The Wholesale Forums

[Anon12345]

Hey guys,


I figure I would write this article because it just needs to be said.
A lot of individuals (myself included) started out in the wholesaling business due to the items we have seen sold on ebay. From consumer electronics to clothes, it seemed quite easy to make money from one's computer. Ebay. Not just an auction site but a way to augment one's income from a job, or even pursue one's own "Ebay Business". Floods of people come on to this forum (and others like it) looking for goods that are priced "just right" and in small enough quantities that one doesnt have to find a special place to store it.

I'm here to throw out a suggestion to those of us in the e-retail business, and other people out there doing commerce online. One must realize than focusing only on selling via Ebay's site is parochial at best, and masochistic at worst. Yes, ebay provides a source of income that involves very little work. Yes, ebay provides one access to millions of users. Yes, ebay is quite an impressive hub of online "business".
However, one must look at some of the benefits of pursuing outside mediums for distributing goods. If you look at the parameters of one's "ebay business", one can see how ebay is making cash. They have fees from here to the sky. And forget about customer service. I'd defy one to find a phone number that can EASILY be seen by the average ebayer. There customer service is non-existent and at times, their conduct is questionable.


By searching for another means of distributing product, one can find an avenue where one calls the shots. One is not restricted by ebay's fee structure or listing structure, and one can present one's product in a creative matter.

Another thing that annoys many sellers is the plethora of "businessmen" who search for a supplier and then throw out ridiculous (yes, ridiculous) requests for pricing breaks. Many come to sites like this believing (even requiring) that other wholesalers tailor pricing to their liking. Some of the requests are quite naive (even laughable)....


"Can you get me 10 nanos for 140 dollars a piece?"

"Your Psps cost 198 dollars a unit? What a rip off! Some dude from asia is selling them for only 100 dollars a unit!"

" I know that is says here your terms are non-negotiable. Do you think you can make an exception for me/my wife/my family/my neigborhood??"


LOL. Yea, I'm sure a lot of the sellers have to deal with some of this on a daily basis. If everyone would get out there and learn more about REALISTIC pricing, payment methods, and procedures of REAL wholesalers, the business would be alot easier for everyone involved. Less BS, more money making and a hell of a lot less frustration.


I strongly suggest that many budding wholesalers/ebayers open their eyes and realize that they are severely limiting themselves in terms of revenue and profit. Laziness (yes, laziness) is often one of the biggest reasons why ebay is so profitable. When ebay brings many people to one's door on a daily basis, why not keep using them? Ebay is great for traffic generation, but in terms of revenue generation it can be sorely lacking at times. If you are thinking of ever moving serious cash via ebay, you've got to take a look at that fee structure. You are paying an arm and a leg if you are moving anything over 1k per month. And paypal........


I'm sure many people can attest to this one. Paypal is one of the more fradulent companies out there. Unfortunately, people treat it like its the "end all/be all" of payment methods. The problem is that the company doesnt get enough negative publicity.

"Ill only pay with paypal"

"If he doesnt take paypal, hes a scammer"


"If they arent paypal verified, they can't be trusted"

Trust me on this one. Paypal will just as soon take your money (or allow some other crook to take it) as they would transfer it. Anytime you deal with anything over a few hundred dollars and it goes through paypal, you are asking for trouble. They are INFAMOUS for freezing your account under the guise of "suspecting fradulent activity". And do you know what they do with your money for the six months (yes, half a year)? They put it in a high interest money marketing account!!!! And maybe (its not even guaranteed!) you will get your money back after the six month period.
Can you say BRV Suppliers?

I'm sure there are a dozen people on this forum who can attest to that, and you can find thousands more at paypalsucks.org.

Imagine that. Paypal, a fradulent company??? Believe it. And it only has the potential to get worse now that its the only payment method being accepted on ebay. Just a warning to all of you die hard paypalers out there. And do you know how paypal can get away with attrocities like this? Simple. THEY ARENT FDIC INSURED!!!! In plain english, that means that under NO circumstances should they be held on the same levels as banks (although many people dont even realize this important fact). They arent regulated by anyone, and dont have to follow the same standards that banks do. What does this mean? Simple. Everytime you use paypal, you are playing russian roulette. You may not get burned on lower fund transfers (like forty dollars), but there is a good chance that you can get screwed if you are dealing with anything over a few hundred dollars. And any place where my money isnt guaranteed to get from point A to point B isnt something I wanna deal with.


So do yourself a favor an find an additional source in addition to ebay to sell your goods. You'll have more control, keep more of your own money and be more of a real businessowner.


Just some thoughts from another wholesaler...




Thanks,


Anon

[BaiLong11]

Ok Anon...

I agree with you in many points. I agree that if you deal only/primarily through eBay that you are severely limiting the scope of your business. I also agree that Paypal is at times shady. Also, annoying would-be customers asking for special cost cuts can get on your nerves after some time, but...

This is life. Sorry, but we in the business that we are in, we do not always swim in a pool of rose petals.

eBay is not the end all. But it is a good start for many people. Yes, the fees hurt your profit, but operating a website you will incur costs advertising and the like. Plus, if the eBay fees hurt your profit so much, maybe as you said, people are simply not creative enough. It is far too easy to jump on the newest bandwagon (i.e. iPod, PSP, etc) and not research and try out other electronics with better margins yet not as much competition.

Paypal, has screwed over people, but I have not yet been screwed by them. So I will not slander their name so readily. I hope that I will not have to eat my words in the future, but my experiences have been rather nice with them. Yes, I have had my account frozen by them. They called and informed me of this. I then talked to the nice lady for about half an hour. We were both very courteous, no name-calling, yelling or stupid demands. She then unfroze my account as soon as soon as wegot off the phone. I have also had funds reversed once or twice, no prob.

Perhaps Anon, you have had bad experiences with Paypal, but I find that if you are courteous and professional, that they will work with you ( I am in no way implying that you are anything but that). I have heard of these rumors of Paypal taking money out of accounts for 6 months to reinvest elsewhere, but I have never seen any viable proof of this. And I have also seen the paypal hate websites. Quite humorous, but not a whole lot of facts. Some, but not tons.

I, like many other people on this forum, say get your own website. It may not be your first step as a seller (or wholesaler), but it should be in the process. Slowly wean yourself off eBay and Paypal and set-up your own website/store with a merchant account. This is a great way to go. I have started on mine now. I will not list the website name, as I will not give shameless advertising on this forum without being a registered seller.

So, that is my opinion on the whole eBay-Paypal scheme. Perhaps fraudulant at times, perhaps not. But where would we all be without it? Now that is a question to ask yourself.

I myself, I rather like eBay.

[Unique]

ebay/paypal fees are a pain but not overly bad. biggest problem i see is people selling fakes and those who keep under cutting prices. ebay has poor customer service but if i think about it from there place i can understand why. im surprised a cheaper e-auction place hasnt really took off in this country...

[richard2982]

BaiLong11,
I personally have the experience of being cheated by paypal. Even now, some of my funds are frozen. What happened is, they froze 2 of my transactions saying the owner did a chargeback. Me and my client were so annoying and my client even sent me cash for the transactions to proof that he did not do the chargeback. After 3 months, paypal contacted me saying the transactions were ruled in my way. Just before I can even do a refund to my client, they freeze the transactions again. Saying the owner did a further chargeback (Can one really do 2 chargebacks on a single transaction? I don't know that until now) and until now, it has been 8 months since the 2nd chargeback and I haven't heard from them yet.

[BaiLong11]

Richard,
I am very sorry to hear about your problems with Paypal. I was not completly defending them in my above post, nor was I out to defame them. From my personal experience they have been good to me so far.
I hope that you can resolve things with paypal. You say that it has been 8 months since you have heard from them. Have you tried to call them every couple of weeks and check up on things. I know that if I hadn't taken my call with Paypal in my circumstances that my funds would have been frozen for a long time. I have to say, I do not like the way that Paypal handles chargebacks. I have just been fortunate to never be on the bad receiving end of a chargeback as you find yourself in that place.
Once again, I am sorry to hear about your problems and hope that you can work things out. I did not write my post in order to completely defend Paypal. I worte it just to say my experience and how I saw things... just my opinion.

[BillyA]

As I have said before on this forum, Ebay should be the place for business owners to advertise their own site. Draw Ebay's traffic to your own site - it works pretty well!!

If you only are selling your junk around the house, then use Ebay - its all profit anyway!!

However, if you are buying goods to resell, then Ebay takes a considerable percentage. Combine in Paypal and you are looking at about 8-9% of profits. If your gross margin is 20%, then 8% is a lot.

[icomguy]

No question that ebay should not be the only means of income. BUT you can make money on ebay. Obvously this is the case or there wouldn't be so many people selling there. ebay should be used (at least) as an inexpensive marketing channel for our ecommerce site or other forum of business. It is true that their fees are somewhat high, but if you add up the costs of doing business in other ways that bring such an audience, its not so bad. B&M is very expensive (not counting advertising.) eCommerce is expensvie if you advertise enough to get the same volume of buyers. Paybacks come when you can get enough traffic to your site without as much advertising, althoughsome would argue you never get to this point - the more you advertise the more you make.

Note: Of course one trick to making money on ebay is climbing up the distribution chain. The cheaper you can get your product, the more you make. It really is that simple (not simple to climb up the chain though.) People who complain they can't make money on ebay are not getting their product high enough in the chain.

RE:PayPal, I have to say that i have also not had any bad experiences with PayPal. I would certainly not defend them because I have heard some horror stories, but I also believe you might have similar experiences with other merchant accounts. Chargeback are inevitable in any industry that accepts credit cards - luckily I have not been burned by one yet though.

As always, good luck!
-Paul

[business007]

I have a very big doubt, how exactly are sellers on eBay selling a lot cheaper than I can get an item for? And what are other sources we can use to actually sell our items?

[MustHaveMobiles]

Do a search for Ebay on the forum and all the above mentioned points have been repeated mentioned time and time again.

From day one multiple income streams has to be the way, PERIOD. Lose your ebay account and you are sunk, drop from Google and you are sunk ect ect ect.

but in terms of revenue generation it can be sorely lacking at times.

To this I would suggest that the wrong product is being sold, or being sourced at the wrong price..mainstream is not the way for Ebay.

However, if you are buying goods to resell, then Ebay takes a considerable percentage. Combine in Paypal and you are looking at about 8-9% of profits. If your gross margin is 20%, then 8% is a lot.

20% margin is a little low if you are aiming to make Ebay a sustainable income IMO...again it comes to product choice.

They are INFAMOUS for freezing your account under the guise of "suspecting fradulent activity".

Again approach them first, explain what your intentions are...provide the information they require and then you will have no problems. I used to have some large quantities going through my Paypal account from mobile sales on Ebay and I never had one suspension because I approached them and cleared the process first.

Unfortunately scammers are rife on Paypal but a few simple precautions can go a long way, verified address...signature delivery ect ect

biggest problem i see is people selling fakes and those who keep under cutting prices.

Fakes = report them, doesn't always end up with a result but usually it will.

Pricing...there will always be someone that can do this, on Ebay even a £1 difference makes the difference. Ebay set this standard when they introduced the BIN functionality, leaving it purely as an auction format would prevent these issues...hey ho tho thats water under the bridge now.

Many come to sites like this believing (even requiring) that other wholesalers tailor pricing to their liking. Some of the requests are quite naive (even laughable)

Usually because they are not businessmen/women just someone trying to make a quick buck..

[business007]

I know points have been made, however some people are actually good sellers that sell really cheap and that I can't compete with. For example the PSP's. They sell way below $198 and thats the price I can get it from someone here.