Online retailing/ecommerce

[Farmer Geddon]

A friend of mine gave up quite a lucrative career in IT some time ago now to focus on the online selling he had been doing from an outbuilding in his garden.

I thought this stuff was a bit 'old hat' with ebay selling and the like being a bit of a fad for a few years. However, he's so busy that he's moving to a small industrial unit as he doesn't have the space to store the stock he's turning over! He's also hinted I should have a go, as I work from home anyway. Hinted that it's fairly easy money aside from dealing with the awkward customers and ebay/Amazon rules etc.

Anyway, does anyone on here do something like this? Is there really still money to be made? Curious/Interested to hear any stories or advice on the matter as the Internet is terribly cluttered with nonsense around that sort of thing.

Cheers

FG

[big ant]

Would be interested too, as son is close to doing the same, jumping from desk-bound low paid office work to 'drop-shipping' model... Thanks.

[foliedouce]

The short answer is, yes you can still make money from it but it's not easy and pretty much all the low hanging fruit has gone.

I'm no expert as I've only got involved in online in the last couple of years, but in my experience you need:-

o To buy cheap - online is highly cost sensitive

o Get exclusive distribution rights for whatever you're selling (this will help you avoid the race to the bottom on price and reduce competition)

o And / or Source directly from manufacturers, cutting costs and enabling you to brand your own products to differentiate, even if they are ultimately the same as other peoples. This can be really useful for search optimisation both through search engines and on the online market places.

Then you need to learn a shed load about online marketing (PPC / Google shopping / SEO blah blah blah), spend a load of cash on this to get you up the search rankings / build trust in your site / products / brand.

It sounds a lot easier and cheaper than it actually is.

There are loads of threads on here about this subject, suggest you search them as you will get to better informed advice than I can give.

Good luck!

[MrSparks]

It's not as easy as it looks. But at the same time, if you have a good product in a good niche then it's not /that/ hard to start getting sales.

The key for me has been to find a niche and add value. I'm continuously working on my site to answer questions, provide info etc. My site is no where near good enough on a content front yet, you need to be the place people find when they google random questions about their requirement. Don't underestimate how hard it is to build a quality site with a lot of decent content, even for relatively few products.

It's also quite a long game I think. My e-comm business now pays for a unit and staff but I started in my spare bedroom and I have other businesses so I'm not relying on a wage. If I needed a wage at the start I think I'd either be finding it a lot harder or I'd be working part time to pay the bills. Now I can pay my way relatively easily, even part time. But it's taken 4 years and a lot of hard work to get here, and I'm still small fry in my niche. We've got a long way to go yet.

But the problem is, drop shipping... if you go to a drop shipping company you'll just be buying all the same stuff 1000 other people are listing on eBay and websites. The margins are usually pretty bad too and you're putting your trust in a third party company who won't give a monkeys about you. It's not a good foundation to build a business on.

I've set up good trading relationships with key supplier and over time they've started shipping direct for us, much more reliable as we trust them a lot more and they want our business. We also buy and hold a lot of stock of the faster moving items. We've also got our own products, distribution of certain products and are very tied in with another product.

Our focus at the minute is to improve the sites content, and continue growing organically. After that I think it's really find more own branded, unique products otherwise you risk competing on price.

And lastly, if you want to sell common items, electronics etc, forget it... you won't stand a chance.

[jammy_basturd]

I imagine a career in IT has set up your friend nicely to ease into ecommerce.

[addsvrs]

I do it in a simple buy cheap sell for more model on Ebay
Is it hard ? Absolutely.
Can you live off it ? yes
For me what makes it viable is working from home, I looked at units when i first started and even with local council help for new businesses it was still around the 400-500 a month before bills. My shop on Ebay costs me 10% of that with a potential footfall way in excess of what i could hope for via a bricks and mortar place
Instead i converted our large garage area into and office / store room, expansion last year was 2 new sheds lol and I reckon im at about 80% capacity.

One thing i underestimated was how much work you have to put in before you even make a £1. As its just me I do everything, sourcing / negotiating / buying / prep / listing / packing / despatch. Then you have the constant battle keeping costs down ie packaging.

But by far the most stressful thing for me is Customer Returns. Its now increased to 30 days on Ebay. If there is one thing that will force me to pack it in, it is this.

[DSLiverpool]

Moving to a small unit - this is where his over head free model starts to feel pressure, if sales drop he has bills to pay and thus sells cheaper to keep cash coming in thus the spiral starts.

He should have gone from home - fulfilment company / self store - own unit putting a smaller degree of pressure on his cash flow.

[jays16]

I used to work for eBay a few years back helping sellers get more exposure for their eBay shops with a new tool. I used to speak to many sellers and ask them how they did it, some were very simple as finding a few things in their lofts/sheds, auctioning them off and realising they can make some money.

Once they noticed, they hunted for suppliers, negotiated and started selling - BOOM, eBay business started!

My tips from learning some things from them, try some products but start auctions at 0.99- sounds silly and you may think you won't get much but watch towards they end of the listing the prices go up- eBay like to push these up the rankings as they are more attractive to buyers (just have a look at people who put fixed prices and a reserve in, usually no bids!)

If you can also, find something very niche - it will help but hard I know as the Chinese will copy you off and the fact most things are already available on there.

Also have a look at a took they have developed that shows trending products that are bought along with many metrics you can sort by, called www.terapeak.co.uk

Finally just research, here is an example of tips from them (seller): http://www.ebay.co.uk/gds/Make-the-BEST-PROFIT-on-...

Once you found your formula, you can probably scale up and find a warehouse :-)

[DSLiverpool]

jays16 said:

I used to work for eBay a few years back

The chinese have invaded with false UK address details and free 21 day shipping since then chum.

[Lewi25]

I'm desperate to this, worked in web design for a few years and have sold things in the past on EBay so I know some things regarding PPC, SEO, Marketing etc. A friend of mine (who I worked with in web design) is making a killing doing this right now.

He's selling a friends product on EBay and turning over on average 800-1k per month, and now he's bringing a product over from the USA which I think will make him a lot of money.

Fair play to him!

[jammy_basturd]

Making a killing? If he's turning over 1k then he'll be lucky to have £400-500 profit. That a month doesn't seem like much.

[Lewi25]

jammy_basturd said:

Making a killing? If he's turning over 1k then he'll be lucky to have £400-500 profit. That a month doesn't seem like much.

He buys the product from a friend but yes that probably is his profit. He's recently married with 4 kids and only 26 so it's a lot of money to him and his family.

I think his next project will make him a lot more, I just thought it was cool that even though he's got a few dependents he's still finding energy to have a good go. Top bloke as well, hope it works for him.

[Ean218]

jammy_basturd said:

Making a killing? If he's turning over 1k then he'll be lucky to have £400-500 profit. That a month doesn't seem like much.

Blimey, if he's making a 100% profit on Ebay, then where do I sign?

That sounds enormously unlikely.

[AlanQ]

DSLiverpool said:

The chinese have invaded with false UK address details and free 21 day shipping since then chum.

This is a huge issue now. Years ago consumer were wary of ordering from outside the UK, now most don't care as they know paypal will protect them and ebay always find in their favour if anything goes wrong. When you have the factory selling direct to the consumer its very hard to put yourself in the middle. You need to find a way to add some value, preferably by bundling with something that others will find hard to source or copy.

[DSLiverpool]

AlanQ said:

DSLiverpool said:

The chinese have invaded with false UK address details and free 21 day shipping since then chum.

This is a huge issue now. Years ago consumer were wary of ordering from outside the UK, now most don't care as they know paypal will protect them and ebay always find in their favour if anything goes wrong. When you have the factory selling direct to the consumer its very hard to put yourself in the middle. You need to find a way to add some value, preferably by bundling with something that others will find hard to source or copy.

Bundle, specialise or die (or dye lol) - a few things exist that the Chinese cannot retail easily but Aliexpress, baba and ebay mop up a lot of business.