This chapter is from the book
This chapter is from the book
This chapter is from the book
How to Become a Bulk Reseller
If bulk reselling sounds good to you, don’t get out your checkbook just yet. First, make sure you have the physical space and systems to cope with an onslaught of not-yet-sold merchandise. If you intend to store all that stuff somewhere in your house, make sure you (and the rest of your family) can really spare the room. If you have to rent additional warehouse space, factor those costs into your business plan. And wherever you decide to put it, make sure you’re up to the task of tracking all those individual items.
When you’re making this size of upfront commitment, it pays to do a little research beforehand. You need to identify a product category that is robust, that has a high sell-through rate, and that has some legs. That means searching through recent eBay auctions or investing in an online research tool, such as those offered by Ándale (http://www.andale.com). You’ll want to track sales trends (by category) over time, close rates (the percentage of auctions that end with a successful bid), and final selling prices. Use that information to guide you toward the types of merchandise to purchase.
Then it’s a matter of seeking out the best bargains. Hit all the closeout and liquidation sites, and see what’s available. Bide your time; there’s no reason to jump at the first offer you see. Avoid the temptation to shop by price only. The lowest price isn’t always the best deal; sometimes you’ll have more success selling slightly higher-priced (and more well-known) merchandise. In other words, become a savvy shopper. When it comes to bulk reselling, the better you are as a buyer, the more successful you’ll be as a seller.
Seller Spotlight: rosachs
There’s money in shoes. Well, not literally inside the shoes, but rather in selling them—as eBay seller rosachs knows quite well. Rosachs is Robert O. Sachs, a seller located in Memphis, Tennessee. He sells shoes—and lots of them—in eBay auctions and via his eBay Store, My Discount Shoe Store (stores.ebay.com/My-Discount-Shoe-Store), shown in Figure 3.3.
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Figure 3.3 Items for sale at My Discount Shoe Store.
Bob got started selling on eBay when his wife started complaining about his growing collection of "stuff." Like most of us, Bob’s first sales were those items lying around the house that he didn’t really need. When he got into collecting (and buying and selling) limited-edition Pepsi bottles, he was hooked.
Today, Bob is a bulk reseller of overstock shoes of all styles and sizes, and as he’ll freely tell you, it’s a hot category. He reached bronze PowerSeller status after just two months of selling shoes online, and his sales keep going up month after month.
Bob got into the shoe biz as an offshoot of his ongoing Trading Assistant business. He received a call from a gentleman who wanted him to sell some old personal electronics items, and when he went to pick up the merchandise, Bob discovered that the man worked for a shoe wholesaler. One thing led to another, and before long, Bob had signed an agreement to sell this company’s excess stock on eBay. Bob’s been at it for a year and a half now, and he’s up to $3,000 in monthly sales. (Figure 3.4 shows the kinds of merchandise that rosachs offers for sale on eBay.)
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Figure 3.4 One of rosachs’ shoe auctions on eBay.
What’s unique about Bob’s business is that while he’s selling in bulk, he’s not necessarily buying in bulk. In most cases, he’s actually selling on consignment for the shoe wholesaler. This arrangement relieves Bob of any financial obligation, since he doesn’t have to buy the products he sells. It’s a good example of how many eBay sellers operate under a blend of different business models.
Bob does buy some merchandise in bulk, however—and passes on some, as well. He told me how he recently received an offer to buy 144,000 pairs of new overstock shoes from an overseas manufacturer. (That’s a lot of shoes!) Bob had never heard of these particular shoes before, so he did a little research. He found that dozens of these shoes were listed every day on eBay, yet only one or two pairs were selling—and they weren’t bringing the best of prices. Bob did a quick estimate of how many of these shoes he could reasonably expect to sell per week, and discovered that it would take him years to sell off the entire inventory. He passed on the deal.
Currently, Bob likes to keep about 600 pairs of shoes running on eBay at any given time, with about 500 of them running in his eBay Store as Good ’Til Cancelled listings. He lists about 10–20 items per day for auction, and what doesn’t sell is relisted—either in the store or on the main eBay site. All his eBay auctions include the Buy It Now option, and he averages about 23% sell-through.
Right now Bob’s eBay business is a part-time endeavor for him, but he’s considering taking things to the next level. Here’s what he says about the business: "Everyone thinks that selling on eBay is super easy, and it is if you are only selling a few items to clear out a closet or straighten up the attic. But when you get down to serious day-in, day-out selling, shipping 2–3 times a week every week, dealing with returns, answering the same questions from buyers over and over—it’s a whole ’nuther ball game! You have to consider how much time you have to work your sales, how much space you have to store your inventory, how to properly price your shipping (boxes, peanuts, and tape aren’t free!), and how to make time to find that next client, who is just as important as your current client."
He advises other potential sellers to "play it smart—keep an eye on your true costs and make sure that what you are paying yourself for the work you do is an acceptable wage." As he notes, if you work 60–70 hours a week at selling (and that isn’t unheard of) and at the end of the week you have only $50 in profit to show for it, something’s not right. Going big-time should mean a big-time payback, or you’re not managing your business right.
Given the kind of volume he does, Bob is a big fan of auction automation. He uses Seller’s Assistant Pro to list and manage his auctions, and it helps to keep him organized by tracking his listings, sales, and inventory, for a small monthly fee. As he says, "automation allows me to spend time working on what I’m selling, not how I’m selling it." It takes over the mundane chores that suck the fun out of selling on eBay.
Bob also counsels other sellers to take advantage of all the free resources that eBay offers—the discussion forums, workshops, and the like. I first met Bob on the Seller Central discussion board and can attest to how useful these forums are. And when you visit, say hi to Bob!