Investing Money in Your EBay Business: 5 Things to Consider

Opening an eBay business can be very rewarding. Many people boast of the low overhead and maintenance costs of selling on eBay. It can be done from anywhere, even your own home. While the costs may be relatively low, there have been many stories of people losing large amounts of money from investment mistakes they made for their online business. What are some of these mistakes, you ask?

1. Not researching the market. eBay can be ruthless. One day something’s hot and one day it’s not. eBay really requires you to carefully research your market before investing a dime. Carefully notice bids and sales on items before you consider selling them. Do they move fast? How many have sold? Are they priced well? Sites like can track the sales of items, giving you an idea.

2. Confusing the local market with online market. What sells locally may not be good to sell on eBay and vice versa. In recent times, successful, well known brick and mortar stores have been trying to open up stores on eBay and many have been pushed out by the competition. Why? People buy things locally for various reasons. People online are often bargain hunters looking for very unique products are very low prices. This makes it hard for sellers in the local market to compete.

3. Hasty investing. While it may be a slow and long process until you get your first sale, many sellers who get their first few sales believe it’s a sign to buy more and more of that product. They do this, only to find that the product stops selling after a week. Because there is no real client base or repeat customers with online sales, your product may easily lose steam.

4. Investing on credit. I once read a story of a woman who invested in children’s clothes on credit to start up an eBay store. She ended up in lots of debt for a business that never made her any money. Selling on eBay is always a gamble, even if you think you have the most rare, in demand item to sell. It’s never worth getting in debt for.

5. Not being a “test-out” investor. Let’s face it. Unless you are a grocery store, bulk buying products is pretty silly. As mentioned above, there is no real assurance that your product will sell day after day. Instead, test out each product you’re thinking of investing in. Never buy more than one or two of the product unless you can confirm a solid sale record. This almost ensures you don’t invest too much, always testing out products rather than bulk buying.

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