Before I begin, I want to thank Pete Sampras for providing the inspiration to write this letter.
You’re 25 and about to start your MBA studies (and you know Sampras well since he’s well retired by the time you read this).
You’re still not sure what career path is the perfect fit for you, but you’re certain that you don’t want the typical 9-to-5 job that comes along with having to put a company sticker on your leased car. Your long-time friend Victor, with whom you mostly share drinks, will offer you to start an online business by selling on eBay.
I know – you never sold anything online; hell you never bought anything online either! You can barely turn on your laptop without calling technical support! Don’t worry about all that, just follow with your instincts. You have the ability to learn quickly, execute well, and that’s all you’ll need at this point.
#4: Learn From The Best (not just the best in eBay)
A word of advice just before you upload your first eBay listing: there are many entrepreneurs who’ve walked the path you’re about to take; some of them are kind enough to share their experiences and offer insights, so take the time to read their blogs and try to implement just one takeaway at a time. Some of my favorites are: Alex Turnbull, Andrew Youderian, Neil Patel, and Jason M. Lemkin…I’m sure you’ll like them too.
#3: Choose Your Suppliers Wisely (and yes, it takes more time)
The first suppliers that will be willing to work with you are Chinese and you’ll be thrilled that someone is actually willing to dropship for you – an unknown individual from a small country in the Middle East. They are hungry to make money just as you are and will offer ridiculous prices, but it will cost you an account suspension due to violating eBay product authenticity rules, which isn’t worth it. Be very selective with whom you do business, ask your suppliers to:
- Provide reference to other dealers they work with in order to receive feedback from them.
- Send you a sample product (even if you have to pay for it) so you can examine it firsthand.
- Commit to being able to handle at least 20 shipments a day.
- Commit to being responsible for quality issues at their own expense.
It will deter some of them, but it will separate the good from the bad and will save you a lot of headaches.
Remember I talked about account suspension? It may happen more than once, so to be on the safe side, open more than one eBay account. This will allow you to still earn income while one account is suspended and will give you some breathing room to fix problems with the suspended account.
Same goes for working with more than one supplier, you’ll do well by contacting a few suppliers because your dependency on any one supplier will eventually taper off. I’m proud of you for doing so!
#2: Adopt the ‘Long Term’ Mindset
After a year or so you’ll be earning decent money. It’s at this point you’ll understand the potential for profit growth and will be eager to expand. However, realize you’re only just beginning and need to focus on your customers’ happiness instead of on your bottom line. Customer satisfaction is the key to increasing profit!
Be willing to lose money in the short term in order to gain more later on. Making your customers happy goes a long way, so try to learn it sooner than later and avoid the mistakes I’d made.
By 27 you’ll be making good money (and you’ll forget all about ever wanting to be a consultant at McKenzie), working with 30+ suppliers from all over the world, and have multiple eBay accounts… it’s a great start, but remember, you’re dependent on another company! Let me explain: no matter how many eBay accounts you have and how well they’re doing, your business depends on where eBay is going. eBay may increase fees for sellers, increase standards for ranking high in search results, or go after the large corporations and this will make it harder for you to compete. To counter these issues, start your own website, where you’ll have full control plus your own brand identity. Do it now, don’t wait! You have available funds and you’ve brought in great employees to execute the plan, so go for it!
#1: You Gotta Focus (and then focus some more)
At 28 your hard work will get noticed by eBay corporate, they will see how well you’re doing, and after meeting you in person they’ll be excited to use your set of skills in order to help other businesses grow as quickly as you’ve done. By that time you’ve built a nice piece of software to manage all your order processing which will help you automate some of the daily tasks and allow you to concentrate on growing your business (yes it sounds crazy, I know! You didn’t physically build this software because coding isn’t your forte… some things won’t change! But don’t worry about it, Victor is awesome at this stuff so you don’t have to be!).
eBay will push you to offer your expertise as a service to similar online businesses like yourself; you’ll be entering a whole new business environment. In January 2013, eBay will award you with a certification of achievement for the highest conversion rates among the Israeli sellers community during the first official eBay event held in Israel. You will receive a lot of media exposure and businesses will start approaching you to ask for your services. You’ll be very excited with this new business opportunity, but it won’t be beneficial for you in the long run and will distract you from what you really should be doing. Trust me, don’t go down this path.
You will learn that FOCUS is one of the most important human traits to be successful. I want you to comprehend this now as this will save me (well…you) a lot of hassle.
Listen kid, you’re young and the road is long, don’t plan too far ahead. As Baz Luhrmann said in his Sunscreen song: “The real troubles in your life are apt to be things that never crossed your worried mind; the kind that blindsides you at 4pm on some idle Tuesday”.
Work hard, play hard, and the rest will figure itself out.