Archive for selling on Amazon

The eBay Numbers Game

Avril Harper is well know as a successful seller on eBay based in the UK.  She also wrote the successful eBay Confidential.  One of her ideas is that eBay is, essentially, a numbers game.  The more you list the more you sell.

It is more complicated than that of course but she estimates that a maximum of two out of three listings fetch bids first time arround.  The remaining items, when relisted, again sell two out of three, and so on.  As long as you know your exact costs and profit margins this is a very good way to test new products.  In fact knowing your full costs and profit margins is key to selling successfully online be that on eBay, Amazon, or any site.

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Profit Margins

Sell successfully online

Sell successfully online

Sam from Hong Kong has asked me about my last post.  He wonders if I ever deviate from my rule that I want to make 200% profit from goods I sell on eBay and Amazon.

He thinks that I am looking for too much profit and that if I bought with a lower profit margin in mind I would sell more and so make a greater overall profit.

I do deviate from the 200% profit rule if I know that the goods will sell easily and quickly.  I have to take a lower profit on my main ebay line as it is price sensitive.  Others are selling the same line of goods as me and I beat them on price and my feedback alone.  So my margins are lower but the stock turn around is quicker.

Assume that a widget costs you £100 and that you stand to make £5 gross profit but it takes a year to sell.  If you had that money in a bank you could have made £5 in interest and it would have been safe, no risk of losing the money (assuming that our governments continue to underwrite the banks).  In this case why bother risking the money in stock that you may not sell?  You would be better advised to leave the money in the bank (remember, you need to deduct all shipping and fees from the gross profit).  If your gross profit was £200 for stock that costs you £100 then, obviously, buy the stock and try to sell it.

However, if you can buy 20 widgets at £5 each selling them all for a net profit of £3 each in a week and keep buying new ones to sell every week then a lower profit margin makes sense.  That is about turnover and I will talk about that in a later post.

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Condition is everything!

Sell successfully online

Sell successfully online

The other week Jane and I went away for the weekend (it was lovely, thanks for asking).  While we were enjoying a very brisk (i.e. cold) weekend on the North East coast of England I found a copy of a book called The Letters and Diary of Kathleen Ferrier that was in excellent condition, except for one thing.  The frontispiece had been torn out of it.  If it was intact it would have been worth £40, with this damage it was worth £6.  As I paid £1 I still made a nice profit on it (at least in percentage terms).

However, it got me to thinking.  My two general rules of thumb are never to pay more than 1/3 of what I think I can sell any item for and only buy items in the best possible condition.  This ensures that I make a reasonable profit and that I do not have too much of my working capital tied up in slow moving stock.  It also ensures that a collector interested in what I am selling will always consider my stock and come to trust me as a seller.

Selling goods in good condition helps to build both my profit and reputation.

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Amazon and eBay the Race Becomes Closer – selling online

Sell successfully online

I read a couple of interesting things recently.  The first is an article on about John Donahoe the CEO of eBay and the driving force behind the recent (and dramatic) changes to eBay.  Read it here. The second thing I read was about some research done by Channel Advisor.

We all know that times are hard, we have seen the recession coming from the first time the scandal of people who could not afford it borrowed from those who did not have it broke.  So it comes as no surprise that the rate of growth in online sales has declined.  Channel Advisor says that in the third quarter of 2008merchant sales at Amazon was up by 45% (year on year) and eBay’s by 7%.  Time says that eBay has 84.5 active users and Amazon 81 million customers.

What does all this mean?  The my main conclusion is that Amazon is catching up eBay very quickly (remember that that 45% growth comes from a smaller base line) but that eBay is still ahead, at least for now.  Now more than ever can you really afford not to look at selling on Amazon as well as eBay?

My second conclusion is that the Channel Advisor figures explain why Donahoe has been acting so quickly to change the cost base and direction of eBay.  Will his changes work? we can only wait and see.

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Somedays are better than others (2)

Today I opened up my email to find a string of “Sold Now Despatch” emails from Amazon.  Very nice.  Checking eBay and the same thing!

I have to say that over the last few weeks I have found that going to car boot sales at 7a.m. on freezing Sunday mornings a bit dour.  Sometimes turning over and going to sleep again was very tempting.

Selling successfully online is not easy.  Anyone who says that it is probably does not do it.  Online selling is great, as we all know, but demands that we keep a focus on what we are doing and why.

There are 4 things that we need when we embark on a successful selling career online.

1.                  Honesty, only if we are honest, to ourselves and our customers, will we succeed.

2.                  Good products.  Sell tat and you will fail.  Always strive to sell better and better goods.  Not necessarily more expensive goods but better quality.

3.                  Tenacity.  Turn over on Sunday mornings and you can kiss your successful online business goodbye.

And, last but by no means least;

4.                  Vision.  More specifically, a vision of why you are selling online.  What do you want and why?  Take time to write down why you are selling online.  Be as specific as you can be.  Do you want to quit the day job?  Do you want to make £1,000 in 10 days?  Do you want an extra £500 a month?  All are possible but you need to know, understand and believe your real motivation.  If you do not know why you are doing something you will stop at the first obstacle.  If you do not have a target how do you know if you are getting there?

What the mind of man can conceive and believe it can achieve.

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Amazon Vs eBay (7) – Selling Stability

sell successfully online
This is a short series of posts comparing selling successfully on eBay and on Amazon from the seller’s perspective. This time I am looking at selling stability.


OK, hands up anyone who fears for the future viability of either eBay or Amazon?  No one?  Absolutely right, they are both here to stay.

However, stability is more than the question about the corporate survival of either of these global brands.  It is about the stability that we as sellers enjoy.  How often have you logged onto eBay to find yet another announcement about changes?  Has that happened when logging into your Amazon seller account?

Result; Amazon wins.


Amazon            5.5

eBay                0.5

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Amazon Vs eBay (6)

sell sussessfully online
This is a short series of posts comparing selling successfully on eBay and on Amazon from the seller’s perspective. This time I am looking at selling formats.


Auctions – There is no contest here, literally no contest.  eBay wins!

Fixed Price – Certainly until recently there was no real contest here, Amazon was king.  However, 2008 has seen eBay move more towards fixed price listings while downplaying auctions.  The “best match” searches being just the last in a series of moves towards encouraging corporate sellers rather than hobbyist sellers.  So far, however, the advantage still lies with Amazon.

Result; Draw


Amazon            4.5

eBay                0.5

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