Is It Profitable To Sell On eBay? Here’s What I think

Selling on eBay is more complex than selling at a physical store. There are fees and shipping charges and a few other things a seller usually needs to keep in mind. With how the website is structured, you might be wondering, is it profitable to sell on eBay? Well, I am today here to cater to your curiosity and give my thoughts on this topic.

Simply put, the answer is a big yes. It is possible to make a good profit on eBay. It is actually quite easy to make a considerably large profit selling items on eBay. A seller needs to be aware of a few things, and they can even make eBay their primary source of income.

In this article, I will try to explain everything related to making a profit on eBay as simply as possible. This will hopefully help you get one step closer to building a sustainable and profitable business on eBay. I would highly suggest you read it thoroughly to understand the nuances of it much better.

Is It Actually Profitable?

A lot of people sell a lot of different second-hand stuff on eBay. A lot of the time they do it with the sole purpose of getting rid of them. A lot of companies sell products directly. And the often used auction method can make this process a bit perplexing to a lot of people. It is very natural to wonder about the financial situation of this entire scenario.

It becomes a bigger question when you are an independent seller on the platform. Between all the big-name players how good of a chance do you have to make your sales profitable? After all the shipping charges and service fees and return issues, how much profit can you even make? The answer is, a lot if you play it smart.

The auction and competition make it seem like a very tough marketplace to be. But it is not. A lot of the complexities that scare you can outright avoid and steer clear of. If you are not ready to invest big, you can just start by investing very little. You can even start by selling stuff you already own to get a bit of starting revenue.

The large competition should not be scary to you. There is always a way to navigate the vast landscape of the online marketplace of eBay. You just have to calm down and figure out what works best for you without panicking too much.

Yes, you can make profits. Yes, you can also make it your full-time job and main source of income eventually. You cannot, however, expect to go into it and immediately start making enough profit to call it your main source of income. That can happen. People sometimes do get lucky or do get high gains from taking a high risk.

But, what I am saying is, you can’t be sure of anything. As it is unpleasant to hear, indeed, online marketplaces are not the most stable business landscapes. There’s risk involved in going all-in on eBay from the beginning too. Advisable is to go slow and figure it out gradually. That is how you will be able to ensure a consistent profit.

So, start slowly, move cautiously. If you follow the advice in this article and be careful with your business model, you can make your eBay business consistently profitable.  

How Much Profit Can You Make?

Now that I’ve convinced you that it is indeed profitable. Let’s talk about how much. I will discuss how much you can make on starting and later. Also, discuss what the average eBay seller makes and what the average profit margin looks like. This will likely help you with keeping your expenses and pricing in check.

The average profit margin after shipping and other expenses varies from product to product. You do not want to underprice your products nor do you want to overprice them. Your prices should be competitive while also keeping everything in check. You need to find a properly balanced price deciding on the market.

For small value items, a lot of sellers prefer to have up to 120-150% profit margin. While with higher value stuff, most sellers are happy with a profit margin somewhere around 25-30%. Overall, the average profit margin of most eBay sellers is around 30-40%. A small percent of high-end sellers have up to 60-70% profit margins.

As a part-time seller, your eBay earnings will hopefully be enough to make it a good side gig. Most part-time sellers make about 4 to 5 thousand USD per month on average. Even the ones who have not started long ago. 

If you keep on carrying on, your income could reach somewhere around 9 to 10 thousand USD per month. And if you decide to go full time, you can even expect upward of 140 thousand USD per year. A small percentage of the sellers on eBay even make up to a few million in sales every year.

What I have just presented to you are some of the statistics related to the earnings of eBay sellers. This demonstrates how profitable this business has the potential to be. Of course, you shouldn’t just rely on statistics. What worked for other people might not for you. But here, I have put data of even the people on the lower side of this income spectrum.

While it is true that the bottom level sellers constantly keep losing money; you don’t necessarily need to aim to be one of the top one percent of sellers. All you need to do is make sure you have enough profit to carry on forward. If you can ensure that much, then with a bit of patience you can achieve success.

Your best course of action would be to not go all in at first, but build a business patiently. Consistent growth is always better than overnight success. I will try to discuss with you some of the things you can do to make your eBay business profitable smoothly and simply.

What Can You Do To Make It Profitable?

Profitabel Business - Money Coins Growing

The most important part here is, make sales. If you don’t sell products, you do not get money, which is an obvious observation. You did not need me to tell you that. But I am reiterating that once again nonetheless. It is to illustrate the fact that you need to focus on making more sales.

You need to follow a few steps to ensure that you have profits secured. Your eBay business model does not need to be complicated. You can manage it all alone and from your phone directly even. It helps if you have someone to help you as they might be able to help you with inventory, but that is not necessary.

I will discuss a few basic steps here that you must make sure to make your eBay selling business profitable. 

1. Choose A Market

Before selling, you need to decide on what to sell. In an ideal situation, you want to focus on fast selling and currently trending products. For that, you will need to study the eBay catalog a fair bit. You need to see what is selling and what there is a need for.

You do not want to get into a market that is oversaturated with a product that is in massive abundance. As an independent seller, you most probably will not be able to provide many special offers on any regular products. You need to keep an eye on the listed and sold numbers. If something has been sold more than the number available, then that is the one.

In the beginning, your choices of products will be limited. A lot of people start by selling products they already own or picking up stuff for cheap from thrift stores. If that happens, then you would end up being a bit limited in choosing your catalog. But, that is the beauty of eBay, it’s that you can sell anything!

When you do have a bit of growth, be cautious about choosing your target audience. You also do not want to pick a niche market with very limited customers as those markets often have extremely high competition.

2. Pick Prices

Next, you would need to pick prices. Although eBay has an auction feature until recently that was the only way people could sell their products on eBay. But currently, eBay also offers a feature that allows fixed price buying and selling. That is the most advised option as it makes the sales instantaneous.

You will have to pick a good price. A good look at the catalog and the available options for items similar to what you are selling can give you a good idea. But you also need to keep in mind how wanted a product is. If a product is too high of availability, you have less of a chance of selling it at a traditional price.

You need to make your pricing competitive. You cannot charge very high prices as that would drive customers away from you and towards those with lower prices. You need to make your prices as competitive as you can while maintaining overall profits. Choosing the right price is the first step in making consistent profits.

3. Shipping Charges

Depending on your scenario, your shipping methods may vary. In a perfect world, eBay themselves would be handling the delivery, and the sellers could drive all their focus towards sales. But we do not live in that perfect world. Sellers have to figure out their shipping.

Whatever method you may decide on, the important thing I want to discuss here are the charges. The shipping charges make a notable impression on the customer, and sometimes that can even drive them to decide whether or not to buy a product.

Of course, it goes without saying that you should try to offer lower shipping charges to be more competitive. You will not always be able to offer free shipping. But, if you are making enough profits, then you should consider making shipping on some of your products free as that will help increase the sales.

4. Better Source Your Products

You might have to start with whatever you might get your hands on, but after a certain point, you will have to pick your sources. You can keep fishing around here and there for products, but your best course of action is wholesale.

Buying wholesale products and reselling them at retail prices is an old and very true and tested business formula. You can get incredible value on wholesale, and through a bit of hindsight, get amazing profits on these products. 

If you continue to source products from the same wholesale retailer, then you might even get discounts and help with inventory too. Picking a good product and finding the right wholesale supplier for you is something necessary for you in making your business much more sustainable.

5. Customer Service

The last piece of the essentials puzzle is customer service. Remember, you can’t exactly build a brand value or reputation on eBay. What you can do instead to get the trust of customers is to provide them with good customer service. 

Answering any questions they have regarding the product, solving their issues, helping them return products; are just a few things you’ll need to do in customer service. A timely service goes a long way in building a reputation on eBay.

If your sources are up to the mark, then you will not be having any frequent issues. So, customer service is not something to be scared of. That is the only personal touch you can add on eBay, so you should take advantage of that.

What Do You Need To Be Cautious About?

Cautious Cat by the Tree

There are a few tips and tricks that come after the essentials. These are not something you would be able to figure out traditionally. These are gathered from experience and a bit of smart research.

I’ll talk to you about a few of these things that will increase the quality of your business exponentially. If you keep an eye open on these things, you can avoid problems and acquire more growth very easily.

Buy-It-Now, Not Auction

Although eBay started with the auction feature only, it is now not the only option for selling products on the platform. And it is also not what your go-to option should be. eBay now offers “Buy It Now” fixed price shopping. That is the one most suitable for selling the most products.

Most customers will not wait a set number of days for an auction to end at an unknown price. There is of course a market for that, but regular products won’t sell that way. The regular products you have on your catalogs sourced from your usual sources will sell much easier at a fixed price.

Yes, there are a few rarities that are more profitable on auction. If you happen to get your hands on something rare or antique that will do well in an auction, you could go for it but “Buy It Now” is the best option for most stuff as it will also allow you to set your own competitive price.

Return Policy

It is much more preferable to have a return policy. The average customer is always more likely to buy from a seller with a return option than one without one. So, along with your pricing, your return policy should be good too.

The average eBay seller has a product return rate of 2-3%, which is not much at all. And, even if you do not have a return policy, a customer can just ship it back to you, so it is good to make that option open to customers.

You can do customer paid returns if you want. Some sellers offer free returns on a set number of days. Something like a 7-day or 30-day free return can end up making your product offerings much more lucrative.

Be Creative With Your Product Sourcing

You can sell anything on eBay. So, you can source them from anywhere too. Apart from the traditional wholesale suppliers, you can also look into garage sales and thrift stores. There are a lot of second-hand stores out there if you look for them, from where you can source a lot of products.

A lot of thrift stores have days when they have increased discounts on certain products. Always be on the lookout for opportunities to get quality items at a lower cost. You can even buy packaging and shipping items on eBay on wholesale to decrease your packaging costs.

You need to be creative with sourcing. Go out there and look for opportunities to decrease costs and increase profits.

How I Make $42,000 Per Year Selling Stuff on Ebay by Hairy Tornado

Final Thoughts

Thank you for reading my take on this all the way through. “Is it profitable to sell on eBay?”, I hope I was able to answer that question and explain to you a few pieces of advice to make your work easier.

EBay can be Profitable, no doubt about it, but there is so much involved there, and it could be a hustle with shipping, refunds, etc. Check out my #1 Recommendation on having your own business with a flexible schedule, and no shipping, refunding involved. You’ll learn about content marketing strategies that will enable you to build your online business from scratch

To Your Success,

Haly

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