power tools are you looking for?’’ or ‘‘Haveyou seen the latest in curtain rods?’’ Listen to what they have to say, and ask open-ended questions. Try to gather as many business cards as possible so you can followup at a later date.
If you like to sell to the public and miss the person-to-person interactions youdon’t get on the Internet, you’ll love trade shows. You’ll also love the fact that buyerswho attend trade shows are serious about what they want. They tend to buy in quan-tity and, when they find a supplier they like, they stick with that supplier. Keep thefollowing guidelines in mind when you encounter someone who expresses seriousinterest in your products:
•
Be sure to establish a minimum order amount, such as $50 or $200, and stickwith it.
• Make sure the wholesale price you set for your work is going to give you an
adequate profit.
• Have an order form printed up before the trade show and hand it out toprospective buyers. The form should list your models and prices as well asyour contact information and payment terms.
•
• With new buyers, don’t be reluctant to ask for 100 percent payment up front,or at least 50 percent down with the balance to come cash on delivery (COD).If you are lucky enough to receive a large order that you know you cannotfulfill immediately, offer a delivery schedule that matches your ability to pro-duce the product—for instance, one-third up front, one-third in a month, andthe final third in two months.
Another benefit of selling at trade shows is that it is customary for the buyer topay for shipping, although some wholesalers offer free shipping as a perk to attractmore business.
Tip: American Express Business Resources has a Web page entitledHow to Sell at Trade Shows. The page (http://www10.american
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express.com/sif/cda/page/0,1641,15836,00.asp) contains usefulpointers for getting the attention and retaining the interest of thosewho stop by your booth and show interest in your products.
Getting Local Sales at Flea Markets
Selling at flea markets is easier than you think. Yes, you have to pack your items inboxes and haul them to the sale. Yes, you have to get up very early in the morning—often, before the sun—to get to the market on time and set up by the time customersbegin to flow in. But all of your work is over in a single day. And rent is inexpensive—some markets charge $15 or $25 for a space. And if you’re a social animal who likesmeeting your fellow sellers and talking to shoppers in person, you’ll find flea marketsa much less lonely place than eBay, where it often seems like you are working inisolation.
They’re Not Just for Collectibles AnymoreThe Internet has transformed flea markets. Both buyers and sellers know that youcan find treasures more easily, and often at a better price, on eBay than you can atthe flea market. You see fewer and fewer quirky one-of-a-kind household collectibles.More and more shoppers go there to buy new or almost-new household items.They’re also more knowledgeable than they used to be because, in many cases,they’ve already done research on the Internet and know what something is worth.
The bottom line is that you’re no longer out of place if you have large quantitiesof wholesale clothing, perfume, or other items for sale at the flea market. You cansell wholesale household merchandise in the real-world market just as you can oneBay, and although you have to get there early and rent a space (in some cases, foras little as $15), you don’t have to deal with insertion or Final Value Fees at the endof the sale, either.
Tip: Some ﬂea markets let you sell things you would never dream ofselling online. The ﬂea market held by New Holland Sales Stables,Inc. every Monday lets the public bid on horses and other livestock,for instance. You can ﬁnd out more about this and other Pennsyl-vania ﬂea markets at http://www.ﬂeamarketguide.com/pa.htm.
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Researching Flea Markets Online
It might seem illogical to find flea markets and plan out flea market sales strategiesusing your computer. But the flea markets that are closest to you might not be thebest choices. Looking online gives you some initial information without having todrive hundreds of miles to check out a bigger market. The following sites serve asgood starting points:
Flea Market GuideYour first online resource for flea markets should be the Flea Market Guide (http://www.fleamarketguide.com), a comprehensive listing of flea markets throughout theUnited States. This site holds the details of thousands of flea markets, with contactinformation, hours, fees, and other necessary information. A simple search of yourtown or neighborhood should help you select the best place to sell your merchandise,if you take the time to contact all the possible markets and find the best deal. Moststates or cities also have listings for flea markets, if you want to make sure you’re notmissing anything.
Tip: Sometimes a speciﬁc category of merchandise will have a sitewhere you can search for sales, such as Booksaleﬁnder.com, a usefulsite that sends you biweekly information about all the book sales inyour area, up to 30 miles away. This lets you keep tab of library sales,book auctions, and dealer liquidations more effectively than doingan hour of research a day.
Openair-Market NetThis superb site (http://www.openair.org) is a global listing of open air markets of allkinds, like farmer’s markets, flea markets, and street vendors. The resources here arechanging all the time, and include an active discussion forum about running a streetmarket business, which can allow you to follow trends and establish connections.Other sources of information on the site include listings of market associations, ar-chives of past discussions about the problems of running a business, and tips on howto create a web presence for your flea market business. This site is motivated by adesire to help vendors succeed in their business, so you can trust that their informa-tion is reliable.
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Tip: AuctionBytes editor Ina Steiner wrote an informative columnabout a huge ﬂea market in her own area—Brimﬁeld, Massachusetts.Big regional markets like this one are open virtually every day andattract tons of shoppers. Find out more about the ins and outs ofselling at this market at http://www.auctionbytes.com/pages/abu/y200/m04/abu0011/s03.
An Online Flea Market: SwapThing.comSwapThing.com (http://www.swapthing.com) is a relatively new site devoted exclu-sively to swapping merchandise, trading goods, and services online. There is no feeto post an item here, and only a $1 charge on completion of a deal. The majoradvantage of this site for someone running an auction business is that it provides agreat place to divest unsuccessful merchandise, or even to improve your inventory byswapping something that has sat on your shelf for years for an item in the specialtyyou’ve established for yourself. The free listing and the low completion fee mean thatyou will reach many potential customers who either cannot or do not want to useeBay or another traditional site.
SwapThing.com currently boasts more than 3 million listings, with many profes-sionals using the site to advertise their services as well. A recent addition to the siteis a forum for discussion among users, and coming soon are profile pages to helptailor your presence on the site. SwapThing.com also offers a program called Share-Thing where nonprofits can list their needs on the site, and donors can match thoseneeds, receiving a tax-deductible receipt for their donations. This sort of site, basedon the trading of goods and services rather than conventional buying or selling, seemsto be growing online, especially among small communities like universities andplanned communities. By becoming familiar with the use of a site like SwapThing,you might be placing your business in an advantageous position for the next few yearsof Web-based commerce.
Going Back in Time: Real-World Auctions
Sometimes, eBay and the other marketplaces described in preceding chapters aren’talways the best places to sell items. On more than one occasion, I’ve looked up theprices of antique plates or Coca-Cola memorabilia so that I could sell them on eBayon my mother’s behalf. When I reported exactly how many competing products were
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up for sale and how they were being offered for, say, $10 on eBay, she said, ‘‘I couldget $25 or $50 for it at the flea market.’’
You might be better off selling things like furniture or desirable antiques at tradi-tional auctions where live auctioneers wield gavels and call out the high bids. Tradi-tional auctions still take place in many parts of the United States, especially ruralareas where farm equipment is frequently sold off at auction. Traditional auctioneersare often experienced at selling motor vehicles and industrial equipment, and manyhave appraisal services as well. And even if you feel reluctant to leave the familiarconfines of the Internet and hand over your precious merchandise to someone elseto sell, keep in mind that many traditional auctions now offer some form of onlinebidding in addition to the bidding that goes on at the place where the sale is actuallybeing held.
Learn How Real-World Auctions WorkIn true old-fashioned auctions you have no reserve prices, no printed catalogs, andno computerized bidding process. You have an auctioneer, who conducts the biddingand keeps track of who the highest bidder is, often with the help of assistants whotrack bids and take down the names of bidders. You have the auction house, theorganization that provides the physical location for the sale. You have to consign theitems you want to sell well before the sale, so the auction house can include it inthe list of items for sale.
One of the nice things about real-world auctions is the fact that buyers who takethe time to travel to the auction house and wait several hours for an item to come upfor bids are likely to be serious about bidding. You have the option of setting a reserveprice for an item if you want to. And there is the fact that the event itself can beexciting, especially when attendance is good and bidders are actively participating.
One of the not-quite-so-nice things about traditional live auctions is the buyer’spremium: in addition to their high bid, winning bidders pay an additional fee to theauction house itself. A reasonable fee is 10 percent, although many auction housescharge 15 percent.
Research Real-World Auctions OnlineThe best online site to research local and specialty auctions is http://www.auctionguide.com. You can use this site to search for auctions by location or category ofmerchandise, to list your own auctions free of charge, or to post free want ads forequipment. One of the convenient features of the site is that you can search twoways—either sort by location through its auctions and auctioneers directory or searchby time through the calendar of auctions the site maintain for each region on the
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map. Auctionguide offers an excellent introduction to the types and terminology ofauctions, and also has a page devoted to the different kinds of auction softwareavailable, for both online and offline auctions. This site will help you find the bestauctions for your business, and if you need to hold an auction, it is a great way toreach thousands of buyers in your area.
There are many similar sites that allow you to search auctions by specific loca-tion,likelike http://www.midwestauctions.com, or by category of merchandise,http://www.farmauctionguide.com. If your business is focused on a specialty marketor region, see if there is a devoted site online. It will save you time and energy, andyou’re more likely to reach truly interested customers with your ads or by attendingthe auctions listed there.
Another online guide to offline auctions is the Internet Auction List, at http://www.internetauctionlist.com. This site has a large number of listings and you cansearch for auctions by date, category, or keywords. However, compared with Auction-Guide, this site is cluttered with advertising and less friendly to use. Listing yourauction with the Auction List is fast and free, so you might want to check in withthis site every now and then. Be sure to check your information on an auction offline,however, before you drive 30 miles on a Saturday morning only to find that thebenefit auction was cancelled a week ago and no one thought to remove the Internetposting.
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P A R T (cid:3)VI
Supplying YourNew Storefronts
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C H A P T E R (cid:3)20
Finding New Sources ofMerchandise
As you have learned in preceding chapters, you could conceivably expand your exit-ing eBay sales presence to include book and CD sales on Amazon.com, your excessinventory to Overstock.com, your electronics components on uBid, and live auctionjewelry sales on Bidz.com, to name just a few options. Having multiple sales willboost your income, but only if one important requirement is met: you need to have asufficient amount of merchandise to sell.
Ramping up your sales means ramping up your inventory and stepping up yoursourcing activities. For many businesses, it means making a step up from findingmerchandise on your own, one piece at a time, to ordering in bulk. To those whoalready order in bulk, it may mean ordering even more, or becoming an official dealerfor a particular brand of items—for example, you might become an authorized sellerof a line of cosmetics.
The challenge is finding new sources of sales inventory at a time when millionsare already selling on eBay and other venues. Luckily, you are hardly the first sellerto be in this situation. This chapter will discuss some tried-and-true techniques thatother sellers have used before you. These include gathering inventory from wholesaledistributors, from people in your own neighborhood, and from other Internet sellersso that you can keep your storefronts supplied with a steady stream of stock to sell.
Improving the Quality—and Quantity—of Your Inventory
I gave this chapter the title ‘‘Finding New Sources of Merchandise’’ rather than‘‘Finding More Merchandise’’ for a reason. More isn’t necessarily better when itcomes to sales inventory on eBay. Most sellers would agree that it is preferable tosell one hundred items for $500 each, netting you a $250 profit for each one, than it
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is to sell five hundred items for $100 each, with only a $50 profit per sale. Fewersales mean fewer items to list, pack, and ship. For a one- or two-person eBay business,high-priced items are ideal—as long as you can find a steady stream of regular custom-ers for them, that is. To ensure sales all year ’round, it’s best to not only expand therange of items you offer but also to sell more high-priced items in addition to yourless expensive offerings. Some suggestions for what to look for are explored in thesections that follow.
Don’t Be Afraid to Think BigThe most obvious way to expand your inventory to accommodate new sales is toboost the number of items you already purchase and resell online. One thing thatseparates small auction businesses from bigger and more successful operations isvolume. I can vouch for this on a small scale. In my first few weeks as a seller, Iexperienced the results in Table 20-1.
Table 20-1. Sales volume versus gross income.
End of Sale
7/10 (Sunday)
7/16 (Saturday)
7/17 (Sunday)
7/23 (Saturday)
7/24 (Sunday)
7/31 (Sunday)
8/7 (Sunday)
Items Offered
Items Sold
Gross Income
6
12
15
12
20
28
31
1
3
10
6
9
14
14
$62
$61
$324
$96
$218
$330
$467
These results impressed two important principles upon me: First, if you haveidentified a source of items that people want to buy, your income will generally goup the more you have to sell. Second, rather than having all your sales end on aSunday, it’s just as effective to spread out your sales so they end on both Saturdayand Sunday. I’ve since learned that scheduling sales so they end on weeknights iseven more effective.
Big-time sellers aren’t afraid to think really big. Instead of thinking in terms ofdozens of transactions like I do, they think about hundreds or even thousands. Theyknow that, if they can increase the number of items they have for sale by a factor oftwo, three, or more, their profits are likely to increase by the same amount. The bigobstacle for many sellers is doubt—you don’t know if you’ll make back the additionalamount you spend on your purchases, and you are afraid you are spending profitsyou won’t get back. You have to take a leap of faith and avoid holding back when it
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comes to purchasing new sales inventory. Buy as much as you can, even if it seemslike more than you can handle to begin with.
Also make an effort, if you can, to buy many variations on a single line of product.This doesn’t work if everything you sell is a one-of-a-kind collectible gathered fromestate sales. But if you sell new consumer goods, for example, look for variations inthe product line that you don’t carry already. If you buy five hundred pairs of shirtsin the same color and from the same manufacturer, in sizes ranging from small toextra-large, it becomes easy to list them because you take one set of photos and createone sales listing. You can easily duplicate subsequent sales listings because only theprices differ from one item to the next.
You can sell these sorts of variations on a theme even if you don’t deal in newmerchandise. For example, I don’t sell new items myself, but I try to stick with certainbrands that have demonstrated high demand. In Figure 20-1, you can see that I’m
Figure 20-1. If possible, sell merchandise with different sizes, colors, or models to streamline thelisting process.
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offering three pairs of shoes by Allen Edmonds. Creating the descriptions was easierthan usual because I could reuse standard information about the quality of the manu-facturer; I only had to change a few sentences describing the individual shoe. It’seven easier for sellers who put identical items up for sale; they only have to take oneset of photos and reuse them for each item.
Tip: One way to turn around a higher volume of merchandise is tobecome a wholesale supplier for other businesses that sell at onlineauctions. By selling large quantities of merchandise at cut-rate pricesto other auction sellers, you not only increase your volume but yourproﬁts go up as well. You can still sell individual items for largerproducts. However, many successful sellers build up their inventoryand are able to turn around a higher number of transactions by sell-ing in bulk at wholesale in addition to selling one item at a time.
Expand Your Price RangeHigh-priced items that are also in high demand are ideal products for eBay and otherauction venues. On Amazon.com, for instance, if you can sell a hard-to-find textbookor technical manual for $75, it is far better than selling fifteen paperback novels for$5 each. When I think about merchandise that yields big profits, I always think aboutDrew Friedman, who sells on eBay under the eBay Store name White MountainTrading Company (http://stores.ebay.com/White-Mountain-Trading-Company). Drewsells premium fountain pens that command prices as high as $7,000 each. The profiton these pens is so great that, if Drew sells only one pen per month, he has madeenough money to make his PowerSeller quota. He’s the envy of his PowerSeller ac-quaintances. He spent many weeks searching for suppliers before he was able tolocate and contact the manufacturer of the pens in Missouri. And only after a per-sonal visit to the company was he able to obtain an agreement to be an authorizeddealer of those pens on eBay.
However, high-priced items don’t sell consistently at all times of the year. Theytend to sell well during the busy holiday season, for example, but during the summer,you often discover that the high-ticket items are languishing unsold in your eBayStore. To make up for the difference between high-demand and low-demand times ofyear, it pays to sell both low-priced and high-priced merchandise and to offer a rangeof items for sale. For instance, Drew Friedman also sells $79 watches, collectiblemedals for $12.50, and $69 golf shoes in addition to his high-end pens.
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Expand Your Sales OptionsFrequently, eBay members who participate in the PowerSellers discussion boardsexpress one of their greatest fears, which is that they can be suspended by eBay atany time if one of their buyers makes a complaint against them—whether that com-plaint has merit or not. If they depend on eBay for all of their income, a few days ofbeing offline can be a disaster.
Although some sellers stick with a single proven marketplace to conduct theirbusiness, many others diversify to achieve a greater level of security. They sell in thevenues described in previous chapters—their websites, brick-and-mortar stores, orother auction venues.
Tip: eBay recently created a new area called Reseller Marketplace(http://reseller.ebay.com/odcs/custom.html?template(cid:4)start),which is intended for suppliers and manufacturers who want to liqui-date extra inventory quickly. In theory, the merchandise listed inthis area is offered in large quantity and low cost. It is a good placeto look for bargains in your area of business.
(cid:3)
Obtain a Resale Certiﬁcate
No matter where you sell or where you obtain your merchandise, you’ll ﬁnd it helpfulto obtain a legal document that identiﬁes you as a certiﬁed reseller in the state inwhich you reside. The document in question goes by different names depending onwhere you live. Some states call it a resale certiﬁcate; in others, it is called a resellercertiﬁcate, certiﬁcate of resale, or something similar.
In any case, a resale certiﬁcate is easy to obtain, yet remarkably signiﬁcant towholesale suppliers and manufacturers you might want to deal with. In order to ﬁndthe document for my own state, Illinois, I did a search on Google for ‘‘obtain resalecertiﬁcate Illinois.’’ At the top of the search results I found an Adobe Acrobat ver-sion of the form CRT-61, which I need to ﬁll out to obtain a certiﬁcate from theIllinois Department of Revenue. (You can ﬁnd this form yourself at http://www.revenue.state.il.us/taxforms/Sales/Crt61.pdf.) Your state’s department of revenue(the ofﬁce that handles your state income taxes) can also tell you where to mail theform and whether a fee is required; typically the fee is $20 or less.
For a small amount of labor, you obtain a certiﬁcate and a sales tax ID numberyou can submit to wholesalers. Many wholesalers require a sales tax ID number so
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they have an indication that you are a legitimate businessperson. Even more impor-tant, you are complying with the law when you do so.
Make Sales Contacts at Trade ShowsTrade shows may be time consuming and traveling to attend them can be expensive,but they are invaluable for making the sorts of personal contacts that can lead toprofitable relationships with wholesale suppliers. Wholesalers, many of whom havebeen in business far longer than you have, are more comfortable with handshakesand discussion over drinks than with orders placed over the Internet. By attendingtrade shows, you are meeting them on their territory and helping to give them moreof an incentive to do business with you.
Note: As described in Chapter 19, trade shows are one of your best op-tions when it comes to finding wholesale suppliers. I refer you to thatchapter for tips about how to ‘‘work’’ trade shows when you are research-ing new products to sell and when you have wholesale merchandise youwant to sell to other businesses.
Develop a Winning Business AttitudeSometimes, the attitude you take toward buying and reselling on eBay makes a hugedifference in the volume of merchandise you are able to turn around. If you have anegative, anxious attitude, you aren’t going to find new products to sell or expandyour business the way you want to.
Finding more merchandise to sell depends in large measure on your expectationthat you will find more to sell. Simply anticipating a higher volume of sales often willcause you to produce them. And don’t wait for conditions to be perfect to startbuying more merchandise and putting it up for sale in new locations. Expect thatyou’re going to be busy, and act as though you have already expanded; adopting asuccessful approach will ensure that you will do what you need to do to increase yourvolume.
Tip: If you are dissatisﬁed with your sell-through rates or the num-ber of bids you are getting, ask someone to evaluate your auctiondescriptions. Contact by e-mail successful sellers whose listing tem-
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plates you admire, and ask if they would mentor you. The worst theycan do is say no; at best, they’ll give you useful tips on how toupgrade your sales.
Locate the Holy Grail: A Reputable Drop-ShipperFor many sellers on eBay, Overstock.com, and other venues, the ultimate resource isa drop-shipper: a supplier that provides you with merchandise to sell, but that storesthe merchandise you purchase in its facility and ships it out for you when you makea sale. It might sound too good to be true, and often, it is: many drop-shippers re-spond slowly and provide you either with poor service, poor quality merchandise, orboth. But because there are some good drop-shippers around, many sellers eagerlyhunt for them.
For those who (like me) want to be able to control every part of the sales process,drop-shippers can be frustrating. If they say there is a power outage, flood, or otherproblem at their facility, you have to take their word for it. But it’s still up to you toexplain to your customers what the problem is. You are also called on to deal withany packing or shipping deficiencies that are the drop-shipper’s fault. But in truth,this doesn’t happen very often—and the same outages can slow you down just asmuch if they occur to you personally.
The disconnect between you and the merchandise you sell has other implications.You have to inspect samples of the items carefully before you put them up for sale,and you need to either take your own photos or depend on the drop-shipper to pro-vide you with accurate images. Because drop-shippers generally want to hold on toyour business, it is not to their advantage to misrepresent what they sell and have youcancel future orders. Once you find a drop-shipper that seems reputable, the companyis likely to want to ship promptly and pack carefully to hold on to your account.
One of the great advantages of working with drop-shippers is the ability to orderin bulk. As I’ve already said, the more you can sell, the more you are likely to makein terms of gross sales. If you don’t have room to store, for instance, one thousandespresso machines, a drop-shipper gives you a practical alternative to renting yourown warehouse space. Drop-shippers also save you a considerable amount of timebecause they enable you to focus on e-mails and sales descriptions, not to mentionthe act of successfully receiving payment for what you sell, so you don’t have tospend hours photographing, packing, or running to the shipping office. The drop-shipper handles all of those time-consuming steps for you.
Drop-shipping is such an attractive prospect that you have to be careful when youshop for a supplier. The moment you start looking for them online, you’ll encounter
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e-books, CDs, and websites that invite you to purchase lists of drop-shippers. Thelists might contain contact information for some drop-shippers, but they also containlots of useless data as well.