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How to Choose an eBay Business Model

Six classic, time-tested models for selling on eBay explained

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How to Choose an eBay Business Model

There are as many different things and ways to sell on eBay as there are sellers; use this article to you chose the business model for you.

Photo: Rbouwman / Dreamstime
Thinking about starting your own eBay business? You’ve probably seen sales pitches for eBay selling kits that promise an easy route to quick riches using a secret Proven Method[TM] or Winning eBay Business Model[TM]. Often, you'll be wooed with claims that this is the one business model that only the fabulously wealthy eBay "insiders" know about.

Don’t let yourself be fooled. If a $34.95 book, CD, video, or kit were the path to millions on eBay, everyone in the world would have already done it. More to the point, not everyone in the world can be a successful eBay seller. For eBay sellers to make money, after all, they have to be heavily outnumbered by eBay buyers, and they have to compete with one another to make sales to these buyers. This is the real world, and selling anything is a cutthroat business. Selling online, where every buyer can literally choose from a world of sellers, is even more cutthroat than that.

At the same time, it's also true that there are incredibly successful eBay sellers out there, and that many of these sellers have arrived at eBay success using different business models. While this does mean that there's no One True Model[TM] that, once discovered, will lead you to eBay riches, it also means that as a prospective eBay seller you have flexibility about your business. What you really need is unbiased information.

Selecting the Business Model that Works for You

There are as many eBay business models as there are sellers, but a few general models are seen again and again on eBay. The key to success as an eBay seller is to play to your advantages and abilities. Sometimes these advantages are a matter of what you know, sometimes of who you know, sometimes of the resources that you have available to you, and at other times they are a matter of simple things like where you live.

On the next two pages are six common eBay business models, summarized and then broken down into details that you should be aware of, each detail with a rating from low to high:

  • Startup feasibility: The degree to which almost anyone can start this kind of business without having special knowledge, special contacts, lots of money, or other things that might be difficult to come by.

  • Sourcing difficulty: The difficulty you’ll have in sourcing your products (getting your hands on the things that you sell) as your business operates.

  • Overhead: The overhead (operating costs) involved in the business.

  • Competitive advantage: The advantage you’ll have with this kind of business model over other sellers on eBay.

  • Potential for success: A combination of the overall growth potential for a business like this and the chances that any individual seller who adopts it will find it to be profitable and manageable enough to continue long-term.

Read on to see the business models and their ratings, keeping in mind that for every rule in the world there are exceptions—so use this discussion as guidance, not gospel. In the end, your success as an eBay seller is all about you, your ingenuity, and your ability to satisfy your customers—eBay shoppers—on an ongoing basis.

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