Selling Your Inventory Online
Established retailers find success on eBay by selling much more than their tried-and-true inventory.
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Retail may not be dead, but it is finding new life online.Retail overstock, damaged items and customer returns have longfound buyers on eBay. Now, many retailers are turning to the onlinemarketplace to expand their core business or to become multichannelsellers, without the cost of leasing more real estate.
The move from a local retail store to a global online marketwill likely require a shift in sourcing to match demand frommillions of potential new customers. Some retailers simply buy morefrom existing suppliers, especially if bigger orders result in abetter price. But this strategy overlooks the potential of eBay tohelp sellers experiment and diversify, creating a more stablebusiness with a broader customer base.
To tap that potential, businesses will need to find newwholesalers, distributors and manufacturers. It's a processthat can require days of internet searches, but trade shows, onlinewholesale portals and merchandise marts make your job a littleeasier by pulling together names and contact information in onecentral location.
Unlike many eBay newcomers, retailers have the advantage ofproven sales performance to help win over vendors wary aboutselling to internet businesses. eBay's wholesale listingsovercome the problem altogether by linking retailers with sellersalready comfortable with the eBay process.
Many businesses turn directly to overseas manufacturers, usuallythrough facilitators or agents with experience in foreign markets.Online agents such as ImportExportHelp.com provide web-based forumsthat list manufacturers looking for buyers.
Specialized magazines on sourcing and overseas sourcing fairsare other ways to find manufacturers. You can also look for tradeleads by visiting http://globaledge.msu.edu, a site created by theMichigan State University Center for International BusinessEducation and Research that provides information on 197 countries,a directory of exporting companies from around the world and freeonline training for first-time importers.
Jay A. Mednikow (eBay User ID: mednikow), president of J.H.Mednikow & Co. Inc., in Memphis, Tennessee, didn't chooseany of these options. Instead, he maximized his jewelrybusiness's unique advantage: customer trade-ins.
Trade-ins make up the bulk of Mednikow's $35,000 monthlyeBay sales, supplemented with consignment items and closeoutmerchandise. The popularity of this refurbished jewelry was sosuccessful, Mednikow, 41, began to use local newspaper advertisingto bring in more trade-in customers. Not only has this line ofbusiness helped build up the company's eBay volume, but it alsoworks symbiotically when trade-in customers use the cash forsomething new from the Memphis store.
Closeouts offer another special advantage, Mednikow says,because after more than five years selling on eBay, he knows how tospot the items that will be most in demand and go for the highestprices. Sources for closeouts and consignments often come fromtrade shows where Mednikow chats with vendors and talks about hissuccess on eBay. "It's a matter of stepping up thosecasual conversations and making them a little moreaggressive," he says. "We ask if they have anythingsitting in their vault that they would love to turn intocash."
This enterprising entrepreneur also makes use of the extragemstones he buys when designing new pieces. Mednikow fits thestones, which don't have much market value on their own, intosimple silver or gold mounts, and those go on eBay, too."There are endless ways to source product when building abusiness on eBay," Mednikow says. "It's an amazingbusiness model."
Work With What You Have
Some retailers are content to stick with what already sells intheir physical stores, using eBay as a sales channel formerchandise that misses the mark with local customers. That'show eBay works for Debbi McGill (eBay User ID:chulavistamojosounds), co-founder of Mojo Sounds, a new and usedCD, DVD and video store in Chula Vista, California. McGill, 39,stocks her music collection with an eclectic mix of bands thatdon't always appeal to the store's regular customers. After30 days without a buyer, unbought CDs go on eBay, where they canreach fans from all over the world. "We have bands you'venever heard of that will sell on the internet," McGill says.The store now has sales between $3,000 to $4,000 a month on eBay,an achievement McGill attributes in part to sales managementsoftware Monsoon Gold.
Alan Iba (eBay User ID: iisports), president of I&I SportsSupply Co. Inc. in Carson, California, is another retailer who getsthe most value from selling items related to his core business ofmartial arts, airsoft and paintball supplies-but not the same oneshe puts on the shelf. Local buyers want the latest and greatest,says Iba, 49, while eBay customers mostly look for items theycan't find anywhere else, including discontinued paintball gunsor collectible martial arts equipment.
Supplying these items is a shift for Iba, who originally usedeBay to unload the occasional customer return or damaged goods. In2004, his Certified Provider, Marketworks Inc. in Atlanta,convinced him to launch a full-fledged online business. To supplythe new operation, Iba had to broaden his base of suppliers. Amongthem are nontraditional sources such as martial arts instructorswho have extra tapes from seminars and want to reach followers inother cities. "Small suppliers were always offering product tous," Iba says, but the company would usually decline. "Wecouldn't pay top dollar for something that might sit on theshelf," he explains. But now, Iba says he can offer betterprices that make the deal a win-win for both, because products movefaster online.
A variety of strategies help make eBay work for growing retailbusinesses, especially those that know how to maximize the value ofany kind of unsold merchandise. "Someone once told me,"says Mednikow, "that the most successful retailers are thosewho have the best endgame for leftover merchandise."