Part Time Selling:The eBay® & Amazon® Business Start up Guide What to do BEFORE You Start Selling Online

Part Time Selling:The eBay^® & Amazon^® Business Start up Guide
What to do BEFORE You Start Selling Online

From the Author of

Jason Guarino's web site, blog, and places to buy his eBooks & paper back books can be found at PartTimeSelling.com. He welcomes comments and suggestions by email at info@PartTimeSelling.com.

Copyright © 2012
PartTimeSelling.com

Introduction

The purpose of this short guide is to the provide the basics of setting up an online business with eBay®, Amazon®, or any online marketplace for long term profit. It is part of my Part Time Selling series geared toward helping people to become an Online Selling Pro.

This guide will educate you and give you the information that you need to know BEFORE you begin. Many online sellers have no idea where to begin but need a road map for the basics. If you have ever wondered what is involved to get started with becoming an Online Selling Pro but have no one to talk to, then this guide is for you.

Unlike other books that tell you how to run your eBay® business, such as my book Part Time Selling: 90Days to Online Success by Selling on eBay® & Amazon®, this guide will give you a good idea of what is involved to break the ice and get started. Use this guide not only to gain knowledge about what you will need financially, but to help you decide if becoming an Online Selling Pro is something that is right for you. If you have already made the decision to start selling online and you are set up, then I would again suggest my book mentioned ahead of time. My book covers how to become an eBay Top Rated Seller and Amazon Featured Merchant. It also discusses proper product sourcing by learning how to find product to resell on eBay & Amazon.

I have been asked countless times from friends, family, and strangers about my business. When I begin to explain my daily process, I see the same reactions. Usually they are puzzled because they didn't know exactly what was involved. There is a massive misconception that it is easy to do. Well, I am here to tell you that it is hard. Not the hardest business in the world to run, but absolutely far from easy if you want to be a long term success.

The good news is this is not impossible. Education, training, making mistakes, along with plain old fashion experience can yield the Online Selling Pro within you. I encourage you to use this guide to help you understand what you need to do before you start selling.

After reading this guide if you decide you want to take the next steps, I would encourage you to pick up my book PartTime Selling: 90 Days to Online Success by Selling on eBay® &Amazon®. It dives deeper into the next stages of selling online such as product sourcing, customer management, and branding your online image to reach the top selling tiers offered by eBay® & Amazon®. Then one day when someone asks you what you do for a living, you can explain and see the same reactions from your friends and family that I have seen for years. This is when you will know that you are now an Online Selling Pro.

Selling on eBay® is a business. Like any other business, it requires not only the right type of person, but the resources to get going and maintain a steady cash flow. Anyone who is considering selling on eBay® needs to understand this. Long term success on eBay®, Amazon®, or any selling platform does not yield immediate success. You must lay out a business plan or strategy.

eBay® is different from a traditional retail store in many ways. There is a massive amount of flexibility with your customer base and customer service. Regional demographics really are not an issue as your customers are world wide. While your traditional retail store is usually closed in the middle of the night, you may get most of your world wide sales while you are asleep.

This is where the similarity ends. I am here to tell you that if you do not treat your eBay® business as a true business venture, your business will result in failure. This is the same failure a retail store will experience that is not set up or run correctly.

Even though a retail store and eBay® are different in functionality the core concepts for success are still the same. They take slightly different roads to reach them. Becoming an Online Selling Pro is straight forward but can be a challenge. Yes, some concepts are common sense, but many are not.

Quick Note

eBay® is by far the most well known source for anyone to sell online. However there are many other sites like Amazon®, Sears Market Place, Buy.com, and Etsy.com to name a few. When I use the word eBay® in this guide, it should be understood this also means any place that lets you sell your items online.

Again, I want to point out this is a short guide. It is not a full length book that discusses the specific details like Part Time Selling: 90 Days to Online Success by Selling on eBay® & Amazon®. Think of this guide as a 30 minute consultant meeting giving you the big picture and letting you know what is involved.

What is Covered

Money : How much do you have?

Product : Can you get it?Time : Do you have the time to run your business?The Start-up : All the basics you need to have in place

Money
Money is a major factor in establishing any business. As mentioned, many people think as an Online Selling Pro you buy and sell without much more beyond that. Well, there is a money factor. As a retail store owner, you will need to buy inventory, promote your business, and wait the several months or even years in many cases before yielding a profit that you can pull a paycheck from. If you are flat broke living paycheck to paycheck with no savings, you will not have the resources necessary to get off the ground. If you think otherwise you are only fooling yourself.

Online sellers tend to yield profit faster than a retail store because you don’t have the overhead of a retail environment. But you still need money as part of your foundation. Did you know that eBay® may hold your money up to 3 weeks as a new seller? What about the product source? Do they always stock the items you will need or do they often run out forcing you to buy a few months worth of inventory at a time? Do you have the hardware and supplies necessary to take care of your customers orders?

Your sales will not be an instant success and will take time to build. The slow momentum in the early stages may drive you nuts if you sit there watching every order trickle in. If you have to worry about money because you are not properly funded then you can count on a great deal of anxiety and stress in your life. These never have a positive effect on your personal life or business.

The money part comes down to 2 things. Resources & paying yourself.

1. Resources. Having the resources to get off the ground during the beginning is vital. Not only because of eBay® holding your money, but because of the potential struggles and learning curve you will encounter. Once you project sales, I would suggest a 2-3 month buffer. Yes, I am suggesting that you bankroll enough money to keep 2-3 months worth of inventory in stock in addition to all your starting & running expenses.
2. Taking a paycheck. Do not take a dime from your business until it is ready to give it to you. While each business setup is different, follow this general rule. When your business reaches a point where it is yielding a profit and you can take a paycheck, don't. Keep track of this potential to take a check. When you feel comfortable after a certain time frame, say several months, then go for it. This will help prove stability in your business and a wise choice when considering changing your existing career. Be be patient before considering making changes to your day job.

Why take the precautions? Simple, to make sure that you know what you are doing. Being a business owner, regardless of the business type takes a certain type of person. Some individuals can be a doctor, lawyer, contractor, or artist. It is in their blood and is all they know and love to do. Trying to make an artist into a doctor may have disastrous results. Trying to be a business owner when you are not this type of individual in your heart (or not ready) can be just as disastrous.

This approach will help ease any emotional or financial pain if things take longer than expected or don't work out. It will also give you something to think about before starting.... Is selling online really for me?

Product
Product...Product... and more Product. In my book Part Time Selling: 90 Days to Online Success by Selling on eBay® & Amazon®, I describe sourcing methods including how and where to find product. In this guide I will discuss product strategy and diversity.

Do not be a one trick pony. You need to diversify. When you walk into an auto parts store, they just don't sell parts to repair your car. Look around and you will see detailing equipment, clothing, branded key chains, and even snacks and soda. They will have several hot key items that are their most profitable consistent sellers. They will then have their mid & low range volume product scattered around the store.

What happens if one of their hot sellers cannot be supplied any more? For any number of reasons they cannot get their hands on this particular product. Do they close up shop? No, they have others to fall back on.

Whats the point? Check out these sellers and examples.

Seller “A”
Seller A is an eBay® seller moving ink jet cartridges. He has a great source for getting aftermarket (Non factory branded) HP ink jet cartridges. He is moving 150 a week and making a consistent great profit on them. Seller A doesn't really sell much of anything else.

Seller “B”
Similar to Seller A, Seller B moves the same amount of HP Ink jet cartridges and sources them from the same supplier as Seller B. Seller A also sells Epson Cartridges sourced from another supplier and Lexmark Cartridges from another. Additionally since he is catering to customers who need printer supplies, he stocks USB printer cables, replacement power cables, and printer cleaning equipment.

Next week Sellers A and B call their HP cartridge supplier only to find out he is out of stock and will be for a month at least. What happens? Well, Seller A is going to lose out on a months worth of sales. Seller B will also take a loss too, but since he is diversified, he has a much better chance of riding out the time until the supplier is restocked without a major financial hit.

The point of the story is that if you put all your efforts into this one product and source, you are going to have issues if they dry up. There are zero guarantees that your source will always have these or that the cartridges that you are selling will not drop in demand. Seller A will start to scramble to find a replacement product. This takes time not only to find it, but to order and receive it. A week or two may pass before he can even begin selling the replacement item. Since Seller A has no sales history with this product type, he may not get the best exposure on eBay® when he starts to sell them, yielding a slow start to his sales.

Time

Time is the one luxury in life that we cannot control. No matter what you do, you cannot buy more time. You have no control over your life's events. You may have all the time in the world as a single person working a regular job. You may have practically no free time because you work 6 days a week, are married, and have 3 kids. Time and effort are necessary to be successful in anything. If you want to learn an instrument or pick up a hobby, you need time to learn these things.

What if you want to become an Online Selling Pro but have limited time because of the nature of your daily life activities? You need to do two things. You need to commit the time and you need to leverage your time.

Committing your time is straight forward, simply do it! Regardless if you are single and working 100 hours a week or married with kids and working 40 hours a week, there are going to be points where time will be difficult and limited.

As your regular job has a set schedule of time, you need to make the same set schedule for your online business. In the beginning this may be hard to nail down as you will have no idea what kind of time you need to commit. Once you have a rhythm down for your routine, you will have a greater understanding of the time you need to commit to your eBay® business. It will get easier as time goes on.

Leveraging your time is about making your efforts pay off for you in multiple. When you sell a product do you want to put in X amount of effort to only sell one of them or do you want to put in the same effort and sell 100 of them?

When selling an item on eBay®, you need create a listing. This listing process can take time, especially if you are new. When you have a number of individual listings that you need to make, it becomes more beneficial to leverage your time by getting involved with products that you can buy multiples of. This way if it takes you 10 minutes to create a new listing, it's worth the time because you would have 20 of them to sell instead of only one.

If you don't leverage your limited amount of time, your business can fail because you cannot dedicate time to its growth. Stress will kick in and you can get sloppy with your work, lose faith in yourself and your efforts. If you are limited on time for any reason, I would strongly suggest focusing your efforts by sourcing product that will allow you to leverage your time. You will be thankful, especially when you are getting started and are not familiar with everything going on.

The Start-up
This start-up is an overview. Every eBay® business is different, unique, and each owner has different visions. Use this overview to help guide you and fill in the blanks for those that need a bit of help.

Some of these are common sense, and any seasoned seller could look at this and say “I already knew that”. Use this list to get a picture of the resources that you will need in place. My goal here is to paint a picture for what your shipping area will look like.

Hard Goods

• Shipping supplies: Once you know what you will be selling you need to get shipping supplies (packaging) that work with that product. This includes boxes, bubble envelopes, or what ever you may need to ship your product safely. Keep in mind if someone orders two or three of something you will want the packaging to match that. Don't forget the bubble wrap or foam popcorn.
  
  Shipping supplies also include package tape, tape gun, box knife, markers, pens (I suggest one attached to a line and desk), customs pouches to hold international labels, and scissors.

Don't go to your local office supply store to get these items, you will be paying high retail. Google your local area for a box manufacturer. Connect with them and expect savings up to 90 % off MSRP.

• Business cards or promotional fliers. Get them printed in bulk from any online printing company. Be sure to include one with each of your orders. This will to make a connection between the customer and yourself personally. Customers appreciate knowing they can always connect with a real human.

• Computer: This goes without saying, but any decent computer made within the past few years will run most of the applications out there. I would suggest a PC. Nothing against Mac's, but the reality is most of the hardware and software out there is geared toward PC's.
• Ink jet or Laser jet Printer: Mostly for packing slips or printing shipping labels if you want to go this route. Using these printers to make your labels can be extremely expensive.
• Label Printer: A much better choice for printing shipping labels. The most popular model is the Zebra LP 2844 which uses a roll of common 4” x 6” labels. These are the sizes that UPS, USPS, and FedEx use with many of their respective programs. The benefit of the label printer is the roll stays with the printer and you don't need to swap out the paper for label paper as you would in an ink jet.
  
  You can find this printer pre-owned for about $ 125 on eBay® and the labels at a good price from many online resellers.

• Shipping Space. Dedicate a table to shipping your items out. Keep it clean. Use cabinets or hooks to keep your supplies in front of you such as your tape gun and knife. Its about keeping things organized to develop a smooth routine.

Other Considerations

Here are a number of things you should consider before becoming an Online Selling Pro. They are in no particular order.

• Taxes! I would preface this by suggesting that you consult with a tax professional before making any financial decisions. Any online retailer is now required by US law to report via a 1099 your gross revenue for any online seller that exceeds $20,000 a year in gross sales. You have the option of giving them your social security number or your business tax number if you are a registered business with the IRS.
• Keep track of every expense for your business. Not only receipts for supplies, but for losses. What if you mix up an order or your item arrives broken? You not only may have a loss for the item itself, but for the shipping expense involved. These small expenses can add up fast but can be a deduction on your taxes.

• Both eBay® & Amazon® offer a way to make shipping labels with UPS or USPS. I would encourage you to check out working directly with Stamps.com or Endicia.com for discounted rates with USPS shipments. These aftermarket programs can retrieve your orders and automatically upload tracking back to eBay® & Amazon® when you are done shipping out your packages.

• Set aside an area in your home for your business. An extra room or garage will work. Keep it separate from your daily home activities. Otherwise you will be mixing your home and business life and that can cause unnecessary stress.

• Schedule time for your business. Your boss would expect you to be at your regular job and for a certain time period, set aside a dedicated time to work on your business. This will help you develop a routine.

• Study the market. If you have a product that you want to sell see how many other sellers are also offering the same product. See what their price points and history are. Their slow sales or low prices may sway you away from focusing on that particular product.

• Patience.. and more patience. Especially in the beginning, things will be slow. Don't sit there and hit refresh on your account every 5 minutes wondering if any orders came in. If you have this kind of personality and cannot “walk away” to let the business do its thing you should consider learning how to deal with this before you start selling. It can take many months before you see a consistent sales trend.

• You need to keep on top of your competitors and the market. As I have said over and over, it isn't about buying and selling. Things change and competitors will fight back. You need to research your items to see how they are selling and what your competitors are doing.

• Keep it fresh. Always spend time looking for new product to resell. If you don't it will be like walking into a retail store that doesn’t keep it fresh with new product. Your online presence will get boring.

Conclusion
I hope you have found this short guide helpful. My goal was to give you an idea of what is involved to becoming an Online Selling Pro and to determine if this is a path for you.

If you feel as though this is something you wish to get involved with and want to learn more, I would suggest getting a copy of my book Part Time Selling: 90 Days to Online Success by Selling on eBay® & Amazon®. It covers many hot topics such as product sourcing, providing the level of customer service that eBay® & Amazon® wants their sellers to provide, and reaching the top selling levels giving you the best exposure to buying customers.

You can see where to purchase my books and more details at PartTimeSelling.com.
I can be reached at info@PartTimeSelling.com and I always welcome questions you may have about becoming an Online Selling Pro.

I appreciate your purchase and interest in my work.

-Jason Guarino

PartTimeSelling.com