The Real Deal

By Sharman Egan Lagniappe columnist

Now that the holiday gift-buying frenzy is a month or so behind us, I have a question for all you readers out there in Lagniappe Land. Just how much time have you spent on eBay these last few months? I know I did my part to keep the online marketplace going.

Apparently I’m not the only one. According to eBay, there are over 1.3 million registered users in Alabama. If you believe those figures, that’s about 28 percent of the population. Sounds high to me, but who knows?

Of course, most of those folks are buyers, but many are sellers and some of them are selling more than just the extra clutter around the house. The company says over 3,000 sellers in Alabama qualify as PowerSellers, those who sell an average of over $1,000 worth of merchandise or services each month with high feedback rating from buyers.

John Burke, owner of Sell it Fast on eBay (user id: gtinal) and a resident of Fairhope, is one of those PowerSellers. Although he doesn’t sell full-time (he makes his living as a consultant), eBay plays a big role in his life. He buys on eBay, sells his own inventory (mostly coins, antiques and other collectibles) and he’s also an eBay Trading Assistant. That’s someone who sells items on consignment for other people. Burke even teaches eBay classes at ESILL (Eastern Shore Institute for Lifelong Learning, www.esill.net) in Fairhope.

So where does Burke find time to work as a consultant? That’s one of the things he likes best about selling on eBay: its flexibility. When I spoke to Burke, he was putting his eBay business on hiatus and heading off to China for six months on a consulting gig. When he gets home next August, he’ll be back in business almost instantly. “eBay lets me to transition between full-time consulting jobs,” he said. “It’s very flexible.”

What else does Burke like about selling on eBay? “It has the lowest cost of entry of any small business. All you need is a camera, computer, Web address and credit card,” Burke explained. “On eBay your overhead is about 10-12 percent of the value of the goods you’re selling. In a retail location in Fairhope, it’s about 20-25 percent. It’s great for Moms with kids or anyone who wants to create an income from home.”

So just how much can you make? Burke says it fluctuates depending on how much time he spends on his eBay business versus his consulting business. He’s sold as much as $26,000 in merchandise in a single month when selling full time. Cha-ching.

There are seven other eBay Trading Assistants in the Mobile Bay area, including Auctions That Work (www.auctionsthatwork.com). Unlike Burke’s company, it’s a full-time operation with a retail location on Cottage Hill Road in Mobile. The storefront, known as a “drop-off store” in eBay parlance, makes it convenient for sellers to drop off items to be sold.

The company was founded in 2005, and the storefront opened in early 2006. Sharon Feaster, one of the partners in the company, was an experienced eBayer before making it her full-time occupation. “Before starting the business, I was a stay-at-home Mom. My partner was too,” Feaster said. “We both had a lot of eBay experience and computer skills. I had been buying and selling on eBay for about five years.”

Feaster explains that unlike most sellers who specialize in a certain type of product, her company is a full-service operation that sells products in all categories. “We sell everything from vehicles to boats and collectibles. And we also freight and crate,” Feaster said. In addition to selling household items for individuals, she handles business and estate liquidations, IT asset recovery, government surplus and fundraising for charities.

So let’s say you have some items you want to sell – maybe that coin collection you inherited from your grandfather. Why sell it on eBay, instead of using a more traditional method?

“It opens up your customer base to the world,” Feaster said. “So an item can sell for a considerable amount more. But it can also decrease your value. eBay value is totally different from all other values.”

Why use a Trading Assistant when you could just sell it yourself? Sell it Fast on eBay and Auctions That Work charge a commission of 20-35 percent on top of the fees charged by eBay.

“Many of our sellers don’t have the time or expertise to sell their items themselves,” said Feaster. “And some of them don’t want to put their information online.”

Burke said his customers make more money selling through him. “When I sell collections for my customers, they make 10-50 percent more than they expected to make using other methods, even after my fees,” he said. The key, according to Burke and Feaster, is understanding the strategies of selling on eBay – how to describe and price the item, when to end the auction, etc.

Burke, like Feaster, cautioned that selling on eBay doesn’t necessarily generate top dollar. And even with the lower overhead of selling on eBay, sellers don’t necessarily get a higher margin since buyers expect to get a deal. “It’s Wal-Mart compared to Saks Fifth Avenue,” Burke said.

Even so, both Burke and Feaster are happy with the revenues generated by their businesses. “We’ve done really well with it,” Feaster said. “We have a large customer base and lots of repeat customers.” And Burke adds, “it’s fun.”

Sharman Egan is Lagniappe lagniappe columnist. Contact her at Sharman@SharmanEgan.com.

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