eBay seller, you won't have access to Buy It Now - you need to have a feedback of at least +10 before eBay allows you access to this facility.
Buy It Now is ideal for people who want to buy something and get it in a day or so. People who use Buy It Now aren't so interested in getting the best price, they just want it quickly. However, some people are put off bidding for an item if they see a Buy It Now price as they assume you're reserve price will be set at a similar level.
For that reason, I tend to set up a separate auction if I am offering the same product on Buy It Now (assuming I've got more than one item to sell) with the start price set at your minimum reserve price and the Buy It Now price alongside it. You'll get less bids, but you will attract a different type of buyer to your auction listing - and one who isn't necessarily so interested in getting the cheapest price.
You'll want to be paid for your product, so make it easy. Most eBay auctions are paid using PayPal: your customer has a choice of setting up a PayPal account (and millions have already done so), or just entering their credit card details online when they want to pay. PayPal commission rates are very competitive when compared to more traditional credit card facilities, so it is also popular with etailers.
The problem with PayPal is that there are limits on how much money you can withdraw from PayPal until you've gone through a number of levels of certification. It's the same with buying on PayPal: if you buy using your PayPal account, you have a maximum spending limit of £500 until you've gone through further credit checks.
These credit checks take time to sort out, which can make PayPal frustrating to use for bigger purchases. So it is always worth having other options available alongside PayPal, in order to make it as easy for your customer as possible.
If your business offers credit card payment already, make sure your listing tells your customer that they can phone you up to pay by credit card. This will encourage people who distrust online payment systems, and help you build up rapport with your customer once they've bought.
For customers who are coming to collect you can always accept cash, and if your business can already accept credit cards, you can offer them that when they arrive. Beware of bankers drafts though - there are so many frauds with bankers drafts that you must make sure the money is in your account and that the transaction has cleared, in the same way as you would a cheque.
Most people will accept that if they are paying by cheque that there will be a delay before they can have their goods. Be wary of customers pressurizing you to release the goods early.
Shipping and Deliveries
Before you get listing, investigate how you are going to get your product to the customer. There are a number of different methods around, and a large number of companies offering delivery services. One size doesn't fit all, however, so shop around and find out what works best for your business.
When choosing a shipper, here are a few things that you need to consider:
Can my product be posted?
If the answer is yes, you've got the perfect answer: post it! Royal Mail have got the best delivery network in the UK for delivering letters, small packets and compact parcels (up to 1kg). They're also one of the cheapest ways of getting products delivered to your customers and deliver the majority of their delivers before lunchtime the day after posting.
If you need proof of delivery, the Post Office offer 'Signed For' and 'Special Delivery' options, and if your customer isn't at home during the day, you can offer the Local Collect service - where the package is held at a post office branch nominated by the customer, so they can pop in and pick up the package when it suits them - during a lunch break, after dropping the kids off at school, or whenever.
There are limitations, however. Tracking packages when they go astray is almost impossible, and Royal Mail are not the best parcel carrier when handling larger, heavier or fragile consignments.
Is my product fragile?
If so, you need to look at your packaging as well as your carrier. Make sure that whatever your shipping is packaged so that it can survive being dropped from 50cm onto a hard surface.
Is my product going to sell to professional people?
If so, the chances are, they're not going to be around to receive their package. If it is too big or valuable to be delivered by Royal Mail, consider using an unattended box network such as ByBox - they have a network of parcel vending machines around the country. When your package is delivered to the vending machine nominated by the customer, they get a mobile phone text message to let them know that their package has arrived, and giving them a unique PIN number. They go to the vending machine, type in the PIN number, and the secure locker door opens so they can collect their parcel. Vending machines are open 24 hours a day, seven days a week, and deliveries are made before 8am in the morning.
Is my product over 25kg in weight, or longer than 1.5 metres in length
If so, you are going to need to use a specialist delivery network such as Nightfreight. Recent changes in legislation means that most delivery companies can only handle smaller parcels. Heavier and bulkier packages are also more likely to be damaged in transit, which makes using a specialist much more important.
How important is customer service to me?
If the answer is 'yes', or if you are using eBay to spring-board your own e-commerce business, choose a delivery company with a good reputation and with a high level of package tracking, which will reduce the number of mis-routes and lost parcels.
A few years ago, after experiencing problems with one parcel company, I started using City Link. City Link offered a superb track and trace system that meant I could check the status of all my deliveries first thing in the morning, and get proof-of-delivery within minutes of the package being delivered. The customer service and quality of business was superb, but what made the real difference is what happened on the rare occasions when something went wrong. If there was a problem with the delivery first thing in the morning (if it had been misrouted, for example), I could call the customer first thing and apologise for the problem. It was always appreciated - the customer didn' have to stay in all day waiting for a parcel that wasn't going to arrive, and I always got great feedback from the customer when the problem was subsequently resolved.
Getting your auction listing live
Once you are happy with what you have written, it's time to enter the information into eBay and get your auction going.
To do this, click on the SELL button at the top of the screen in eBay and follow the instructions. Type in what you are selling and eBay will suggest some relevant categories. Select the best fit category and then continue.
Enter your title - and subtitle if you so wish, and then upload your photographs.
The more photographs you upload, the more it costs, but it is never worth skimping on photographs. Upload at least six photographs - your prospects are going to want to see exactly what they are getting.
Select the option to have a Gallery Picture. This means that prospects get to see a thumbnail-sized photograph on the eBay listings page - which dramatically increases the number of people who will click through to see your listing.
Cut and paste your listing description from Word into the description. Then use the formatting tools to tidy up your listing: I personally tend to make the first paragraph bold, and tend to change the font size to make it slightly larger than standard, which has the benefit of making the listing easier to read.
eBay has a number of 'listing designer' options, which I tend to avoid as most of them look tacky and cheap. Feel free to look at them though, if you feel it would benefit your listing. One advantage that the listing designer has is that you can then put a picture at the top of your listing, which does help.
Next, set your start price, reserve price and - if you wish - your Buy It Now price.
Next comes the option to make your listing private. This means that all buyers remain anonymous to other eBay users. Select this option.
There are two reasons for doing this:
Select your payment methods and set up your postage options. Offer the option to allow the customer to collect the item from you as well - this adds extra confidence in your auction, as it shows you are approachable, both before and after the sale.
Finally, set up the Returns Policy, and if you want to give your buyer some further information which they'll see once they've completed the auction, add this to the 'Additional Checkout Instructions' field.
Once you've completed posting your listing, make a note of the auction number, which will come in handy later on. View your auction so you can see what everyone else can see and make sure you are happy with it. If you are not, edit it immediately - because you will be limited in what you can do with your listing once you start attracting bids.
Now the fun really starts!
Running the Auction
For the first day or so, I usually let the auction run its course. Because eBay lists all auctions in date order, your listing will usually be near the back, so a lot of bidders won't see it in the early couple of days. You'll probably get one or two bids - opportunists who see the potential for a bargain - but that is probably about it. After that, things get a little more interesting.
For obvious reasons, eBay won't allow you to bid on your own items - but of course, there is no reason for you not to ask a couple of your friends to put in some low bids. This increases the number of bidders, and the number of bids that at item receives, which for some curious reason, makes your auction more interesting to other eBayers. If you can get 10-11 low bids in at an early stage, it can make a big difference later on. You still want your listing to appear cheap, however, so make sure your friends are well briefed.
If I were selling a £400 product, and I had started bidding off at 1p, for instance, I'd want to cap these bids off at around £80.
Then you leave the auction to run its course. Answer any questions you get on e-mail or by phone quickly, promptly and as friendly as possible.
Most auctions really come alive in the last few hours. I usually check the auction about twelve hours before it is due to close, and if the bidding is still low, I'll get a friend to put in a bid to bring it very close to the reserve price (i.e. £2 under), so that the next successful bidder will win the item. Then I leave it to see what happens.
It can be quite exciting to watch the end of the auction. If there are a few genuine bidders on there, your sale price can go up dramatically in the last two minutes of the auction. This is one of the other benefits of getting a lot of bids in at an early stage - eBayers then think this is a popular item, which increases the desirability of the product. I sold a fan heater on eBay once. It cost me £65 to buy and had a list price of £199. Because of last minute bidding, I sold it for a staggering £235. I wish I could say this was an every-day occurrence for me. Unfortunately, it isn't, but it does show what can happen in the last two minutes of an auction.
As soon as the auction completes, use the eBay facility to get in touch with the buyer and send an invoice. Thank them for their purchase, and let them know your telephone number, in case they want to get in touch with you again.
At this point, you'll be able to see their full details - name, address and telephone number. Make a note of this (I tend to print off a copy of the invoice, which I then attach to the item when I ship it off), as it can be hard to get access to later on.
The Next Steps
The rest is just good customer service. Telephone or e-mail your new customer and thank them for their business. Assure them that they have bought a great product and remind them of the warranty and money-back guarantee, if you offer that.
If they haven't paid already, ask them how they would like to pay. If you offer credit card payment facilities, now is a good time to get that sorted out. If you are getting the product delivered to them, ask them what day would be convenient. If they are not around during the day, tell them about the ByBox parcel vending machine service and ask if they would be interested in using that.
Finally, keep them informed. If there is a problem with payment, get in touch with them - it is usually the technology that has failed rather than malace on their part. If there is a problem with delivery, let the customer know as soon as possible.
There is one final tool that eBay gives you, which is suitable where you've got multiple items to sell: the 'Second Chance Offer'. If you had several bidders bidding acceptable amounts of money for your item, you can give them a second chance to buy your item at the price they bid at in the auction. It's a great tool, allowing you to potentially sell a few items at the same time.
After the Trial
Now is the time to go back to your forecasts and see how well you performed. Have you made money during the trial? If not, are you going to make money when you start selling in bulk? If not, it's time to try something else.
If, on the other hand, you've done well with your trial auctions, it is time to move onto the next stage. Refine your listing, start more auctions and take it from there.
Finally, even if you've found the golden goose, don't expect it to last. You need to start finding the next killer-product to sell. If you're doing really well with your current product, other businesses will start selling it as well. eBay is such a big market, you always need to stay one step ahead.
When you've found your next product, get in touch with your existing eBay customers and let them know about it. Especially if it a related item to your first product, this could be a quick way to make some early sales.
When you're starting to sell reasonable volumes of products on eBay, you'll start needing to look for ways to automate your eBay listings and sales. There are a number of products on the market. Do a search on Google for 'eBay automation' and see what comes up.
Finally, don't forget to keep checking your performance against your forecast. Make sure you really are making money and most of all: have fun! eBay is a great community and an enjoyable way to create an additional revenue stream and get your business known by a wider community.
I wish you the very best of luck on your eBay venture!