Last week I shared facts about the Top selling items on eBay. But these are not necessarily the best items to sell on eBay!
In this post I’m talking about the method we used to decide which items to sell on eBay, on our way to $100K / month in revenue.
How Do We Find The Best things to Sell On eBay
First let me explain my initial claim – eBay’s top selling items are not necessarily the best item’s for you to sell on eBay.
If you look at the list of eBay’s top selling items, these are mostly branded items with a high demand and tons of supply (sellers who offer these items for sell).
Let’s talk about an Iphone for example:
The problem with these is that there are usually very strong players you’ll be competing against, those giants will win over you in every aspect –
Lower Price – they have a stronger buying power, which means they will have stocks of 1000’s of units and will necessarily have lower prices than you. This is how BestBuy, Wallmart and the like’s can offer the lowest prices – they have enormous buying power.
Faster, cheaper Shipping – The bigger you are, the better, faster and cheaper your shipping service becomes. Large merchants have special deals with shipping services which you as a small seller cannot get.
Think about Amazon and the kind of deals they get with their shipping providers. If your’e interested to see how eCommerce looks from the eyes of the biggest player in the world, I recommend reading ‘The Everything Store: Jeff Bezos and the Age of Amazon’ – A fascinating read for any eCommerce enthusiast.
Faster customer support – Large merchants who sell “HOT” items like the Iphone know that fast reply to customer messages wins sales, so they have dedicated personnel to customer support. Small sellers just can’t afford dedicated customer support. We do everything ourselves – Research, create listings, package and ship and answer customers… We just can’t provide the same speed of support a dedicated agent can.
Small profit margins
eBay’s top selling items are usually sold for small profit margins as the competition is fierce. The business model is usually – Many sales with low profit per sale.
The problem here is that you need to have a really well oiled logistics to be profitable in that kind of business, every aspect of your eBay business needs to be optimized to the maximum to squeeze a profit.
For most small sellers the cost in time and effort of processing a $1 profit order is pretty much the same as processing a $20 one.
This brings me to the first concept we always used when searching for the best items to sell on eBay –
Look for high cost, high margin items
My rule of thumb is a 3 digit price. I love selling items priced above $100, these items usually have enough margins to sustain a business.
As I mentioned above – the cost of processing an order for a $1 Iphone cover is pretty much the same as processing a $150 Car GPS device.
The margin is obviously much higher for the latter…
As small sellers with limited logistics capabilities, this business model allowed us to concentrate on optimizing our listings and growing our sales rather than wasting most of our time on order processing and customer support. With large volume sales, you are forced to invest most of your time on logistics – just to sustain the flow of orders.
How to conduct the search
There are automated research tools out there, but I always prefer the “rush” of discovering items live on eBay while conducting manual search. It always seemed like a more accurate, better connected way to do the research.
People say that Warren Buffet’s secret is that he does no shortcuts, he reads through each and every annual report of the companies he buys shares of. Maybe there’s some wisdom to it 😉
Here is how i conduct my research:
I manually go through eBay’s categories to look for ideas for items that might cost more than $100.
For this example I went to “Monitors, Projectors & Accs” –
Next, I go to advanced search to filter the items that cost more than $100 –
This way I filter the search results to show potentially high profit items.
But high profit margin by itself is obviously not an enough indication that a specific item is among the best items to sell on eBay.
Let’s move on to the next concept –
Look for “New”, “Buy it now” items with many “sold”
Filter out the “auction” type listings, they won’t tell you much about the demand for an item.
Look into the “Buy it now” listings, and search for those who have many recent items sold, this is critical!
You might find items with many “sold”, but those transactions may have been generated months ago, making the item non-relevant.
Click on the number of sold items to see exactly when were the last sales generated –
In this case that’s an interesting item – It has a 3 digit price and it has decent recent sales.
So now we found an item that should have a nice margin, and has a good demand. But this is where the interesting part starts – A high price and a high demand can still be an eBay “best seller” sold by the biggest players that you won’t be able to successfully compete with.
The next 2 concept are the ones who made the difference for us:
Look for unbranded items
I absolutely LOVE selling unbranded items or small brand items. This is where there is a ton of room for creating value to the customers while staying under the radar of the bigger players.
I’ll explain my point with our own example:
We received an eBay award for having the “highest conversion rates” for selling UNBRANDED car GPS devices.
If we were to sell “Garmin”or “TomTom” branded devices, we would find ourselves competing with big players with no competitive advantage whatsoever.
By selling an “unknown” brand – we were able to offer our customers unique value, and bite off the market share of the big players.
By listening to customers and constantly optimizing our eBay listings, we were able to find and push the right buttons –
We knew which features customers wanted the most, and made sure our listings clearly convey the message that our devices offer these.
Our devices were better priced than the branded GPS’s, and while there are many customers who only shop for brands, there are many other who are happy to go with an unbranded or a small brand item to get a better deal.
The big players usually have no interest in unbranded items, as these require work that they are not set up to do – building the brand.
Big merchants are a logistic machine – they want to get a well branded, well advertised item with high demand, and shove it through their funnel from the supplier to the end customer. They don’t have the capability to give any special attention to a specific line of products.
This is where we as small sellers bring in our unique value! We are happy to devote our full attention to a limited number of product lines, because we are happy with $10k-$50K a month in sales, and we don’t have a huge logistics machine to sustain.
This bring me to the importance of focus which I mention in almost every post. As a small seller – your true advantage over the big player is focus!
You are able to devote your attention to optimize your listing and constantly improve the sales for your products. You are able to provide expert, personal customer support. You are able to listen to your customers and understand what exactly are they looking for and source your products accordingly.
Big players won’t usually do the above, they would rather buy 100,000 units and shove them through the system without caring about branding. Big players have a focus of their own – they usually focus on logistics. Read the Amazon book I mentioned above, it’ll give you an idea of how they work and think, and where you can bring unique value to the customers that the big players can’t.
This point brings me to the last concept –
Look for items where you can add value
Ok, so we found an item that probably has a nice margin, it has decent sales, it’s unbranded which means we won’t be competing with large retailers. But why would anybody buy this item from us, and not from the sellers we found in our research?
Here’s why –
Here is how the listing description I found in my research looks like –
I absolutely love finding listing descriptions like this – They leave so much room for improvement!
If this seller can generate decent sales with a listing looking like that, my head starts spinning when I begin imagining how much better-converting of a listing description I can create for the same product and generate much more sales than this seller does!
Professional listings create value for your customers
It’s important to understand that by investing time and effort into creating a professional listing description, you are creating real value for your customers.
There is an abundance of products out there, it’s hard to understand if a specific product is the right choice. By researching the aspects and features the customers are looking for, and creating an appealing listing that quickly helps them come to a positive buying decision – your’e saving the customer a lot of time and effort, and make them feel they are in good, professional hands!
This is exactly how our journey from zero to $100k a month started –
I purchased a non-branded, $100 GPS device for myself from a non-professional looking listing, I then called my partner Max and told him – “We can make a business by selling exactly the same GPS with a much better looking listing description”. At the time we had to learn Photoshop to create better listings, we figured there must be an easier way to create professional eBay listings, and this is why we built CrazyLister and the rest is history… 🙂
Oh, one more thing…
Once you find the best items to sell on eBay, you’ll want to find a supplier –
I previously wrote about how we sources awesome reliable supplies for our eBay business.