Secrets of the eBay

10 Secrets of the eBay Millionaires
off developing your own sales niche. As one PowerSeller told me: “Too
many people try to do what everyone else does. You already have 10 or
20 people selling computer equipment on eBay. New people look and think,
‘I can do that, too.’ They find out right away that they can’t compete with
sellers who have built up a business over time.”
It’s tempting to start out with an approach along the lines of, “I’ll find
the two or three things that are sold most often on eBay; since that’s what
people want the most, that’s what I’ll sell.” There are several problems with
this “copycat” reasoning:
● Stiff competition If something is already being sold heavily on
eBay, that indicates that some sellers are already heavily involved
in offering that type of merchandise online. You’re likely to encounter
a wall of competition.
● Lower feedback Customers who are used to making purchases
from sellers who have higher feedback ratings (and by extension,
more established reputations) than you do will be unlikely to
switch to a less-established seller like you unless your prices are
substantially lower.
● Potentially low margins If there is already heavy competition for
something being sold on eBay, chances are the profit margins are
already very small: The existing competitors are driving each other’s
prices down. In order to have any hope of attracting customers, you
would have to cut your profit margin to a razor-thin level. (And the
manufacturers or wholesalers that provide you with inventory to
sell might not approve of this; they may accuse you of undervaluing
their products and hurting other authorized sellers.)
The challenge is this: finding something that people want on eBay but
that isn’t already being sold extensively on the site. Such items still exist.
For instance, I collect fountain pens. I love just about everything having to
do with fountain pens. However, starting a big fountain pen business would
probably be a bad choice for me—that is, unless I could find a particular
limited edition brand of pen that isn’t being sold on eBay, as PowerSeller
Drew Friedman did (see Chapter 4). The market is already covered by many
established sellers. However, there are fountain pen and writing accessories
such as carrying cases and ink that aren’t being sold extensively on eBay
(at least, not at this writing). I would be much better advised to try to sell
ink and accessories rather than writing implements.
Even if you find something that is in demand and isn’t sold by lots of
others on eBay, you also need to make sure you can supply them on a steady
basis, and that you can make a profit selling them.