MAKE MONEY ON eBAY ~ Product Sourcing Criteria

by Bob Hamilton

Locating products is a prerequisite for those who want to make money on eBay. It is also where the real fun begins. At times locating products can be like looking for a needle in a haystack. That is especially true when trying to add ‘hot’ products to your offerings. It is possible to locate almost anything, but for the ‘hottest’ products, the price that will be required will mean little or no profit.

Start by examining your main suppliers. Look at a set of criteria similar to this:

v Products Must be in Your Core Sales Areas

v Product Quality is as Represented

v Customer Service Must be Outstanding

v Reasonable Prices

v Prompt Delivery

v Products must be in our core sales areas – for a supplier to be on your list, they should handle products that are within your core sales areas. To make money on eBay, every supplier must be able to support your core business area, with other ‘great deals’ as a bonus. Purchase and then pass those ‘great deals’ onto your customers.

v Product quality is as represented – this is really about trust. You must be able to trust your suppliers. When they say that a particular product is a certain way that is exactly what you expect to see when the product arrives. When they recommend a product that you are unfamiliar with, you need to be able to count on that recommendation to be true. If you cannot trust your suppliers, eliminate them from your list.

v Customer service must be outstanding – you should expect nothing less than outstanding customer service from your suppliers. This includes prompt replies to questions, quick turn-around on purchases, and notification of ‘hot deals’ when they become available from the supplier.

v Reasonable prices – most eBay businesses are on a very tight profit margin. You need to count on your suppliers to provide the lowest possible pricing on their products. If there are ways to reduce prices, you need to know. The less you spend on products, the better the pricing for your customers! Everyone wins with this approach.

v Prompt delivery – you should look for two things in delivery. The first is pricing. As fuel prices increase, freight becomes a bigger and bigger part of the overall cost of merchandise. Look should to your suppliers to do everything possible to keep freight costs down. (We have also started working with another business to coordinate shipments, for example. By combining our freight, we can typically obtain lower freight costs.) The other piece of the freight equation is speed of delivery. Once you’ve paid for the merchandise, it is money that you need to turn around to invest in new merchandise as soon as possible. You cannot make money on eBay if you pay for freight and then have products just sitting in someone’s warehouse. To that end, expect your suppliers to ship immediately upon receipt of payment. Be sure to track your incoming shipments to ensure delays are minimized.

The list actually looks much like the list that eBay buyers use when they decide whether to bid on products, and then whether to give positive feedback or not.

In addition to your good old standby suppliers, develop a back-up list of second-tier suppliers. These suppliers are either recommended by someone you trust, or that have found at tradeshows, in newsletters, or through some other means. Possibly you have completed only one or two transactions, but some issue kept them from making your main supplier list. Look to these second-tier suppliers for products when your main suppliers cannot help with a specific product that will make money on eBay.

As a part of the process, ask each supplier that cannot furnish a desired product to recommend another source. While this rarely meets with success, there will be times when you hit a homerun using this approach.

If your main suppliers and second-tier suppliers are unable to provide a product, conduct an internet search. When you reach this point, know that you are going to be investing a lot of time not only looking for the right supplier, but also in investigation of prospects.

Before we ever deal with a new supplier make sure that the supplier can provide the desired product. Work to determine a price. If all is looking positive, ask for references before you buy. Only after checking references should you move forward with a purchase.

Always be very conservative with your first purchase from a new supplier. There are just too many unscrupulous sellers who provide inferior products, poor service, or have other issues. You will not make money on eBay with these problems.

Don’t forget that many who make money on eBay manufacture their own products. This is another great way to do something that you really enjoy for a profit!

To Your eBay Success!

(C) 2007 Bob Hamilton All Rights Reserved

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