Can eBay Make You Rich?

adamlazz writes "For 11 years, eBay has been a great resource to buy or sell goods without leaving your computer. And with many stories of people getting rich exclusively from doing business on eBay, NewsFactor has decided to go in depth with these stories, and explore what it takes to really make your million on eBay. From the article: 'A tiered system designed to reward qualified sellers, the PowerSeller program is by invitation only, and has a number of criteria that must be maintained to keep the designation. At the lowest level, Bronze, a PowerSeller must average at least $1,000 in sales per month for three consecutive months; have an account in good standing; and get an overall feedback rating of 100, with at least 98 percent of the comments marked as positive.'"

Comments

Why couldn't you get rich via EBay?

[0racle]

If you have enough of something people want at the right price then why couldn't you get rich selling things on EBay? It's not really any different then selling things in a shop or through your own website.

Re:Why couldn't you get rich via EBay?

[TWX]

It's like anything else. It's a little bit of creativity, a little bit of business savvy, work, and time. For those of us who are too lazy to go through this route to make our way there are 9-5 jobs. There are those whose job is solely to buy wholesale and sell retail, and they've been there since the day of the trader with his horse-drawn cart rolling into town. eBay just tweaks the rules a bit.

I don't personally want to use something that could leave me high-and-dry if something goes awry, and I'm too lazy to research aspects that mitigate the risks. So, I don't eBay. I work a state-level IT job. Not a lot of reward, but not a lot of risk either, and I don't have to worry about stability.

Re:Why couldn't you get rich via EBay?

[1iar_parad0x]

If you're bringing in $100,000+ per month in sales, you probably should get your own site. EBay is great for the 'small-time' or 'early-stage' seller. It's a robust engine that can handle heavy traffic and activity and is reasonably secure. However, if you've got sales as high as mentioned in the article, I can't imagine how EBay could provide an adequate solution for you. If you sell big ticket items, you probably want some binding contractual arrangement. On the other hand, if you have an incredibly high volume of sales, you probably want to better cater the shopper's experience and would have an E-commerce site of your own. Not to mention the fact that you'd need some internal system (even an Access database) to track all of your sales and shipping data. Maybe EBay's API allows you to do some of these things. I'd certainly be happy to hear about anyone experiences with it.

Re:Why couldn't you get rich via EBay?

[pthor1231]

It seems to me that some of these people that do have a high volume of sales do have e-commerce sites, but use eBay as really cheap advertisement. Most regular people look to eBay as one of the first sources when they buy stuff. If the actual sale amount is cheap, then the percentage cut eBay takes isn't much, and the listing fees are constant if you do a high enough volume, which amounts to have much reduced cost of hosting, advertising, developing, and you reach a huge audience.

Re:Why couldn't you get rich via EBay?

[billcopc]

A big eBay seller opening their own independent site could be the death of them. eBay is like the super mall, it brings in a whackload of potential customers and everyone's marketing efforts sort-of cooperate in that environment. i.e. if your competitor's ad brings in people to the mall, they will also see your store and maybe you'll get a sale too, for "free". Just as if someone's looking at one eBayer's item list, then glances down at the "related items" table they might come across one of your sales.

The prime difference when it comes to eBay, and the one that makes it horribly dangerous, is that very same easy access to other shops. There is ZERO customer loyalty on eBay, people just check your feedback once they have already found what they want. You could be selling some doodad at the same price as a competitor, but that other fellow may charge a dollar less for shipping and you've just lost the sale. People come to the real mall with a specific store in mind, then walk around the rest to see if there's anything else they want. People come to ebay with a specific product in mind, and they will compare everyone's offerings to get the best deal. It's the Walmart effect, automated and unsupervised.

Re:Why couldn't you get rich via EBay?

[MrNougat]

When the profit margin on the products you're selling is constant and eBay constantly raises the fees, then no, you can't.

If your profit margin was constant while eBay was raising fees, you would have to be raising your selling price (so that the increased fees were not cutting into the profit margin).

In other words, yes, you can. If eBay raises its fees, then you raise your price (or reserve). If you are still unable to compete in the marketplace, then you need to figure out how to spend less capital on something else (because, if you're unable to compete, then someone is succeeding, and you need to do what they're doing).

More generally, when the market changes, businesses must change to keep up. Unless you're the RIAA/MPAA, in which case you can wave your arms around and sue people a lot.

Better question

[Umbral Blot]

A better question than "can you get rich on ebay?" is "is getting rich on ebay worth the time, boredom, and effort?". I think the answer is no, at least for me, as there are more interesting things I would rather be doing (see sig.).

Well

[thealsir]

There are a bunch of spammers selling tons of things in various uncontextually related categories so they get the most bid. They have polluted ebay with noise, and it seems little is being done to stop them. It makes searching for some products (especially specialized ones) such a pain.

"Getting rich on ebay" is akin to "keyword spamming with listings."

There is a group that makes money legitimately. However, that group is not insanely rich.

And the answer is...

[Anonymous Coward]

Because we vastly overestimate the intelligence of people. Some idiot sold a million pixels on his website for a million dollars, but we sit here thinking people expect something that's, well, worth something ...

Instead, all they want is pointless, worthless crap, or space on a giant banner ad site no sane person would ever visit save out of morbid curiousity after seeing an article carried by the AP. And no, I'm not about to link to the wretched thing.

Thus, the formula appears to be:
1. Invent completely something idiotic, yet popular[*]
2. ???
3. Profit

[*] These traits are entirely too compatible. For example, take Adam Sandler or Jim Carrey...

Re:And the answer is...

[mjh]

Instead, all they want is pointless, worthless crap, or space on a giant banner ad site no sane person would ever visit save out of morbid curiousity after seeing an article carried by the AP.

Why do you care? If the thing that I want seems pointless to you, what do you care? I'd bet that you purchase some things that seem pointless to me. But the advantage of me earning my money and you earning your money is that we each get to decide what to do with it, even if it seems pointless to someone else.

Just out of curiosity, how would you propose that purchasing be done? Are you suggesting that we prevent people from purchasing what you think of as pointless crap? How would you implement that? What if that enforcement agency looked at slashdot, saw all of the -1 rated posts and concluded that this was a pointless purchase? Don't you think that you'd feel your freedom was impinged upon? Don't you think that if you enforce purchasing controls, that ALL people who aren't allowed to purchase something they want (even if it's "pointless crap") will also feel that their freedom was impinged upon?

Personally, I don't see any way of solving the pointless crap problem without dramatically curtailing individual freedom. IMHO, I'm happy to live with the problem of folks buying "pointless crap" if it means we get to keep individual freedom.

Why does this sound like Amway?

[Nefarious Wheel]

Why does this sound like Amway?

Tiered sales .... um, hint #1. Invitation only, hint #2. Minimum sell to achieve "privileged" status ...hm.

Can't I just buy the box of soap and go home?

eBay is a flea market

[Bing Tsher E]

As is the case with any flea market, there are going to be people who think like 'businesspeople' and make loads of money from the operation. But for the rest of us it's a good place to exchange cool stuff with each other easily and with less hassle than in many other markets or forums.

The trick is to figure out who the 'hustlers' are so they can be avoided like pariahs. eBay can and is a peer-to-peer environment for many of us. I get cool older/odd/unobtainable tech there and don't regret participating in the least.

Anyway, most of the 'hustle' people are similar to the same sort of people at the flea market. Their 'booths' suck.

Make a Million profit on ebay 2006? No way.

[mrshowtime]

I used to be on ebay as a powerseller in the heydays of 1997-2001 and made a lot of money. Now, I would not touch ebay with a 12 foot clown pole. The only way you can make a profit now is if you have something that is a true collectable or very valuable or very hot. For instance, if you got your hands on 20 PS3's you could stand to make about $20,000 if you sell the day the PS3 is released. There are rich people out there for whom money is no object and you can profit off of them. The downside on ebay today is actually paypal BUYER fraud. Let's say you do manage to get your hands on 20 PS3's and put them up for $1,500 each. You will get buyers who are legitimate and very rich. You will also get a lot of scam artists who will use paypal to try and defraud you. All the buyer has to do is say "not as described" and paypal will hold the money till they investigate fully (read actually do nothing till YOU send them proof--guilty until proven innocent). Catch 22, if you don't accept paypal, then you can't protect yourself from dummy bids (someone using a zero or low fb id, bidding a rediculous amount or just simply "buy it now"-ing all of your auctions. Also, since you don't accept paypal it actually makes you look shady! Plus the public has gotten used to paying for everything immediately and if anything the people on ebay have gotten worse and worse over the years. Make a million on ebay? Sure, no problem. Take home a million profit? No way.

Re:Worth the effort?

[Umbral Blot]

Well if you are already committed to physically selling and buying items as a way to make money then you are certainly right, there is no reason not to use ebay. What I was pointing out is that there is no "free" way to make money. Beyond ebay's transaction fees you must also commit a decent amount of time and energy making it work and moving enough inventory to support yourself. I think that in the eyes of many doing this kind of job is so boring that it isn't worth the money, and that we would rather be doing something else even if it pays less.