Since June 2nd, 2010 I have been selling on eBay and it has been quite the learning experience.
I started using eBay out of necessity. While planning our wedding, I ended up buying two wedding dresses for my wife and she only ended up using one. I turned to several places to try to sell it: Craigslist, Facebook and more than one wedding planning forum. In the end, eBay worked, where all other online markets failed. Since then, I started using eBay to sell goods to people in the United States and the rest of the world. Here are the 5 top things I have learned from selling on eBay since 2010.
I started selling off my CD collection. Since I discovered how to use a mp3 player back in 2004, I had little by little start using CDs less and less. So, they had to go. After a couple of months, I started experimenting with DVDs. While looking for cheap DVDs on Craigslist, I found a movie collector that was giving away hundreds of VHS tapes.
That was the best decision I ever made on eBay. Through that nice “accident”, I was able to find my niche: VHS tapes. The reason why VHS tapes work for me is threefold. First, I am able to find lots, lots, lots of VHS tapes in the Hawaiian Islands, so I have a steady supply. Second, given that Hawaii has a large Asian population, I am able to find a lot of rare imports from Asia. While those tapes may be a common commodity here, they are considered rarities in the U.S.mainland. Finally, VHS tapes are easy to ship via USPS.
Many people think that I’m crazy selling VHS tapes and I love that! Not only allows me to be the sole supplier of a good, but also it allows me to have a head start over other seller.
2. Focus on Lowering Your COGS.
Accounting 101: COGS stands for Cost of Goods Sold. For me, the right COGS is the one that looks like this:
That’s not a typo. I don’t like to have COGS other than the ones that I cannot control such as shipping, packaging and paying to the eBay man.
Every now and then I hit up clearance sales to score some nice goodies that I know that will sell, but my major sources of supply are free. Most people are happy that I help them to get rid of their VHS tapes, for them I am taking a load of their hands. I am happy to help them and get goods for free.
Buy low, sell high. It works for eBay as well.
3. Do Your Do Due Diligence When Pricing.
eBay loves telling you to price everything at $0.99.
Don’t do it.
Instead research the price of your goods on Google and Amazon. You will get a better idea of what they are truly worth it and how high you can sell them. The key to a good negotiation is that you know what is the minimum price for a transaction to make sense for you. Don’t be afraid to stick to that minimum price. While you may not get mega rich from selling goods on eBay, you want to make sure that you lose money.
4. Ask For Feedback.
Through the years I have met all kinds of eBayers. From traders of vintage Barbie clothing to baseball cards, I have seen it all. Some of them rock are rocking eBay, yet they get very little feedback. BTW feedback on eBay looks like those stars next to your profile, as this article was written I had 208 stars.
Often I asked them, “why do you think that you’re not getting feedback?” And their answer is always the same: “I think it is because I don’t ask for it.”
This is a wasted opportunity. Make it a habit to setup email updates to know when the item arrives to your buyers and send them an email notifying them that the tracking number indicates that the item has been delivered. Thank them again for their purchase and mention that you welcome feedback on your eBay profile. From personal experience, that ends up 90% of the time in a star within 2 days.
This is your chance to find out what you’re doing really great and share it with potential buyers. In my case, people love how fast I get them their goods, even if its from Hawaii, check it out:
eBay points out that feedback is an important part of the eBay community because it lets people know about your performance as a seller. The higher your feedback, the more buyers will consider buying from you.
5.Always Ship with Tracking and with Insurance, when applicable.
Why do people don’t mail $50 dollar bills? Duh, because they can get lost.
Not to mention that there’s nothing you can do about it.
On the other hand, when sending a good worth $50 bucks there are two things that you can do:
1) Ship with tracking. Even USPS offers that option.
2) Insure goods.
I always ship with tracking because it allows me to protect myself against any buyers that would claim that the good never got there. I believe in giving people the benefit of the doubt, but I prefer to avoid any weird scenarios. If you ship with tracking, you know where the good is….and you qualify for seller protection.
As for insuring goods, I would recommend to set yourself a limit that you’re comfortable with. Me? I’m not ok with losing anything over $30, so that is my limit. If the item is over $29.99 I always insure.
If the item is over $100, then I also request that a signature confirming delivery must be obtained. I did this with the wedding dress and with a Macbook Pro I sold over eBay. On both cases, the buyers mentioned on the feedback how happy they were that I had requested signature and provided insurance because that gave everybody peace of mind. Win-win.
Conclusion and Summary
So to summarize, here are my 5 lessons from selling on eBay since 2010:
1. Find your niche and own it! The less competitors, the better.
2. Aggressively find ways to lower your COGS. Remember to buy low and sell high.
3. Use Google and Amazon to find the right price for your goods. Stick to a minimum price for your transactions.
4. Feedback is a crucial motivator for buyers to complete a purchase. Make sure to follow-up with your buyers and encourage them to leave feedback on your profile. Don’t be a pest, just ask once politely.
5. Always ship goods with tracking to avoid any misunderstandings with your buyers. Also, find a minimum limit, which makes financial sense to you, to insure your goods. Better safe, than sorry!
What do you think of these lessons? Do you think I missed any? Let me know on the comment section below.