Amazon and eBay : Episode 4 of the Hustle Lab
Having ordered three boxes of middling-quality electronics (among other things), I now had to offload them on these two platforms.
The general impression I had from the testimony of others who have done this and bragged about it on their blogs was: This is easy! Just throw it up there and you’re done.
It’s not quite so simple.
Welcome New Seller!
Greetings, and welcome to eBay. Your current reputation is – untrusted person from somewhere on the internet. You currently have… zero positive reviews and… zero sales to your name. Please enter your product details below so that the eBay community can begin to ignore you in earnest.
Ok. So perhaps it’s not quite that bad. But it’s close.
One object I wanted to sell had seemed like such an obvious item to flip. I got it cheap, it would sell for more, I could afford to undercut existing sellers. Then I discovered this little line of red text under the price of one of the other sellers:
That’s a credibility signal I can’t compete with, and so while silently grinding my teeth I dropped my price a further 10% to give potential buyers an additional incentive to try out an unknown seller.
As with most things, experience and reputation count, and both are a function of time and engagement. If you do this for a long time, you’ll get the kind of 4000+ positive feedback score that provides confidence on a platform like eBay. Until then, you’re playing at a disadvantage.
Enter Description Here
I have yet to understand why the eBay item description is so important. To my mind, most people know exactly what they’re buying, and the description is so far below the page fold (the bottom of your screen when you first start looking at the page), that most people can’t seriously go looking for it all the way down there.
But I’m wrong. The item description is almost as important as the title, which must be so keyword-heavy it sinks through solid stone.
On Amazon, your item inherits the description of all identical items on the site. On eBay, you have to provide the photos and description of each item you sell, in detail, using an editor that comes from teh dark ages of the internet. If you don’t know HTML, you’re in serious trouble.
I spent ages finding photos and rewriting or stealing text from manufacturers websites to resell their ex-display items online. Getting the formatting right is a real challenge because eBay’s “preview” tool doesn’t actually show you a real preview of the final page, so experience is valuable.
You’re Not Allowed To Sell That Here
Amazon make things slightly easier, but the site is also a bit more intimidating.
When I tried to put up some branded iPhone recharging cables, I was informed that those can only be sold if you’re an accredited seller of that brand.
I discovered this only after having purchase a fairly large stock of these cables, and since they are all sealed in their original boxes, it’s one of the better parts of my overall stock. Mailing each individually is going to be a real pain, but that’s what I’ve unfortunately let myself in for, since they cannot be listed on Amazon.
The same applies to all sorts of branded products, from the obvious ones like Apple, to some less obvious ones like Anker.
The Buy Box – and Everyone Else
Amazon has what is known as the buy box, which is where you probably click on most of your purchases. It’s at the top right of a listing and allows you to rapidly purchase form the preferred supplier of that product. Often the preferred supplier is the manufacturer (iPhone headphones are sold by Apple, for example).
80% of the volume sold on Amazon goes through the buy box. You can compete for it, but it requires experience, professional status and lots of sales volume to win the buy box from whoever has it.
As a consequence, for every item I sell, my items can only be found under “Used and new”, a small link under the buy box where you can try to buy the same products at a discount.
20% of volume goes through used and new, which means I’m automatically cut off from four fifths of all the demand on Amazon.
The Rapid Upsell
Selling as an individual on Amazon works if you have a few books or a couple of unwanted items to offloa. If you’re looking to do even a modest amount of volume, the listing fees quickly add up and it makes sense to pay the £25 monthly professional seller fee to get rid of the £0.75 listing fee.
Owned Payment Method
eBay more or less forces the use of paypal on the site, by providing guarantees to buyers only if the payment method is paypal. Paypal then takes what is – by commercial standards – an exorbitant cut of the money as it flows through its systems.
In fact, the value chain of auction flipping is so utterly awful from the point of view of the entrepreneur that it’s a wonder people do this at all. I’ll write an entire article ont hat because it deserves the analysis.
Once the buyer pays eBay, you get two emails in quick succession:
First it says “Congratulations! You’ve sold an item.” Then it says, “You can’t have your money yet, we’ll hold onto it for 21 days if you don’t mind.”
While I understand the reasons, it’s a little offensive when it happens for a dozen times in a row.
You Really Want FBA
This is the conclusion I came to after just 3 days of handling sales myself. If you can outsource this to Amazon and have them deal with it, it’s a huge weight off your back.
That means using Fulfullment By Amazon.
You send them your stock, arrange your listings online, and they take orders, ship to customers, handle returns and deal with all the post and packing.
FBA is, however, much more complicated than just listing an item, since the goods need to be prepared in such a way that Amazon can rapidly and automatically scan and stock your items on arrival. There is therefore a significant amount of learning to do before you can put that into operation.
Since I don’t have a laser printer at home, I’m using he office printer to get the labels ready, and it’s taken me almost a week to get everything ready to send. The boxes left home a couple of days ago and for some reason have yet to arrive. There will be a whole article on the Amazon FBA experience as well.
But for all the hassle, Amazon FBA seems to be the way to go if you want to do this as a side hustle. THere’s no way it’s worth coming home from work every evening and having to worry about packaging, postage payments and finding time to get to the post office or the local Hermes depot.
If nothing else, the logistical mess is the main reason so far I can see myself deciding this isn’t the side hustle for me.
Neither eBay nor Amazon is all that complicated really.
The only way to learn how they work, however, is to jump in at the deep end and start selling stuff.
Prior to starting, you need to understand all the payments that these different organizations will take from you as you try to sell your products. Otherwise you could find yourself with some unhappy surprises.
As an example, a typical eBay sale includes :
- Listing fee
- Referral fee
- Paypal fees
- Shipping cost
A typical Amazon sale (without FBA) includes :
- Listing fee (or monthly professional seller fee)
- Referral fee
- Shipping cost
Neither platform is easy, however. On eBay you need to craft listings that convert if you want any hope of cometing with other semi-professional sellers on there, and on Amazon you need to build an understanding of their back-end system and how they manage your stock and payments.
In all cases, Amazon is easier than eBay, but the prices are different on the two platforms and Amazon has some restrictions on what it will allow you to sell.