Your primary goal should be to take a clear, sharp photograph (or photographs) that fully displays an item. You also want to shoot your photographs cost-effectively, taking into consideration both time and money. For certain items, you need to present photographs that have an advertising character.
The primary purpose of an eBay photograph is to enable a prospective buyer to easily make a detailed inspection of an item. Such an inspection
is one of the best ways a prospective buyer has to evaluate an item. Therefore, make it easy for prospective buyers. Provide clear and sharp photographs of the items you sell. Another purpose essential to eBay photography is to save you time, effort, and money in doing a necessary chore. You have other important things to do in running your eBay business. You need to spendtime taking photographs of items, but you don’t need to spend any more time than absolutely necessary. You need a workflow that’s efficient; that is, one that provides the highest quality for the least time, effort, and resources.
Good photographs sell items on eBay and help you maximize the sale prices of the items you sell on eBay. Poor photographs are a handicap to eBay sales. Average photographs will generate an average amount of interest for an item and consequently will not bring the maximum number of bidders or the maximum potential winning bid amount. Good photographs go a long way toward attracting a larger number of bidders and thus a higher winning bid amount. Great photographs often bring a winning bid amount that exceeds the expectations of the seller.
There are people who buy items that are accompanied by poor (or no) photographs on eBay, take good photographs of these items, and then resell the same items on eBay for a profit.
Of course, this isn’t cost-effective with $5 items. It’s much more likely to be successful with expensive items where the profits can be counted
not in dollars, but in tens of dollars, or even hundreds or thousands of dollars. But any way you look at it, this seems to me a shocking practice,
one that catches your attention. Don’t let this happen to you.
Here are the key points to remember:
The final step in your creation of a successful eBay business is to set up your own online storefront to offer additional merchandise to your auction customers. If you’re selling printer cartridges, direct your buyers to your online store selling paper and other printer supplies. If you’re selling collectibles, direct your buyers to your online store selling non-auction collectibles. Or, in Caitlin’s example, she can direct buyers of her iron-on transfers to her store selling T-shirts and sweatshirts as well as additional transfers.
Another benefit of selling merchandise in an eBay Store is that eBay will automatically advertise items from your store on the Bid Confirmation and Checkout Confirmation pages it displays to bidders in your regular auctions. These “merchandising placements” help you cross-sell additional merchandise to your auction customers.
Setting up your own online storefront is surprisingly easy to do, thanks to a service called eBay Stores. An eBay Store is an online storefront where professional eBay merchants market fixed-price goods, in addition to their traditional auction items. If you’re a heavy seller thinking of making the move into real honest-to-goodness retailing, eBay Stores is a relatively painless way to start.
You access the eBay Stores home page at stores.ebay.com
Just about any seller can open an eBay Store. All you have to do is meet the following criteria:
Given that accepting credit cards can mean using PayPal, you can see that you don’t actually have to be a big traditional retailer to open an eBay Store. Any individual meeting the requirements can also open an eBay Store, thus making eBay Stores a great way for entrepreneurial types to get started in retailing.
Why would you want to open your own eBay Store? Well, it certainly isn’t for casual sellers; you do have to set up your own web page, and keep the store filled with merchandise. But if you’re a high-volume seller who specializes in a single category (or even a handful of categories), there are benefits to opening your own store. These include being able to sell more merchandise (through your store) than you can otherwise list in auctions; being able to display a special eBay Stores icon next to all of your auction lists; and being able to generate repeat business from future sales to current purchasers.
eBay Stores are great for small merchants who don’t otherwise have a Web presence. They’re overkill for the casual seller, however and probably not worth the effort for larger retailers.
You also have to pay eBay for each item you list and each item you sell just as in a normal auction. The difference is you’re not listing for a (relatively short) auction; you’re listing for longer-term inventory.
eBay Stores also offers a full assortment of listing upgrades, just like the ones you can use in regular eBay auctions. These enhancements gallery, bold, highlight, and so on are priced according to the length of your listing. You can also offer multiples of the same item in Dutch auction format.
Opening your own eBay store is as easy as clicking through eBay’s setup pages. There’s nothing overly complex involved; you’ll need to create your store, customize your pages (otherwise known as your virtual storefront), and list the items you want to sell. Just follow the onscreen instructions, and you’ll have your own store up and running in just a few minutes.
When you’re ready to set up your store, go to the eBay Stores home page and click the Open a Store button. When you accept the user agreement, the store creation process begins. On seceding pages you’ll be asked to choose a store theme, enter a store name and description, provide a logo (or choose from supplied clip-art), and then choose a subscription level. On the last page you’ll click the Start My Subscription Now button, and then eBay will create your store. It’s that simple!
If you’re running a hundred or more auctions a week, you want to draw attention to your auctions. That might mean splurging for some of eBay’s listing enhancements (boldface, gallery, and so on), although these extras typically aren’t worth the extra cost. Better to promote your auctions on your personal website, via message board postings, and in all your emails.
Probably the most important type of promotion, however, is word of mouth based on your good reputation. You want to encourage repeat bidders and drive buyers into your online store (if you have one) for additional sales. That means treating your buyers fairly and with respect, and going the extra mile to ensure their satisfaction. It also means sending previous buyers emails when you have items up for auction that they might be interested in. (Which argues, of course, for keeping comprehensive records of all your eBay auctions.)
Every business should keep detailed records, and your online auction business is no exception. Whether you use an auction management service that offers report generation, a financial-management program like Quicken, or your own homemade spreadsheet or database, you need to track what you’re doing.
In particular, you want to track unit cost and final selling price for every auction you list. You should also track all your ancillary costs shipping, PayPal fees, eBay listing and final value fees, and so on. By tracking all your costs and revenues, you can generate an accurate profit and loss statement, and thus determine how much money (if any) you’re generating from your online auction activities.
It also helps to track information about the buyers of your auction itemsname, shipping address, email address, and so on. The name and shipping address are necessary in case an item gets lost in transit; the email address is necessary not only for auction-related communication but also for promotional purposes which we’ll discuss next.
Managing hundreds of simultaneous auctions is hard work. Most power sellers end up working more than a standard 8-hour day, and more than five days a week. (eBay reports that most of their PowerSellers work anywhere from 10 to 16 hours a day on their auctions!) The time it takes to find new items to sell, photograph them, write detailed item descriptions, post the auctions, send post-auction emails, and pack and ship all those items quickly adds up.
The more auctions you list, the more it behooves you to automate as much of the auction process as possible. For most power sellers, that means signing up with one of the big websites that offer bulk listing and post-auction management, such as Ándale (www.andale.com), SpareDollar (www.sparedollar.com), or Vendio (www.vendio.com). Be sure to factor the site’s fees into your cost structure, and let them help you manage all your auctions.
You should also try to automate your physical auction activity. That means creating some sort of auction “office” or workspace in your home. This workspace should include everything you need in order to create auction listings (including your digital camera and scanner) and to pack and ship your finished auction items. In addition, you’ll need space to store all your excess auction inventory; this may be your basement or garage, or even a rented storage locker.
Automating your processes also means establishing some sort of auction-related schedule. Pick one or two days a week to launch all your auctions; pick one or two days to visit the post office. Stick to your schedule and you’ll avoid running around like a chicken with your head cut off; after all, dead chickens aren’t known for their business efficiency.
On the subject of shipping, you should try to simplify your packing and shipping activities as much as possible. This means limiting the types of items you sell to just a few so that you can standardize on packaging. It’s much easier to stock just one or two different-sized boxes than it is to store a dozen or more sizes. If you sell a limited variety of merchandise, you’ll also be able to better estimate your shipping costs ahead of time.
When you reach this sales volume, you should also investigate the pick-up services offered by many shipping services. Dragging hundreds of items to the post office every week is a lot of work which you want to eliminate, if you can.
Although it’s important to keep detailed records regarding your eBay auctions, generating a few reports is no substitute for engaging an accountant especially when taxes enter into the equation. Remember, any profits you make on your auctions must be reported as income, and you must pay taxes on your income. Unlike in a “real” job in which taxes are deducted from your weekly paycheck, the taxes you owe from your self-run business are paid to the government as quarterly estimates. Trust me, you don’t want to handle this tax stuff yourself. It’s definitely worth a few bucks to have an accountant handle all your business taxes for you and he can probably help you find a few extra deductions, besides.
If you need to be launching several hundred auctions a week, where do you find all those items to list? It’s a simple fact that you can’t become a power seller by listing onesies and twosies. Instead, you need to find an item you can buy in bulk, and then list multiples of that item week after week.
Although beginning eBayers can find items to sell by haunting flea markets and estate auctions, power sellers most likely won’t find what they need in those venues. A better strategy is to approach local retailers or wholesalers and offer to buy 10 or 20 (or more) of a particular item. Buy whatever quantity earns you the best price break as long as you think you can move them.
You can also buy bulk lots of merchandise from online wholesalers and liquidators. We discussed some of these sites in Chapter 11, “Determining What to Sell And for How Much.” Check out Liquidation.com (www.liquidation.com) and Wholesale411 (www.wholesale411.com) to see what’s available, or use Ándale Suppliers (www.andale.com) to hook up with suppliers of specific types of merchandise.
If you’re a serious collector, you might have your eBay business right there. When your comics collection numbers in the tens of thousands, or you have thousands of rare coins filed away in your basement, you’re ready for power selling and power buying. Just remember to buy low and sell high, and you’ll be in business.
Finally, consider the selling price of the items you want to sell and the profit you generate on each item. You have to sell a lot more of a $5 item than you do of a $50 item to make the same amount of profit. (Assuming both generate a similar profit percentage.) And, of course, the more items you sell, the more work you have to do. The most successful power sellers do it by selling higher-priced, higher-profit items, for which the revenues and the profits add up a lot quicker.
How easy is it to turn your online auction hobby into a profitable business? It’s all a matter of volume and good business planning and management.
Let’s consider an example. Caitlin has found a source for iron-on transfers for T-shirts and sweatshirts. She can buy these transfers for $1 each and (based on her experience and research) can sell them on eBay for an average price of $5. That’s four dollars profit for every transfer she sells.
Caitlin has huddled over her copy of Quicken and determined that she needs to generate $30,000 in profit (not in revenues!) to make her eBay business worthwhile. Assuming that she works 50 weeks a year (everyone needs a vacation), that means she needs to average $600 in profit each week. At $4 profit per item, she has to sell an average of 150 iron-on transfers a week each and every week.
Because only about half of all eBay auctions end with a sale, Caitlin knows that to sell those 150 items she has to launch 300 auctions each week. That’s a lot of work, as you can imagine.
Can Caitlin make a go of it? It depends. Can she physically manage 300 auctions a week? Can she pack and ship 150 items a week? And, more important, can she realistically sell 150 items a week is the market big enough to support that sort of sales volume?
If Caitlin answers yes to all those questions, there’s still more planning to be done. To begin with, this example greatly simplifies the costs involved. Caitlin will need to figure eBay’s costs for all those auctions the listing fees for 300 auctions, and the final value fees for 150 completions. If she accepts PayPal payments, she’ll need to determine what percentage of her buyers will use PayPal, and what her fees for those transactions will amount to. Assuming that she uses a third-party website to help her launch and manage those auctions, she’ll also need to figure those fees into her cost structure.
All totaled, these auction listing and management costs can add up to 5%10% of her revenues. That means increasing her cost per item from $1.00 to $1.50 or more which reduces her profit per item to just $3.50. With this reduced profit margin, she’ll need to sell even more items to hit her profit dollar targets an extra 20 or so successful auctions each week.
All this needs to be factored in before Caitlin launches a single auction. And at these volume levels she’s definitely running a business, which means reporting the income to the IRS and paying taxes. There’s also the matter of sales taxes, which she’ll need to collect on all sales made to buyers in her home state.
The takeaway here is that making a living from eBay sales is just like running a business, especially in its financial complexities. Anyone contemplating this type of endeavor should do some serious business planning, which should include consulting an accountant or another financial planner.
If the numbers work out, you need to answer one more question: Is this something you’ll enjoy doing every day of the week, every week of the year? Even if you can make money at it, managing hundreds of auctions a week can wear down even the best of us. Make sure that you’re up to it, and that you’ll enjoy it, before you take the leap.
Chances are you’re just starting out on your online auction adventures learning how to buy and sell and take advantage of everything eBay has to offer. As you gain more experience, however, you may decide that you’re pretty good at the whole thing, and start to wonder what it might take to ramp up your eBay activities. You might even dream about one day making your living from selling goods online.
For tens of thousands of eBay users, making a living from online auctions isn’t a dreamit’s reality. It’s definitely possible to sell enough items to generate a livable income from eBay auctions. It takes a lot of hard work and it’s as complex as running any other business; but it can be done.
One of the steps to running your own eBay business although not a requirement, by any means is to become an eBay PowerSeller. eBay’s 100,000-plus PowerSellers generate enough business to warrant special attention from eBay, in the form of dedicated customer support, premier tools, and the occasional special offer. Plus they get to display that cool PowerSeller logo in all their auction listings.
To become a PowerSeller, you must meet the following qualifications:
The most important point is the first, because it’s the most quantifiable. There are five levels in the PowerSeller program; qualification for each level is based on average gross monthly sales, calculated over the past three months of selling activity.
Note: To keep your PowerSeller status, you have to maintain this sales rate. If your sales drop below these levels, eBay will give you 30 days to bring your account back into compliance; if you don’t, your membership in the program will be revoked. (You’re free to re-qualify at a later date, however.)
That’s right, there are some eBay sellers who average $150,000 or more a month. That’s almost two million dollars a year in revenues from eBay auctions no slight accomplishment!
Membership in eBay’s PowerSellers program is free. However, you can’t apply; PowerSeller status is by invitation only. Each month eBay sends out invitations to sellers who meet the PowerSeller criteria. You become a member by (1) meeting the criteria; (2) receiving an invitation; and (3) responding positively to the invitation.
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