How to Make Money on eBay: 5 Killer Tips for Selling Items on eBay

Imagine having an exchange like this with your friend:
Friend: “I have an idea. I’m going to buy a Subway franchise. It’s a good way to make money.”
You: “Have you ever even had a sandwich? You grew up in a traditional Asian family and as far as I know you never even had a sandwich.”
Friend: “Why are you trying to discourage me?”
You’re not trying to discourage your friend, of course. But you know it would be asking for trouble if you had never even eaten a sandwich before buying into a sandwich business. How could you possibly understand the issues and manage people properly?

How to make money on eBay killer tip #1. Buy Before You Sell!

Yet many people dive into selling on eBay before they’ve bought a thing. There’s a rhythm on eBay, and a lot of moving parts. An average transaction has these steps and sometimes more:

• You buy something
• There’s some communication from the seller
• The seller waits for you to pay and maybe has to remind you
• You pay via PayPal (most often), or perhaps a check that takes time to arrive in the seller’s mailbox
• If necessary, the seller waits for funds to clear (this can happen on eBay too, not just a check)
• The seller packs and ships the item
• You wait longer than you’d like, probably because you chose the cheapest shipping method
• The item comes, you inspect it, and maybe you have another question or two
• You post feedback for the seller, possibly after the seller waits politely for a few days because you neglected eBay’s reminders to do so
• The seller leaves feedback for you

It’s a more complex flow than you would image, and can get more so if things like Escrow or insurance requirements are part of the transaction. Many sellers complain if something isn’t shipped right away. They may be irrational, but you should feel what the buyers feel at least a few times before attempting to extract money out of them.

How to make money on eBay killer tip #2. Don’t Skip This Step! Sell What You Know

I know a guy who makes good money selling patio fireplaces on eBay. Excellent money. Support-yourself kind of money. What’s cool is that he doesn’t have to buy patio fireplaces, store them, ship them, and do service on them. He “dropships” them, meaning he’s just a freelance commissioned salesdude. As soon as he makes the sale on eBay, he hands it over to the patio fireplace company to do the heavy lifting. He’s not an employee, he doesn’t need a forklift-it’s working for yourself with all the hard parts left out.

Good on him, but although I know a great deal about his involvement in the market and have studied his listings like a rabbi studies the Torah, I wouldn’t dream of going into the patio fireplace business. I don’t know what’s good. I don’t know what customers expect. Without empathy for the market, I would end up serving them poorly, and doing so would get me kicked off of eBay.

I have some specialty knowledge, and so do you. Mine’s in guitar and keyboards, which happen to be pretty high margin items. Maybe you know farming equipment, or 1980s Datsuns, antique quilts, or Victorian-era magazine ads. Use that knowledge to your advantage, and remember that you can start providing people a valuable service and make money with nothing but you’re knowledge.

Here’s how. eBay has an affiliate program, which lets you make money on sales you refer to them. Start a simple website (it’s easier than it seems; I learned it through the free ebook at onthewebinanhour.com/freeminicourse; the free version gives so much info you don’t really have to buy the full one) talking about the area you know, and if it has an eBay market just post some simple links eBay gives you. You post individual items, the results of keyword searches, whole categories, whatever.

Then just talk about your hobby, and give buyers valuable help. When I bought my first guitar some time ago, I didn’t know whether I should buy the Fender Stratocaster made in America or the one made in Japan. I didn’t know an impartial guitarist, who would have pointed out that the Japanese ones are every bit as good, yet less expensive than the American-made ones. Nowadays, I could post that information on a website, and with eBay affiliate links, I can make money helping people.

How to make money on eBay killer tip #3. Build a Relationship With The Market And Get Search Engine Love In Return

No smart seller just posts stuff on eBay and expects it to sell. Smart sellers ensure they follow these simple but essential steps, which build trust with the user-and help drive traffic to the seller’s site.

A. Fill out Your About Me Page

Your About Me page helps build trust from users. If you’re selling high-end goods, and that’s by far the most efficient way to make money on eBay, they will, not might, look at your About Me. And despite what the page title says, it should be all about them. Your About Me page should give them every possible reason to buy from you. That could include links to buyers guides you’ve created, tips on how to save money in your market, and anything else you can think of that will serve your customers well. It also needs your picture, another must for creating a connection with your buyers.

Those things are compelling, but just as compelling is the invisible benefit of raising your visibility in the search engines. eBay is a popular site. Google likes popular sites. Posting your content on a popular site makes your products easier to find. This is free branding of the most precious kind.

B. Create Your Own eBay Blog

What we said about links before? Make at least a few blog entries. Search engines like content on  popular sites. What they like even better is fresh content on popular sites. Blogs are catnip to search engines, so understand the power of posting to your eBay blog.

C. Build A List, Build A List, Build A List

Each sale you make is an opportunity to add a satisfied customer to your email list. It is ridiculously more expensive to acquire new customers than to get repeat business. As soon as you’ve a customer happy, transfer him to your buyers mailing list. Keep them in the loop about upcoming specials, coupons, and niche-related info that doesn’t even improve your bottom line directly. If your specialty is old weather vanes and Christie’s is about to run an auction of Colonial weathervanes, let your customers know. They may know have $350,000 to spend on a good specimen, but they’ll love the catalog images. If you hear about a new show just for weathervane collectors, tell your users. (Even better, contact the show organizers and arrange for a discount price for people who sign up mentioning your eBay seller ID.)

If you don’t understand why it’s so important to build an email list, you’re throwing away gold. Just stop reading this article and go play Solitaire or something. You’re hopeless.

How to make money on eBay killer tip #4. Know Shipping Costs and Packaging Time Upfront

Shipping can kill your business. The most obvious mistake when doing market research is to look at the cost of an item for sale (remember, check the Completed Listings box; anything else is meaningless and pure fantasy on your part), figure out how much it costs you, and mentally make yourself rich when you think about how much you could undercut the competition.

Before you do that, Warren Buffett, understand that eBay now includes shipping cost as part of its search by price. In the old days you could list a book for a Buy It Now price of one cent and charge $9.95 shipping. Because shipping was disregarded in price sorting, you’d look like the cheapest item even though you were a lowlife scammer. eBay is smarter than that now.

Here’s where it gets even more hairy. They have begun to include your shipping cost as part of the final value fee. That means the more you charge for shipping, the more you have to pay eBay for the privilege of selling an item! How messed up is that? A lot, and it’s had a serious impact on thousands of sellers. But that’s the way it is, and you cannot overlook it when determining shipping costs.

A second issue that may bite is the time required to pack something for shipping. I know guitars well, but they’re big and heavy and expensive to pack. The packaging materials are costly, but my time even more so. I never sell used guitars. Just not worth my time, when I factor what I make per hour into the sale. Now dropshipped instruments… well, I’m going to keep my niches secret!

How to make money on eBay killer tip #5. To Get Good Deals on eBay, Buy On… eBay?

The old adage was never more true than on eBay: Buy Low, Sell High. If you’re hip to eBay selling you call it eBay arbitrage: using your superior knowledge of a market to buy poorly described or miscategorized goods on eBay using a sniping service, then repackage and improve the description. Take Red Line Hot Wheels. Hot Wheels are inexpensive toy cars sold by the millions. They’ve been around since the late 1960s. The first run of them had a decorative metallic red piece of trim around the tire, and ran smoother than the billions of successors.

It is not at all unsual to find Red Lines listed in auction listing containing a lot of old toys, or even in an estate sale. (Around here, thrift stores are already hip to Red Lines, so don’t bother.) A Red Line in good condition can go for $400, and an identical non-Red Line for only a few bucks. Auction arbitrage works best in narrow markets you know well.

Expert buyers know that a) The best deals are in auctions with no minimum and no reserve price,  not Buy It Now, and that b) The only way to avoid bidding wars and attracting shill bidders is to snipe your auction (place the bid just a few seconds before the auction ends). There are online services that do this for you. The one I’ve used longest is http://www.esnipe.com but all the top ones are good.

Making Money on eBay: The Good News And The Bad News

The bad news is that eBay is far more competitive than it once was. The good news is that by following these 5 tips alone you’ll have far surpassed the vast majority of eBay sellers, who treat the Marketplace like a swap meet instead of a real business. Avoid those mistakes, and you maximize your chances for making money on ebay; ignore them at your peril.