You're Not Alone
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Millions of sellers have shown how easy it is to sell on eBay. But starting a business on eBay brings selling to a whole new level.
Luckily, it doesn't have to be a lonely climb to the top. eBay and third parties offer sellers tools and services for sourcing products, building and maintaining a multichannel presence and attracting buyers.
Sourcing is usually the first hurdle, and it starts with figuring out what to sell. eBay senior manager Laura Della Torre, who's responsible for the eBay Certified Provider Program, says one of the best things new sellers can do is start with reasonable expectations. "It's not going to be as easy as Googling a product you can buy for 99 cents and then selling it on eBay for $400," she says. Though these success stories do happen, they are few and far between and don't work as a long-term strategy for entrepreneurs looking to run a stable business on eBay.
The ultimate goal for any eBay seller is to build a stable relationship with a manufacturer or wholesaler that can offer a reliable product stream at favorable prices. It takes time to get there, but options exist. There's even a shortcut or two along the way.
One of those shortcuts is eBay's Certified Providers. Two companies-- Doba in Orem, Utah, and Worldwide Brands in Maitland, Florida--are Certified Providers that help sellers make connections with suppliers. Certified Providers must meet eBay's standards for knowing how to work with eBay and must have a proven track record of doing so.
Worldwide Brands has a directory of prequalified wholesalers who have agreed to contract with internet businesses like eBay Stores. The listed companies provide options such as liquidated merchandise and small shipments (known as light bulk wholesale) for orders sometimes as low as $500.
While Worldwide Brands offers a convenient directory of potential suppliers, Doba lets entrepreneurs place orders directly on its site after they choose a product and its supplier. The company specializes in drop-ship providers, meaning the supplier holds on to the product until it has been sold to an eBay buyer. The drop-shipper then does the shipping and handling.
Margins are thinner with this sourcing method, since the supplier bears the risk of an item not selling and the responsibility for delivering it intact. "Drop-shippers are not meant to be a main source of supply," says Della Torre. "But they can help you test products on the site to guide you in the right direction."
Services like Doba and Worldwide Brands also help beginners by offering a broad range of products to choose from and experiment with. Established entrepreneurs may find their services valuable for products ancillary to their core business and as a potential method for cross selling or bundling products.
If your past success sourcing products has landed you in the PowerSeller category, you can find another sourcing shortcut through eBay's Reseller Marketplace (ebay.com/reseller). This service gives PowerSellers access to manufacturers, wholesalers and liquidators selling in lots as small as 10 items or as big as a pallet.
As with eBay Certified Providers, businesses selling through the Reseller Marketplace can be more reliable than those found randomly online. "These are sellers with U.S.-based references and products that come as they're described," says Justin Marcucci, senior marketing manager at eBay. "Buyers can feel confident knowing these businesses are legitimate."
To make it easier to track what's available on the Reseller Marketplace, eBay issues a product sourcing newsletter every week highlighting listings. Sellers can also use the system's Auction Agent, which watches for items that match a seller's preselected product search terms.
Once you have what you want to sell, you also have a choice of where to sell it. Customized online storefronts are available through eBay's ProStores program and help eBay sellers quickly establish their own e-commerce sites.
With ProStores, entrepreneurs can choose from more than 150 templates that include inventory management, sales tracking, online marketing tools and a shopping cart. The ProStores web store differs from an eBay Store in that it is completely self-branded and separate from eBay.
The two can work together, because they often serve different online buyers. "Not every buyer is an eBay buyer," says Eric Shoup, the eBay general manager responsible for the ProStores program. ProStores makes the most sense for entrepreneurs who already have product or name recognition, can reliably drive customer traffic to their site and have a steady product source. ProStore customers pay a monthly subscription fee and a per-transaction fee based on sale price.
Becoming an eBay Trading Assistant and selling for others may provide you with a steady supply source. Trading Assistants, or TAs, are experienced eBay sellers who meet eBay requirements, including having sold 10 items or more on eBay in the past three months; having feedback scores of 100 and up with at least 98 percent of it positive; and having an eBay account in good standing. Finding the right relationship is key. Many TAs have marketed their services to local retailers to help them sell excess inventory or even to large businesses to sell their retired equipment on eBay.
If getting the product is no problem but finding the time to sell it is, consider hiring a TA. TAs do all the work of listing, selling and shipping your item for a percentage of the sale price. Some TAs may even have a retail outlet so you can conveniently drop off your items at their location.
You can check eBay's online directory to search for TAs by ZIP code or by the type of item you want to sell. "My advice is get two or three names, call them up and see if you feel comfortable with them, especially if you are handing over valuable merchandise," says Sharon Guldner, senior marketing manager at eBay. Many TAs are bonded to protect their clients, so make sure to ask them if they are.
TAs are independent businesses, so their fees may vary, but fees average around 30 percent of the sale price, plus eBay listing fees. Like any business arrangement, be sure to get everything in writing, including proposed fees and details about what happens if your item doesn't sell. "Most reputable Trading Assistants will have a contract form all ready," Guldner says.
For more information about TAs, go to ebay.com/ta.
The eBay Partner Network
Even if you have no products to sell, eBay can still provide moneymaking opportunities. The company's Partner Network has a program in which participating websites can earn eBay sales revenue by posting an eBay link on their site and getting visitors to follow through with an eBay purchase.
Site owners make money when visitors click on the eBay link and make a purchase. The program, which is open to any website, including blogs, offers a return of 50 percent to 75 percent of the item's listing and final value fee. The Partner Network also gives entrepreneurs between $25 and $35 per active new user--someone who registers for eBay for the first time, confirms their registration with an eBay-supplied password and places an eBay bid to purchase an item within 30 days of their original registration. "The Partner Network is a great way to get opportunities out to smaller sites that eBay would not otherwise reach," says William Martin-Gill, senior manager for eBay's internet marketing group.
eBay enhanced the Partner Network last spring, making it easier for sites to register and giving them more choices for displaying the eBay link. Options include a linking tool to help potential customers find the products they want, geographically targeted banners so customers can find sellers in their own country, and displays of specific products related to the site. Like all the tools offered through eBay, the Partner Network gives businesses what Shoup calls "a nice little boost."
Julie Monahan is a writer in Seattle whose articles on small business and emerging technology have appeared in numerous consumer and trade magazines.