Several years ago I explored making money on eBay as a viable online business. I found a few good niche products that were selling well and had very little competition. Next I located wholesale suppliers for these items and opened up an eBay store. The items sold well and I continued to add new products when ever I uncovered other untapped niches. The profit margins were great, returns were low and eBay was supportive of my efforts. Life was good.
As the years rolled by making money on eBay become more cumbersome for sellers with new policies and seller rating systems. It became easy for the buyers to harm the seller's reputation with just one click. eBay never sides with the seller, even though you can protest the negative feedback it never gets reversed. The buyer gets all the power so that even if you deliver the perfect product the buyer needs only to complain to eBay or threaten you with negative feedback and they get what ever they want, usually a refund and they keep the shipped item to boot.
Making money on eBay today is no longer for the little guy. To be successful you must list and close hundreds of auctions every day. Why? Because high volume is the only tool that a seller has to counteract the feedback system and the malicious buyers who know how to game the system. The high volume sellers don't even blink at your request for a refund, they issue it immediately and move on. Because their high volume takes into account these expected losses.
The small seller trying to make money on eBay is doomed to failure before they even start. To even be competitive you have to offer low prices resulting in a low profit margin and after factoring in about a 10% return item rate you will be in the red every month and very few start-up sellers will ever make it big on eBay. Just click on some popular items on eBay and visit the stores of those sellers and you will see they are backed by bigger enterprises for example Best Buy. How ya gonna compete with that?
This is a cautionary tale for those who have seen a lot of hype about making money on eBay. It isn't likely to happen but rest assured you can still start your own online business and be very successful. Look for an opportunity that sells information instead of inventory which makes your start-up costs almost nil and no more trips to the post office!
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