posted on July 20, 2001 01:47:15 AM
I have been lurking around on this forum for awhile. I have also been a casual ebay/yahoo
user for several years. I have read about those people who have been able to create a
"mini business" or steady extra income based on auctions. Would anyone ( a veteran perhaps) be willing to list some advice or techniques on how to do this?
For example, How does one go about looking for and acquiring good merchandise to sell?
posted on July 20, 2001 02:08:50 AM
To run a small business through auctions you need a of goods to sell, lots of storage space and a good system for listing, tracking, mailing etc. Also, you will not make money for a quite a while because you will need to reinvert your profits in more inventory. It is very time consuming and it only works if you enjoy it. (I have been selling for about 4 years.) There are several books on how to do this; Ebay itself as well as these message boards have a lot of information.
The hardest step is finding things to sell. Live auctions, estate sales and yard sales are often good places to look These items need to be listed one at a time but can be very profitable. (You need to know what thinkgs are worth and what they will sell for.) Is there a factory in your area which makes something that would be good to sell? You can try places like liquidation.com but I have never has luck there. I started when I bought a truck load of new collectables from a liquidator. It turned out to be a great deal and I am just finish selling the stuff. (You need to be very careful with liquidators. I have been burned more than once.)
I am sure many people will have lots to add. Your question is not an easy one to answer.
posted on July 20, 2001 04:20:17 AM
My best advice is stick with what you know and love, whether that is model trains, movie memorabilia,coins what ever you have a passion about, 2nd I would do research by studying the catagories you plan on selling merchandise. My 3rd advice is learn all you can about HTML, ASP, Java and the internet in general. This can give you an advantage and save you money. 4th look into sources in your area for merchandise wether that is flea markets, garage sales or wholesalers.
Bottom line take time to research and make plans. Rember to keep it fun, it can get overwhelming quickly.
posted on July 20, 2001 07:17:56 AM
Hindsight is 20/20 so here goes.
The above two posters give good advice. Hopefully I can add some that's worth reading.
I like things orderly, so my filing system, though simple is meticulous. Three basic files: WBN sent, Payment rec'd, Item shipped (last one is a drawer rather than a file).
Get a PO box. 99.9% of the people you deal with will be nice normal folks. The PO box is for the wackos - no sense giving them your home address.
Before you start, do a "Lifecycle" of a transaction. eg: buy inventory, clean/refurbish inventory, take pics, do descriptions, ftp pics, list auction, notify winning bidder, log payments, ship. (and anything I've left off because this is off the top of my head) While eventually, this will become second nature to you, in the beginning it might help to have this so you can decide if you like doing one or two auctions from beginning to end, or if you like "batching," i.e. taking tons of pics, etc.
Learn about shipping. Get the rates from the usps, ups, fedex, etc. Learn to use the online rate calculators. Buy a scale. Really. Your guesstimates will lose you money more often than not.
Read these boards. Tons of info here.
Buying what to sell. Sticking with what you know and love is good advice. Which doesn't mean you can't learn about new things. I just started selling books a few months ago, and I've had tons of help on this board, the BSFI group over at yahoo, and all over the web.
eBay (if that's where you're going to sell) can be your best tool in finding out what to sell also. Search current auctions and closed auctions.
Have a reliable ISP. Two email addresses (one like yahoo for eg.) are good in case a winning bidder uses a service blocked from your ISP.
Do profit analyses. Do you want a set return on investment? A minimum profit per auction? Also remember when you buy something that shipping cost is a factor. So if you buy something for $3 you think you can sell for $10, if the shipping on it is $7, you might not get any bids because it might not be worth $17.
Decide your payment options.
And since it sounds like this would be a second income for you, have tons of fun. Don't worry, I did everything wrong (except I always kept good files) and I'm still here, and I get better every month (summer's a little flat). Any mistake you make purchasing (unless you invest big money) can be solved with your own yardsale.
posted on July 20, 2001 07:20:34 AMFor example, How does one go about looking for and acquiring good merchandise to sell?
This is the secret to buying and selling (particulary used merchandise)
The secret is know your merchandise. If you know more than most people, it gives you a big edge. You can't be an expert on everything, but do try to be an expert in what ever field you sell in.
Who Need's a stink'n Sig. File?
posted on July 20, 2001 07:35:00 AMKnow your merchandise is excellent advice. I've only been selling for a couple of months, and I'm already finding things at yard sales that I recognize as money makers. When I started, I wouldn't know one way or another.
posted on July 20, 2001 08:03:59 AM
If you want to sell new items, you will have to search for a source that can sell it to you for below-wholesale. If you try to buy at wholesale & sell at retail prices, you will end up sitting on a ton of merchandise. Search ending prices on completed auctions for a guide as to what things in your area of interest are going for before you invest a lot of money.
A good way to get started is to sell off things from around the house just to get the feel of how things work.
posted on July 20, 2001 08:13:00 AM
I basically had this same question from a friend recently. She knows I run a part-time business doing this, and make a steady income. But while I could tell her what I do, in nauseating detail, I couldn't really find many universal tips, especially for finding inventory. I do what I do based on months of trial and error, constant scrounging and looking for new angles, and taking advantage of contacts and "ins" where I can get them [like friends who save me boxes and packing supplies]. Everyone has to find their own angles and supplies.
One thing that does bug me is running into folks who are doing this and bragging about not getting a business license, paying taxes...one person even described stealing her auction photos! So one piece of advice is to plan from the beginning to be legit and do it the right way, even if it seems to be just an added expense and pain. I think that conducting yourself like a true business with integrity just impacts everything you do, and is well worth it in the end.
off my soapbox now..
keziak
P.S. a great book is "Starting Your Online Auction Business". It's available on Amazon.
posted on July 20, 2001 08:41:03 AM
#1 Decide which two rooms to sacrifice the 1st year.
#2 Decide which two rooms to sacrifice the second year.
#3 etc.
Once you get room #1 filled with inventory, start an assembly line.
For example (our model):
If it's in room #1 it's "to be listed".
If it's on the table where you eat, it's ready to be photoed.
If it's on the kitchen cabinets it's ready to list.
If it's on the kitchen floor it's just listed and ready to be moved to the formal dining room table. It sits here until it gets a bid.
When it gets a bid, move it to the buffet to be packed. Next to that you will need 12"x12" of floor space packed to the ceiling with large boxes, newspaper, peanuts.
When it's packed, move it to the folding table you are going to set up in the dining room. Here it waits for payment. This might be a week....or it might be a month.
When you receive the payment, move it to the industrial shelving in your dining room that you have set up to hold postal bins (only if it's USPS)..but if it's UPS then send it back to the kitchen floor by the back door to wait for UPS.
If you decide to do Amazon too then you will need makeshift bookshelves (unpainted is ok) covering your entire house floor to ceiling. You will need to alpha by author.
If you plan to bring home 18-20 truck loads of vintage electronics every 6 months like my hubby does, then you may need more space.
For the first 2 or 3 months, a wall chart helps all family members understand the assembly line process. Using this method, everyone in your house should work at optimum effectiveness 24 hours a day 7 days a week in hopes that you will make a modest living.
posted on July 20, 2001 09:09:29 AM
Jt- LMAO- very funny, but true! My den is full of beer cans from top to bottom!
First like everyone has said, be prepared to block at least one whole room off for this---a huge must and first is a good digital camera- you will not get many bids without a picture, or with fuzzy pictures.
Sale a few of your items first, I always research an item before I sale it- Check completed items, ongoing auctions, ect....
Be prepared to take some losses or not have your item go very high until you build some feedback(thats why I think getting rid of your own items first is a good idea)Always be honest about your item. If there is a stain or rip, let them know.
I specialize in sporting memorbilla,well my husband does this, and childrens clothing. Most of my inventory comes from buying clothes and such at the end of the season when I can get 70-75% off(you have to get name brands to, kmart does not cut it), then you have to sit on them for a few months until they come back into season. Example- I just bought 8 pairs of kids NIKE shoes for $7.99, with school season I will probably get $20plus. If you run accross a good sale-buy all that you can. if it does not sale, you can always return it with your receipt(I have never had to do this yet) 50% off is never good enough, people on ebay are looking for a bargain for the most part. Never list multiple products of the same type, that = lower bids.
I also search auctions for newbies that mislist their item and put a dumb buy it now on it! Snatch- its mine and I resale it for triple(most of the time)
THATS WHY YOU HAVE TO KNOW YOUR PRODUCT!!!! Knowing about what you are listing and buying=big profits.
posted on July 20, 2001 10:08:52 AM
Get a re-seller license. It is free in my state (California). This opens the door for you to join different vendor associations or web-sites where you can find the great bulk deals on used or new items. I sell mostly computer items, so this has been a great resource for me.
If you buy in bulk, you need to only take the picture and describe the item once. After that its all about re-listing...
posted on July 20, 2001 10:27:12 AM
If you are in a state that has a sales tax, get a resale or sales tax permit so you won't have to pay tax on the items you buy at auction, in antique shops, etc. Such a permit if free or cheap in many states.
Of course you will have to collect and remit tax for items sold in your home state...
posted on July 20, 2001 10:39:15 PM new
Thanks for all the useful info. If anyone wants to add to this thread feel free.
People have been most helpful.
posted on July 21, 2001 07:17:22 AM new
Whenever someone ask me this question, I always tell them the most important thing is the product. And finding a product is not easy. Most newbies think they can just list anything and it will sell with no labor involve. Thus, I always ask them to go thru the following process:
1. Think of a dollar amount you want to sell annually on ebay - for example, $50,000.
2. Think of a product you can sell that is priced lower or cheaper than what you can find at the local Walmart or Home Depot, shippable, makes someone want to go thru the hazzle of bidding on it - sending money to strangers - paid shipping costs - deal with ebay system downtime/slowness - etc...
3. If you can define such a product (from step 2) and have sources for buying such a product, then come up with an average selling price via research on ebay - for example $10/each.
4. Now see what kind of margins you can make before all fees - for example 100% or $5/item. This is to ensure you are not losing money on every sale.
5. Divide your gross annual sales target by the average selling price and see if it still makes sense that you can sell so many units - for example $50,000/$10 = 5,000 units.
6. Now see if it is possible for one person to list, invoice and ship the 5,000 units each year. Also, don't forget the time to do the bank deposits and bookkeeping.
7. If everything is still a go, now worry about the capital needed as well as storage space.
Most people will not pass all seven steps and give up at this point. However, for those few that do, you then compute the anticipated profit factoring all projected costs. See if the projected net profit is worth all the effort. If still yes, then make sure to keep a low profile and not let anyone know you found such a product. Otherwise, other sellers will come in and basically destroy the market.
Of course, sooner or later, other sellers will come in. Hopefully, it will take a year before they do.
