Competing with bedroom traders and eBay
Discussion
I knocked the ebay thing on the head a little while ago. When I first started the margins were awesome but every month I noticed more and more competition which just drove my prices down.
In the end I was just a tax collector for ebay. If I was to do it all over again I would do something completely niche but even those avenues are hard to come by now.
In the end I was just a tax collector for ebay. If I was to do it all over again I would do something completely niche but even those avenues are hard to come by now.
jammy_basturd said:
TheAngryDog said:
I guess this is my downfall, I could never think of anything of value to add over the product. Sure customer service, engaging the customer, offering advice, but thats all I could think of at the time.
That's all John Lewis do - you need to see if there is a market to be the John Lewis of the car mod world.I sell car parts on ebay and my own site although I'm in a fairly specialist market (if you can call mid life VW's specialist?). I compete by offering good products, fast delivery and also giving advise (and lots of it) and I know I'm far from cheapest but there's no point in making near zero profit.
A lot of the big brands don't want to deal with small traders but that's another story! I am an authorised dealer for a few of the large tuning brands and have contacts for most of the other's so can sell a full range of products.
Everything I sell on ebay is kept as stock (to help me meet power seller status which reduces fee's by a fair amount) and I have 200 lines listed on my store, which is about right and does bring enquiries in for other parts not listed and also helps bring traffic to my site
A lot of the big brands don't want to deal with small traders but that's another story! I am an authorised dealer for a few of the large tuning brands and have contacts for most of the other's so can sell a full range of products.
Everything I sell on ebay is kept as stock (to help me meet power seller status which reduces fee's by a fair amount) and I have 200 lines listed on my store, which is about right and does bring enquiries in for other parts not listed and also helps bring traffic to my site
I think many do fail to understand or realise the gravity of running a business on eBay. Many assume its easy to start up on ebay and in some ways it is but no where near as easy as it used to be. eBay is knocked many a time but no one can argue with the fact that it is a huge audience you get overnight, however that audience is not just for you, its for any trader/new start up for the taking.
It used to be a case of you would get small and medium size businesses on ebay but now you will be up against the best of the best, huge corporations and businesses that started out small now have 20,000 sq ft warehouses turning over 1m plus.
Don't for one second think its a market that isn't changing - ebay is very dynamic and unless you are willing to 1) expand your product range or 2) change the products you offer you might as well quit now.
I have seen products I have bought in - sold extremely well - other sellers see this - they all start fighting over margins and its a fight to zero profit. I say good luck to those idiots let them fight. Don't waste your time and move on to the next product.
Your in business to make money - I have seen many a trader come and do this dog fight for them to realize in a few months to a few years its not worth it or they have actually made sweet f all and shut shop.
Its not about the last person standing - its about the last person standing with pockets full of profits.
It used to be a case of you would get small and medium size businesses on ebay but now you will be up against the best of the best, huge corporations and businesses that started out small now have 20,000 sq ft warehouses turning over 1m plus.
Don't for one second think its a market that isn't changing - ebay is very dynamic and unless you are willing to 1) expand your product range or 2) change the products you offer you might as well quit now.
I have seen products I have bought in - sold extremely well - other sellers see this - they all start fighting over margins and its a fight to zero profit. I say good luck to those idiots let them fight. Don't waste your time and move on to the next product.
Your in business to make money - I have seen many a trader come and do this dog fight for them to realize in a few months to a few years its not worth it or they have actually made sweet f all and shut shop.
Its not about the last person standing - its about the last person standing with pockets full of profits.
I'd definitely spend some time thinking long and hard about how you can add value (to differentiate yourself from the lowest-price brigade). Try to put yourself into the shoes of the potential buyers and work out the kinds of problems they encounter when buying/using the products; how can you help solve those problems, and can you demonstrate to the customers why buying from you makes their life significantly easier.
Taking the example of suspension, is there a niche big enough that you can develop a specialism? Fitting - as mentioned above - is the obvious way to add value, but maybe there's a market for a single-marque specialist? (As always, it helps if you are already have a good insight on a particular market through an existing interest.)
Just beware of adding pre-sales support (=value) if the customer can then simply go and buy from the cheapest supplier.
Taking the example of suspension, is there a niche big enough that you can develop a specialism? Fitting - as mentioned above - is the obvious way to add value, but maybe there's a market for a single-marque specialist? (As always, it helps if you are already have a good insight on a particular market through an existing interest.)
Just beware of adding pre-sales support (=value) if the customer can then simply go and buy from the cheapest supplier.
Id rather pay more at a shop than an ebay special. Depending on items etc i could actually take it back if it wasnt working, where as if it is broke from online i cant be bothered with the hassle, so just pay more now and shop locally.
Offer a warrenty, fitting etc.
Id happily pay £50 more for your suspension if you then offer decent fitment rates, which you then make money off too.
Offer a warrenty, fitting etc.
Id happily pay £50 more for your suspension if you then offer decent fitment rates, which you then make money off too.
Its simple to put into writing but very hard to achieve.
You need to come across like your offering something better than is already on offer.
We simply offer freebies
We add prize draws into our buyers packages why by they sign up to win stuff. (keeps them coming back)
We offer discounts for returning customers.
On larger value items we offer mixed product discounts that make some things almost seem free!
We have now launched a 24hr reply system where by all issues get replied to within minutes
Were not always the cheapest or even close but sometimes thats better! We can offer the same product but promise it next day.
The way we work our business is by selling a huge range of products, currently around 50,000 + different tools that we hold in stock and ship the same day. (hard to achieve but the same can be done from day one)
We are also in the automotive market, however a slightly different market that is car accessories and tools.
You might find a product that sells in its 1000s. Thats great! but you very quickly appear to other sellers who will just steal you idea and sell it cheaper…
Sometimes its better to sell a large range and offer a service that is hard to beat.
I know id rather buy and get it next day and pay the little bit more.
Having said all that we do dabble in the volume side and it can be done, some of our suppliers we are sole distributors on, so we sell to the shops and other online sellers as well.
Even though we do this, we still get the odd idiot who dosnt know how to make money on the web.
The way i look at it with you business idea is who not offer free returns! or over the phone help that is always available.
Everyones real goal is to take your ebay sales to your own site, so why not push everyone towards the phone number that way you save yourself fees etc.
There are a million different ways things can be done,
People rant about cheap couriers, so why not use DPD the one every one loves!
Make sure your customers know who's shipping there goods, issue them full tracking numbers and etas.
If you can achieve a happy customer base then your winning!
For instance look at BuySend
There by no means the cheapest but there feedback is amazing, there whole set up is amazing really! yet they seem to sell more and more each month!
You need to ignore the volume sellers and pick a route that is going to suit you, you'll see others come and go and you will grow your own customer base by treating them they way you would like to be treated when buying something.
Your market is specialist so a seller who cares is going to do very well.
ACEParts on here is your man to talk to, he's in the market i believe
You need to come across like your offering something better than is already on offer.
We simply offer freebies
We add prize draws into our buyers packages why by they sign up to win stuff. (keeps them coming back)
We offer discounts for returning customers.
On larger value items we offer mixed product discounts that make some things almost seem free!
We have now launched a 24hr reply system where by all issues get replied to within minutes
Were not always the cheapest or even close but sometimes thats better! We can offer the same product but promise it next day.
The way we work our business is by selling a huge range of products, currently around 50,000 + different tools that we hold in stock and ship the same day. (hard to achieve but the same can be done from day one)
We are also in the automotive market, however a slightly different market that is car accessories and tools.
You might find a product that sells in its 1000s. Thats great! but you very quickly appear to other sellers who will just steal you idea and sell it cheaper…
Sometimes its better to sell a large range and offer a service that is hard to beat.
I know id rather buy and get it next day and pay the little bit more.
Having said all that we do dabble in the volume side and it can be done, some of our suppliers we are sole distributors on, so we sell to the shops and other online sellers as well.
Even though we do this, we still get the odd idiot who dosnt know how to make money on the web.
The way i look at it with you business idea is who not offer free returns! or over the phone help that is always available.
Everyones real goal is to take your ebay sales to your own site, so why not push everyone towards the phone number that way you save yourself fees etc.
There are a million different ways things can be done,
People rant about cheap couriers, so why not use DPD the one every one loves!
Make sure your customers know who's shipping there goods, issue them full tracking numbers and etas.
If you can achieve a happy customer base then your winning!
For instance look at BuySend
There by no means the cheapest but there feedback is amazing, there whole set up is amazing really! yet they seem to sell more and more each month!
You need to ignore the volume sellers and pick a route that is going to suit you, you'll see others come and go and you will grow your own customer base by treating them they way you would like to be treated when buying something.
Your market is specialist so a seller who cares is going to do very well.
ACEParts on here is your man to talk to, he's in the market i believe
Sell your items as packs the bedroom drop shippers cant emulate, ie a back box with a heat shield, a engine cover with the bolts - not sure what you sell but pair complementing items together to make the purchase hard to copy by others.
EG we do walkie talkies with a hand charger, that sort of thing.
EG we do walkie talkies with a hand charger, that sort of thing.
DSLiverpool said:
Sell your items as packs the bedroom drop shippers cant emulate, ie a back box with a heat shield, a engine cover with the bolts - not sure what you sell but pair complementing items together to make the purchase hard to copy by others.
EG we do walkie talkies with a hand charger, that sort of thing.
Second that.EG we do walkie talkies with a hand charger, that sort of thing.
I started off as a "bedroom trader" although I kept pricing to RRP's and had a minimum margin for me to be interested. Anyone can get an account with most distributors and send items direct, but as soon as you sell a "solution" that requires some thought, collating products offline and sending out, that's where bedroom traders suffer as most won't or can't afford to buy the stock and make the packs. You have to follow that up with information though, lots of information, guides, tips, resources etc.
It's hard work as well, which means most bedroom traders aren't interested in trying to compete.
I too am setting up to sell performance parts from home.
All dropship without holding stock. I plan to advertise everything at full retail but do offers, either weekly or monthly, Like 10% off Suspension parts, or free shipping on Renault parts etc, I also thought of offering freebies with stuff, Digital tyre pressure gauge with every set of alloys, free cloth with any car shampoo, Discount on pads when buying discs, that sort of thing.
I will utilise FB, Twitter and Instagram best as possible as these are all free resourses. I will also approach forums, try and sell through these, but i want to avoid Ebay, as mentioned I would rather be more upmarket than down market.
OP im happy to chat if you want to get in touch.
-Tom.
All dropship without holding stock. I plan to advertise everything at full retail but do offers, either weekly or monthly, Like 10% off Suspension parts, or free shipping on Renault parts etc, I also thought of offering freebies with stuff, Digital tyre pressure gauge with every set of alloys, free cloth with any car shampoo, Discount on pads when buying discs, that sort of thing.
I will utilise FB, Twitter and Instagram best as possible as these are all free resourses. I will also approach forums, try and sell through these, but i want to avoid Ebay, as mentioned I would rather be more upmarket than down market.
OP im happy to chat if you want to get in touch.
-Tom.
TheAngryDog said:
I considered starting my own business (performance car parts) once, which I know is a tough market to get into. When I was looking it looked like it would be very, very hard to get off the ground as these days you can get anything you want from eBay from people who make a few pence here and a few pence there.
As a business with rates to pay (rent etc) I couldn't see how I could make this work as it would be very difficult to compete with people who are happy to make so little on every item, and that as a business would it be really worth selling something and making such a small amount on it. These sellers have very few over heads which is probably why they can afford to operate this way, but I would have wanted to do it properly with premises etc.
Has anyone else done the maths on a company where product supply to the general public (not business) and decided it wasn't financially justifiable?
One option is to have a go at drop-shipping initially, as you won't have to invest in large amounts of stock giving you the chance to test the market.As a business with rates to pay (rent etc) I couldn't see how I could make this work as it would be very difficult to compete with people who are happy to make so little on every item, and that as a business would it be really worth selling something and making such a small amount on it. These sellers have very few over heads which is probably why they can afford to operate this way, but I would have wanted to do it properly with premises etc.
Has anyone else done the maths on a company where product supply to the general public (not business) and decided it wasn't financially justifiable?
One way of competing with these so called 'bedroom traders' is to source a unique product that has a strong USP. You could try and find a performance car parts product from, say, the USA, that's relatively new, and showing signs of promise, that isn't currently selling in the UK, and try to become their sole UK distributor.
Other methods of gaining a competitive advantage include using repricing software such as http://www.sellerdynamics.com and to access discounted shipping costs a courier aggregator such as http://www.parcelhub.co.uk
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