Know Your eBay Marketplace
Just as successful stockbrokers know about individual companies, they also need to know about the marketplace as a whole. As an eBay seller, to get a leg up on your competition, you need to know the big picture, taking marketing trends into consideration. Here are some questions you should ask yourself as you contemplate making serious buckets of money by selling items on eBay:
What items are currently hot?
If you see everyone around you rushing to the store to buy a particular item, chances are good that the item will become more valuable as stocks of it diminish. (iPhone accessories?) The simple rule of supply and demand says that whoever has something everyone else wants stands to gain major profits.
Big-box warehouse stores like Costco usually have a full stock of popular items because their (very savvy) buyers purchase by the truckload months in advance — how about visiting a warehouse store to find items at discount?
Do you see a growing interest in a specific item that might make it a big seller?
If you're starting to hear buzz about a particular item, or even an era ('90s nostalgia? '60s aluminum Christmas trees? Who knew?), listen carefully and think of what you already own (or can get your hands on) that can help you catch a piece of the trend's action.
Should you hold on to this item and wait for its value to increase, or should you sell now?
Knowing when to sell an item that you think people may want is a tricky business. Sometimes you can catch the trend too early and find out that you could have commanded a higher price if only you had waited.
Other times, you may invest in a fad that's already passé and find that no one's interested anymore. It's best to test the market with a small quantity, dribbling items individually into the market until you've made back the money you spent to acquire them. When you have your cash back, the rest will be gravy.
Is a company discontinuing an item you should stockpile now and sell later?
Pay attention to items that are discontinued, especially toys and novelty items. If you find a collectible item that a manufacturer has a limited supply of, you could make a tidy profit. If the manufacturer ends up reissuing the item, don't forget that the original run is still the most coveted — and valuable.
Was there a recall, an error, or a legal proceeding associated with an item?
If so, how it affects the value of the item takes a back seat to eBay policy: An error item, okay. But items that have been recalled for safety reasons can't be sold on eBay. For example, a toy recalled for safety reasons may no longer be appropriate for the kids, but even if it's rare and collectible, you still can't sell it on eBay.
But here's another angle: Consider that stock shares of (and any paperwork to do with) the now-defunct Enron Corporation became highly prized collectibles after the scandal hit; they still sell on eBay as collectibles.
Some people like to go with their gut feelings about when and what to buy for resale on eBay. By all means, if instinct has worked for you in the past, factor instinct in here, too. If you've done some research that looks optimistic but your gut says, "I'm not sure," listen to it; don't assume that you're just hearing that lunchtime hot dog talking.
Try testing the waters by purchasing one of the prospective items for resale on eBay. If that sale doesn't work out, you won't have invested a lot of money, and you can credit your gut with saving you some bucks.