Part
Time Selling:The
eBay®
& Amazon®
Business
Start up Guide
What
to do BEFORE You Start Selling Online
From
the Author of
Jason
Guarino's web site, blog, and places to buy his eBooks & paper
back books can be found at PartTimeSelling.com. He welcomes comments
and suggestions by email at info@PartTimeSelling.com.
Copyright
©
2012
PartTimeSelling.com
Introduction
The
purpose of this short guide is to the provide the basics of setting
up an online business with eBay®, Amazon®, or any online
marketplace for long term profit. It is part of my Part
Time Selling series geared
toward helping people to become an Online
Selling Pro.
This
guide will educate you and give you the information that you need to
know BEFORE you begin. Many online sellers have no idea where to
begin but need a road map for the basics. If you have ever wondered
what is involved to get started with becoming an Online Selling Pro
but have no one to talk to, then this guide is for you.
Unlike
other books that tell you how to run your eBay® business, such as my
book Part Time Selling: 90Days to Online Success by Selling on eBay® & Amazon®,
this guide will give you a good idea of what is involved to break the
ice and get started. Use this guide not only to gain knowledge about
what you will need financially, but to help you decide if becoming an
Online Selling Pro is something that is right for you. If you have
already made the decision to start selling online and you are set up,
then I would again suggest my book mentioned ahead of time. My book covers how to become an eBay Top Rated Seller and Amazon Featured Merchant. It also discusses proper product sourcing by learning how to find product to resell on eBay & Amazon.
I
have been asked countless times from friends, family, and strangers
about my business. When I begin to explain my daily process, I see
the same reactions. Usually they are puzzled because they didn't know
exactly what was involved. There is a massive misconception that it
is easy to do. Well, I am here to tell you that it is hard. Not the
hardest business in the world to run, but absolutely far from easy if
you want to be a long term success.
The good news is this is
not impossible. Education, training, making mistakes, along with
plain old fashion experience can yield the Online
Selling Pro within you. I
encourage you to use this guide to help you understand what you need
to do before you start selling.
After
reading this guide if you decide you want to take the next steps, I
would encourage you to pick up my book PartTime Selling: 90 Days to Online Success by Selling on eBay® &Amazon®. It dives deeper
into the next stages of selling online such as product sourcing,
customer management, and branding your online image to reach the top
selling tiers offered by eBay® & Amazon®. Then one day when
someone asks you what you do for a living, you can explain and see
the same reactions from your friends and family that I have seen for
years. This is when you will know that you are now an Online Selling
Pro.
Selling
on eBay® is a business. Like any other business, it requires not
only the right type of person, but the resources to get going and
maintain a steady cash flow. Anyone who is considering selling on
eBay® needs to understand this. Long term success on eBay®,
Amazon®, or any selling platform does not yield immediate success.
You must lay out a business plan or strategy.
eBay® is
different from a traditional retail store in many ways. There is a
massive amount of flexibility with your customer base and customer
service. Regional demographics really are not an issue as your
customers are world wide. While your traditional retail store is
usually closed in the middle of the night, you may get most of your
world wide sales while you are asleep.
This is
where the similarity ends. I am here to tell you that if you do not
treat your eBay® business as a true business venture, your business
will result in failure. This is the same failure a retail store will
experience that is not set up or run correctly.
Even
though a retail store and eBay® are different in functionality the
core concepts for success are still the same. They take slightly
different roads to reach them. Becoming an Online Selling Pro is
straight forward but can be a challenge. Yes, some concepts are
common sense, but many are not.
Quick
Note
eBay® is by
far the most well known source for anyone to sell online. However
there are many other sites like Amazon®, Sears Market Place,
Buy.com, and Etsy.com to name a few. When I use the word eBay® in
this guide, it should be understood this also means any place that
lets you sell your items online.
Again,
I want to point out this is a short guide. It is not a full length
book that discusses the specific details like Part
Time Selling: 90 Days to Online Success by Selling on eBay® &
Amazon®.
Think of this guide as a 30 minute consultant meeting giving you the
big picture and letting you know what is involved.
What
is Covered
Money
: How much do you have?
Product
: Can you get it?Time
: Do you have the time to
run your business?The
Start-up : All
the basics you need to have in place
Money
Money
is a major factor in establishing any business. As mentioned, many
people think as an Online Selling Pro you buy and sell without much
more beyond that. Well, there is a money factor. As a retail store
owner, you will need to buy inventory, promote your business, and
wait the several months or even years in many cases before yielding a
profit that you can pull a paycheck from. If you are flat broke
living paycheck to paycheck with no savings, you will not have the
resources necessary to get off the ground. If you think otherwise you
are only fooling yourself.
Online
sellers tend to yield profit faster than a retail store because you
don’t have the overhead of a retail environment. But you still need
money as part of your foundation. Did you know that eBay® may hold
your money up to 3 weeks as a new seller? What about the product
source? Do they always stock the items you will need or do they often
run out forcing you to buy a few months worth of inventory at a time?
Do you have the hardware and supplies necessary to take care of your
customers orders?
Your sales will not be an instant success
and will take time to build. The slow momentum in the early stages
may drive you nuts if you sit there watching every order trickle in.
If you have to worry about money because you are not properly funded
then you can count on a great deal of anxiety and stress in your
life. These never have a positive effect on your personal life or
business.
The
money part comes down to 2 things. Resources & paying yourself.
Resources.
Having the resources to get off the ground during the beginning is
vital. Not only because of eBay® holding your money, but because of
the potential struggles and learning curve you will encounter. Once
you project sales, I would suggest a 2-3 month buffer. Yes, I am
suggesting that you bankroll enough money to keep 2-3 months worth
of inventory in stock in addition to all your starting & running
expenses.
Taking
a paycheck. Do not take a dime from your business until it is ready
to give it to you. While each business setup is different, follow
this general rule. When your business reaches a point where it is
yielding a profit and you can take a paycheck, don't. Keep track of
this potential to take a check. When you feel comfortable after a
certain time frame, say several months, then go for it. This will
help prove stability in your business and a wise choice when
considering changing your existing career. Be be patient before
considering making changes to your day job.
Why
take the precautions? Simple, to make sure that you know what you are
doing. Being a business owner, regardless of the business type takes
a certain type of person. Some individuals can be a doctor, lawyer,
contractor, or artist. It is in their blood and is all they know and
love to do. Trying to make an artist into a doctor may have
disastrous results. Trying to be a business owner when you are not
this type of individual in your heart (or not ready) can be just as
disastrous.
This
approach will help ease any emotional or financial pain if things
take longer than expected or don't work out. It will also give you
something to think about before starting.... Is
selling online really for me?
Product
Product...Product...
and more Product. In my book Part
Time Selling: 90
Days to Online Success by Selling on eBay® & Amazon®,
I describe sourcing methods including how and where to find product.
In this guide I will discuss product strategy and diversity.
Do not
be a one trick pony. You need to diversify. When you walk into an
auto parts store, they just don't sell parts to repair your car. Look
around and you will see detailing equipment, clothing, branded key
chains, and even snacks and soda. They will have several hot key
items that are their most profitable consistent sellers. They will
then have their mid & low range volume product scattered around
the store.
What happens if one of their hot sellers cannot be
supplied any more? For any number of reasons they cannot get their
hands on this particular product. Do they close up shop? No, they
have others to fall back on.
Whats the point? Check out these
sellers and examples.
Seller
“A”
Seller A is an eBay® seller moving ink jet cartridges. He
has a great source for getting aftermarket (Non factory branded) HP
ink jet cartridges. He is moving 150 a week and making a consistent
great profit on them. Seller A doesn't really sell much of anything
else.
Seller
“B”
Similar to Seller A, Seller B moves the same amount of HP
Ink jet cartridges and sources them from the same supplier as Seller
B. Seller A also sells Epson Cartridges sourced from another supplier
and Lexmark Cartridges from another. Additionally since he is
catering to customers who need printer supplies, he stocks USB
printer cables, replacement power cables, and printer cleaning
equipment.
Next
week Sellers A and B call their HP cartridge supplier only to find
out he is out of stock and will be for a month at least. What
happens? Well, Seller A is going to lose out on a months worth of
sales. Seller B will also take a loss too, but since he is
diversified, he has a much better chance of riding out the time until
the supplier is restocked without a major financial hit.
The
point of the story is that if you put all your efforts into this one
product and source, you are going to have issues if they dry up.
There are zero guarantees that your source will always have these or
that the cartridges that you are selling will not drop in demand.
Seller A will start to scramble to find a replacement product. This
takes time not only to find it, but to order and receive it. A week
or two may pass before he can even begin selling the replacement
item. Since Seller A has no sales history with this product type, he
may not get the best exposure on eBay® when he starts to sell them,
yielding a slow start to his sales.
Time
Time is
the one luxury in life that we cannot control. No matter what you do,
you cannot buy more time. You have no control over your life's
events. You may have all the time in the world as a single person
working a regular job. You may have practically no free time because
you work 6 days a week, are married, and have 3 kids. Time and effort
are necessary to be successful in anything. If you want to learn an
instrument or pick up a hobby, you need time to learn these
things.
What if you want to become an Online Selling Pro but
have limited time because of the nature of your daily life
activities? You need to do two things. You need to commit the time
and you need to leverage your time.
Committing
your time is straight forward, simply do it! Regardless if you are
single and working 100 hours a week or married with kids and working
40 hours a week, there are going to be points where time will be
difficult and limited.
As your regular job has a set schedule
of time, you need to make the same set schedule for your online
business. In the beginning this may be hard to nail down as you will
have no idea what kind of time you need to commit. Once you have a
rhythm down for your routine, you will have a greater understanding
of the time you need to commit to your eBay® business. It will get
easier as time goes on.
Leveraging your time is about making
your efforts pay off for you in multiple. When you sell a product do
you want to put in X amount of effort to only sell one of them or do
you want to put in the same effort and sell 100 of them?
When
selling an item on eBay®, you need create a listing. This listing
process can take time, especially if you are new. When you have a
number of individual listings that you need to make, it becomes more
beneficial to leverage your time by getting involved with products
that you can buy multiples of. This way if it takes you 10 minutes to
create a new listing, it's worth the time because you would have 20
of them to sell instead of only one.
If you don't leverage
your limited amount of time, your business can fail because you
cannot dedicate time to its growth. Stress will kick in and you can
get sloppy with your work, lose faith in yourself and your efforts.
If you are limited on time for any reason, I would strongly suggest
focusing your efforts by sourcing product that will allow you to
leverage your time. You will be thankful, especially when you are
getting started and are not familiar with everything going on.
The
Start-up
This
start-up is an overview. Every eBay® business is different, unique,
and each owner has different visions. Use this overview to help guide
you and fill in the blanks for those that need a bit of help.
Some of
these are common sense, and any seasoned seller could look at this
and say “I already knew that”. Use this list to get a picture of
the resources that you will need in place. My goal here is to paint a
picture for what your shipping area will look like.
Hard
Goods
Shipping
supplies: Once you know what you will be selling you need to get
shipping supplies (packaging) that work with that product. This
includes boxes, bubble envelopes, or what ever you may need to ship
your product safely. Keep in mind if someone orders two or three of
something you will want the packaging to match that. Don't forget
the bubble wrap or foam popcorn.
Shipping supplies also
include package tape, tape gun, box knife, markers, pens (I suggest
one attached to a line and desk), customs pouches to hold
international labels, and scissors.
Don't
go to your local office supply store to get these items, you will be
paying high retail. Google your local area for a box manufacturer.
Connect with them and expect savings up to 90 % off MSRP.
Computer:
This goes without saying, but any decent computer made within the
past few years will run most of the applications out there. I would
suggest a PC. Nothing against Mac's, but the reality is most of the
hardware and software out there is geared toward PC's.
Ink
jet or Laser jet Printer: Mostly for packing slips or printing
shipping labels if you want to go this route. Using these printers
to make your labels can be extremely expensive.
Label
Printer: A much better choice for printing shipping labels. The most
popular model is the Zebra LP 2844 which uses a roll of common 4”
x 6” labels. These are the sizes that UPS, USPS, and FedEx use
with many of their respective programs. The benefit of the label
printer is the roll stays with the printer and you don't need to
swap out the paper for label paper as you would in an ink jet.
You
can find this printer pre-owned for about $ 125 on eBay® and the
labels at a good price from many online resellers.
Other
Considerations
Here
are a number of things you should consider before becoming an Online
Selling Pro. They are in no particular order.
Taxes!
I would preface this by suggesting that you consult with a tax
professional before making any financial decisions. Any online
retailer is now required by US law to report via a 1099 your gross
revenue for any online seller that exceeds $20,000 a year in gross
sales. You have the option of giving them your social security
number or your business tax number if you are a registered business
with the IRS.
Keep
track of every expense for your business. Not only receipts for
supplies, but for losses. What if you mix up an order or your item
arrives broken? You not only may have a loss for the item itself,
but for the shipping expense involved. These small expenses can add
up fast but can be a deduction on your taxes.
Patience..
and more patience. Especially in the beginning, things will be slow.
Don't sit there and hit refresh on your account every 5 minutes
wondering if any orders came in. If you have this kind of
personality and cannot “walk away” to let the business do its
thing you should consider learning how to deal with this before you
start selling. It can take many months before you see a consistent
sales trend.
Conclusion
I
hope you have found this short guide helpful. My goal was to give you
an idea of what is involved to becoming an Online Selling Pro and to
determine if this is a path for you.
If you feel as though
this is something you wish to get involved with and want to learn
more, I would suggest getting a copy of my book Part
Time Selling: 90 Days to Online Success by Selling on eBay® &
Amazon®. It covers many
hot topics such as product sourcing, providing the level of customer
service that eBay® & Amazon® wants their sellers to provide,
and reaching the top selling levels giving you the best exposure to
buying customers.
You can see where to purchase my books and
more details at PartTimeSelling.com.
I can be reached at
info@PartTimeSelling.com and I always welcome questions you may have
about becoming an Online Selling Pro.
I
appreciate your purchase and interest in my work.
-Jason
Guarino
