Four eBay Businesses
To Choose From



eBay businesses - I bet you thought the only way to make money on eBay was to invest your hard earned cash in stock and them put it up for sale.

Well, this is true but for those of you who would like to start a business without having to invest money in stock, there are other ways to build an eBay business.

Drop Shipping

Drop shipping is a really good solution for people who do not want to source and invest in their own stock.

How Does It Work?

  • Choose a product from a dropshipper ie supplier
  • List the product on eBay
  • Sell and collect payment from customer
  • Place the order with the dropshipper
  • Dropshipper sends the product to customer

And out of the entire process, you never touched or saw the product! That's dropshipping.

Advantages of Drop Shipping

  • No paying for stock only eBay fees
  • You save time and money as you don't have to buy shipping materials or physically ship the item
  • You can make money without actually touching the product! I think that's pretty cool.
  • You can "afford" to list many more items in your store as you don't physIcally have to hold the stock.

Downside of Drop Shipping

  • The profit margin is smaller when you drop ship because you are paying a "middle man"
  • The supplier may run out of stock and you have already "sold" the item to your customer
  • You have no control of the packing and delivery date which can result in negative feedback. Something you definitely don't want!

Consigning

Consigning is the term used when you sell other people's items. This can apply to either new or second-hand items. The principle is the same, only the sourcing of the items is different. But what it'll give you is a never-ending supply of things to sell.

How Does It Work?

  • Approach a the retailer/wholesaler or person. This could be a retailer or anyone who, in fact, has things to sell. It could also be someone who is selling their home or a deceased estate.

  • Enter into an agreement. This agreement is called a Joint Venture.

  • Sign official agreement stating the Terms and Conditions. This should include how you'll split the profits, what percentage of the profits you'll get, who'll pay the eBay fees, where you'll store the items, when you'll pay your supplier etc.

  • Ensure you have adequate storage and the goods are insured. Note: In some cases the retailer will hang on to the stock until it is sold which is the simplest solution.
  • Once the goods are sold, arrange for shipping and pay the retailer/owner.

Advantages of Consigning

  • No initial investment in stock
  • You have the potential of a never-ending supply of goods
  • The only cost you have is for the listing of the item

Downside of Consigning

  • You'll spend more time on sourcing items
  • It's a much more hands-on work require with approaching suppliers, listing items etc
  • You'll have to ship the items yourself
  • Difficult to operate when you're away on holiday or from another part of the world

Arbitrage

Is that a word? Yep. It really is! What it actually means is simply this: You buy stock on eBay at a very low price and then you list and resell it on eBay at a profit. Very simple?

Advantages

This is a great way of sourcing products because:
  • you get items at bargain prices when you target items with no bids on them and you buy them at last minute
  • you can source all your items in one spot
  • no agreements with suppliers
  • no bulk buying (unless that is your strategy)

Information Products

More and more people are buying information products in either a digital format or hardcopy. You can either sell products that someone else has created or develop

Advantages

  • This can be extremely profitable if you find the right product as

    eBay Businesses - an example of one eBay Businesses - An Example

    the initial costs are small and your ongoing costs are minimal and therefore low risk
  • Depending on the product your develop, you could potentially have very low competition because you are selling a unique product
  • This sort of business can be operated from anywhere in the world; and
  • you can sell globally as digital products are downloadable and CDs are cheap and easy to ship

Downside

  • Takes time to develop
  • Without sufficient, effective research you can end up with a "lemon" (no-goer).

So here you have 4 alternative ebay businesses that can still produce the desired outcome you're looking for but a much lower risk and minimal investment. What do you think?