Entrepreneurship: I tried to make money selling on eBay

I tried selling goods on eBay several years ago. I thought; how hard could it be. I worked with a young college kid who was making a mint on eBay selling surplus goods from departments stores. He eventually graduated to selling cheap shoes and clothes from China. I did not have much of an interest in selling clothes or shoes and thought I should stay with my field of expertise – electronics. At the time the Android phones were getting popular and the phones at the time did not have a lot of internal storage. However, you could use and external micro-SD card to expand the amount of available memory. The popular size at the time was 8gB. I spent several weeks looking for suppliers in China using AliExpress. It was tough and required a few late nights taking to manufacturers via Skype in the wee hours of the morning due to the time difference between the east coast of the United States and China.

I started out with a hundred units. I paid via PayPal and received the goods via air freight. I bought padded shipping envelopes and figured I would mark up 30% after costs which included shipping material, postage, PayPal and eBay fees. It started out great at first and I was able to move 20% of my inventory for profit within the first two weeks. However, as time went by it became harder and harder to move the cards. It turns out that other sellers on eBay were under cutting me in price by as much as 20%. I was like how can they do that and contacted the manufacturer I bought from.

It seems that my competitors were buying their micro-SD cards by the pallet; which means their cost was as low as 50% of mine. A pallet contained about 10,000 cards while I was buying 100. It got to the point where everybody and their mother was selling micro-SD cards from pallet and 1/2 pallet purchases. The amateur sellers like myself were no match for the professional sellers. I had no choice but to match their prices; which mean I am selling at a loss. It was lesson learnt. If you don’t go big on eBay then go home.

The site is dominated by professional sellers who are buying goods by the pallets. The only way for the amateur sellers to make money is by selling of knick knacks from your home that you are trying to get rid off. I do not mind stepping up to professional seller. However, I do not have an interest in retailing and if you don’t have a passion for something you are not going to put in the 100% effort needed to make it successful.