Product Sourcing For Ebay: Don't Get Caught In These 3 Deadly Traps

Are you new to product sourcing for Ebay?
While this is an excellent business model, like any business, there are traps which can catch the unwary ...

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When choosing your wholesalers for Ebay sellers, here are some points you need to be aware of:

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1. Compensation - Keep in mind that you are running your Ebay business to make money. There are several different compensation programs in the market. The most common model allows you to set your own retail rate: your partner's unit wholesale price for each product plus your own markup.

So the minimum bid you will accept in your auctions is your retail rate. Every time you sell an item, you earn at least your markup. This method is straightforward and easy to track. Some wholesalers operate different compensation models, so remember to double-check the terms and conditions. Make sure you understand the compensation model. Here are some questions you need to ask:

Is payment by check only? Is direct deposit available?

Is there a minimum amount you need to earn before they pay you your commission?

Who handles taxes?

Are you required to make a long term commitment?

2. Sell only what's hot on Ebay - You need to be in tune with the market. To make money right from the start, you need to offer only the best items to sell on Ebay. For example, your music CDs dropshipper needs to offer the latest hits as well as the evergreens and golden oldies. Selling Elvis Presley CDs can make a decent amount of cash every month, but selling the latest chart topping single could net your the same amount in one day! If you need to find a new product sourcing for Ebay partner who offers the hot product, then do so. Don't limit yourself to your trusty pet accessories dropshipper during the Christmas season, find a dropshipper who offers the latest Christmas toys and decorations. Here are some questions to ask yourself before you setup your Ebay shop or auction:

Do you know what is hot this season?

Does this wholesaler offer these items?

Is this model new, or has it been offered the past umpteen years?

3. Shipping and handling - Make sure your partner handles the shipping and handling. Also make sure you pass the postage and handling costs to the customer. One of the main attractions of using a wholesale dropship supply partner is to avoid having to go to the post office yourself. Make sure that your partners directly ship the products from their warehouses within one or two days after the payment is received. Here are the pitfalls to be aware of:

Do you need to maintain any inventory? The answer had better be "No!"

Do you need to pay postage out of your own pocket? You are supposed to pass this cost directly to your customer.

Does your partner charge you any additional administrative costs?

Do you have to pay any storage costs?

If you have to answer "Yes" to any of the 4 questions above, find another vendor!

When picking your partnerships for product sourcing for Ebay, keep these 2 points in mind - minimum costs and maximum simplicity. Otherwise you may as well set up a workshop to produce your own products for sale.

Where in the World Do You Find Products for eBay ?

The question I get most about eBay is "Where do I find products to sell on eBay?". Actually, there is an endless number of products you be selling on eBay. Just take some time and you will have loads of possible product to list on eBay.

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So, where do you start?

First, start selling items around your house. Take a day and clean the attic, garage or your kids' bedrooms. I promise you will find lots of great items to sell on eBay. One of the advantages of selling stuff from your home is there isn't any investment in it. You already own these items and don't want them any more. So, it gets rid of stuff in your house and it gives you seed money for future inventory in your eBay business. If an item doesn't sell, you haven't lost any money buying in bulk for eBay. Once you are selling on eBay for an extended period of time, you should start looking for another source of product besides your own home. Some sellers do very well buying products at garage sales, estate sales, flea markets and used book stores.

Vintage and antique items do very well on eBay.

If you choose this avenue to find product, remember you make money when you buy the items for resale on eBay. This might sound strange, but it makes perfect sense if you understand what I mean. When you purchase items to resale on eBay, you must buy them at a low enough price to make a decent profit. Be sure you are getting a great deal on vintage & antique items. Also, check out eBay to verify that the items you want to buy actually sell for a profit on eBay. There is nothing worse than buying something at a garage sale, only to find no one wants to bid for it on eBay. In other words, do your homework before you go. Check out what's hot on eBay.

Finally, you buy in bulk and reduce the amount of time you spend writing your auction listings. You may find items at dollar stores, going out of business sales and discount stores.

My favorite way to get bulk products for eBay selling is from drop shippers or wholesale distributors. When you list household items, vintage items or antiques, you must write a new listing every time you put an item on eBay. Once you do this for a few months, you will see how time consuming this is. I'm sure you will be looking for a new way to source products in your eBay business. Research what is selling well on eBay and start looking for drop ship and wholesale distributors in that industry. Drop shippers are companies that will ship your items to your customers directly from their warehouse. In other words, you do not have to inventory product from drop ship companies. You simply process the order through eBay and Paypal. Once you receive your money, you order the item from the drop shipper and he will send it to your customer. What a slick deal.

Wholesale distributors require you to purchase a minimum amount of product for your inventory. You will stock the inventory yourself, either in the garage, basement or a storage unit. When you complete an auction on eBay, you pull the item from your inventory and ship it to your customer. It's quite simple, too. If you are just getting started with eBay, I suggest selling stuff around your house. Then, I highly recommend finding wholesale and drop ship companies to build your eBay business. You can use the same listing over & over again. Once you test your listing for each item, you simply "wash, rinse and repeat".