Secrets of the eBay

CHAPTER 3: Connect with Your Customers 55
He started looking at eBay as a potential market for his employer’s
safety footwear and protective clothing products. “I remember thinking,
I wonder if there’s a market for selling other things on eBay. I spent weeks
scouring the Internet, looking at every market and dozens of B2B web
sites. I always wanted to buy a nicer pen than a BIC. I bought a Parker
Jotters I used to pick up for around $2. The interesting thing that struck
me was the Montblanc Writer’s Edition ballpoint pen. The first one ever
produced was named after the writer Ernest Hemingway. I found an online
distributor who had 550 pieces left over in a warehouse on Long Island.
I bought one as a trial and put it up for sale on eBay. It sold for $450. Then
I made a deal to buy 150 of them with an option to buy the remainder in
30 days. I had them shipped C.O.D. I wasn’t home when they were delivered
so my wife handed the UPS driver a check for $27,000, but only after she
insisted on opening every box and making sure the pens were actually in
there. I started selling them through Thanksgiving of 1999. I sold them for
$400 to $500 each.”
The story sounds pretty straightforward, but there’s more to it than
meets the eye. Drew did a lot of work to begin with. He investigated eBay
for hours on end during his personal time; then he experimented with
some trial sales. He hit on a product that was easy to store and ship. “You
have to evaluate the marketplace and decide on a strategy,” he explains.
“Now, I saw on that deal a good profit margin. Pens don’t take up a lot of
space. These things were sold in limited edition quantities. I decided to buy
enough so I could effectively corner a market.”
After selling Montblanc pens for a while, he got to know the marketplace
better, and hit on a brand of pen that was even harder to find and sold in
smaller quantities. There was also the chance for an even bigger profit
margin. “The company that makes Michel Perchin pens was located in
St. Louis. I flew to St. Louis and had a meeting with the owner. I was
fascinated by his pens. They were beautiful objects made from precious
materials in countries known for their craftsmanship. There was English
sterling silver engraving and enamel. The pen nibs were made in Germany
from 18K gold.”
Perchin pens aren’t sold as widely as Montblanc; they are found
primarily in pen stores and are also sold by retailers who specialize in
writing implements. The Perchin web site (http://www.michelperchin
.com, Figure 3-2) doesn’t offer pens directly to the public. In other words,
it’s an ideal situation for an enterprising eBay seller.