Starting an eBay Auction Business

By Prev Info - October 17, 2022

 An eBay auction business allows you to sell merchandise online, using the largest online auction site. Because eBay brings in so much traffic, small business owners generally don't need to market their items outside the site. Millions of people search eBay every day looking for interesting items at reasonable prices. By choosing the right items to sell, pricing them appropriately and offering good terms to buyers, an eBay auction business has every chance to succeed.

Starting an eBay Auction Business

Choosing Items

Every eBay business sells different items, leading to the great diversity of items for sale on the site. While there's no right or wrong way to choose items to sell, following a few guidelines can make it easier. Unless you plan to sell items that buyers have to pick up, such as cars or large furniture, keep the overall size and weight of the items in mind.

 A heavy item costs a lot to ship, and a higher shipping price cuts into your profits. Buyers on eBay want bargains, and the price of shipping is factored into the overall price of the item. A very large item, even if it isn't heavy, increases shipping costs because of the price of boxes and other packaging materials. Many shipping companies also have a surcharge for over-sized items.

Also consider the fact that many items are simply over-saturated in the market. When you get an idea about something you'd like your business to sell, check how many of these items are already for sale on eBay. If there are a lot of them, your price will have to be competitive, cutting into your profits. Choose items that are either unusual, interesting or always in demand. Clothing in unusual sizes, books, children's toys and craft supplies are always good sellers.

Selling on eBay

When you set a price for your item, you have two options: either set a minimum bidding price and allow bidders to raise the price, or give the item a fixed price. Some people choose fixed price because they like the chance for a quick sale or because they will only accept a specific price. Others like the unlimited price of the auction format, which can raise a price considerably if there's high demand. Whether you choose fixed price or auction formatting, list each item with a title, description and a clear photograph.

Set a shipping price that will cover your shipping costs. Many sellers also add a handling fee to help cover the cost of shipping supplies. Once you list the items, you may need to answer questions from buyers. Otherwise, there's nothing more you need to do until the listing is over and the buyer pays.

Setting Up the Space

An eBay business needs a dedicated physical space, even if it's a small business. One mistake that new sellers often make is listing items for sale and then losing or damaging the items. This can result in a bad feedback rating, making it much more difficult to get your business going. Create a space that will store your items efficiently. A space that will accommodate both your inventory and your packaging supplies is usually best. While some sellers store eBay items in garages and sheds, this often leads to mildew, dirt, dust or insects damaging the items.

The shipping supplies that you need to store include boxes of various sizes to accommodate the items you sell, bubble wrap for any delicate items, padded mailers for items like books or CDs and foam peanuts to fill the spaces in large boxes. Your business will also need a digital camera that can take clear pictures of each item.

Setting Up the Business

The way that you structure your business will likely depend on the area where you live and the type of items you sell. Many people sell on eBay under a small business license that they get from their local county courthouse. In other areas, a small online business doesn't need a license, and the income can be counted as miscellaneous income on a tax return. Find out what your area requires before you start an eBay auction business.