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23 February 2006 — My eBay Method (7)

My first batch of eBay sales is finished; the buyers are receiving their items, and feedback is being exchanged. Of the 24 items I posted, 22 sold. Bids totaled $1145.92, from which I earned $915.65 profit. (My expenses were: $32.80 listing fees, $44.30 closing fees, $39.12 PayPal fees, and $114.05 shipping fees.)

In my auctions, I'm doing two things that conventional wisdom frowns upon — using ten-day listings and providing free shipping — yet I feel that both of these are helping me get better prices. I know that when I buy things off eBay, I always bid more for free shipping. It's just nice not to have to hassle with a shipping price. And though many people say ten-day auctions don't produce higher sales prices, I'm not convinced. Especially on my more desirable items, the bidding rose a fraction every day. Might all the bidding have been compressed into seven days if I'd elected to host shorter auctions? Perhaps. But I'm comfortable paying forty cents for three days extra.

In true J.D.-fashion, I kept a detailed spreadsheet on each listing (condensed version). Before posting each auction, I determined a minimum desired sale price and a maximum expected sales price. Two items (both old Apple II computer games) did not sell. Two others — my precious Little Nemo book from 1972, and a Superman book from 1978 — sold for less than what I'd hoped. Everything else met my minimum desired sales price, and nine of the items sold for more than I expected. Two of the items sold for way more than I'd expected.

Cosmic Encounter, a board game I bought in the early nineties, sold for $232.50 — I had only expected it to reach $150. The biggest surprise, though, was a set of Bible commentaries. I'd spied this set of books in the Sellwood Stars antique mall soon after we moved to the new house. They were listed for $8, and I wanted to buy them, but Kris pooh-poohed the notion. I went back the next day and bought them anyhow. I liked that they were the same size as my Modern Library books. During last fall's great book purge (for which this eBay stuff is one of the last steps), I decided I didn't have room for the Bible commentaries. On a whim, I checked eBay and was shocked to see that complete sets sold for $150. My set wasn't complete, but I figured it would go for $125 or so. It sold for $222.50.

Other items that sold for more than I had expected include my Star Wars VHS tapes (widescreen, THX, super-deluxe edition, the last prints before Lucas started tinkering with the original films) which sold for $51, and a Tintin popup book which sold for $43.

I have a second batch of auctions up at the moment. Aside from a couple of items, they're not doing as well as I'd hoped. I had to take one item down because it wasn't what I thought it was. Two of the nine remaining items don't have bids yet (though Sunday is still several days away, and these items do have people watching). Still, bidding has reached $110 for these items, which isn't far from my $150 minimum desired total. (My maximum expected is $265.)

I am now giving serious consideration to auctioning some larger ticket items, things such as:

  • my film-based SLR camera — this would leave me committed to digital;
  • lenses better suited for film work than digital work (such as my 20mm wide-angle lens, which has an effective focal length of 30mm in digital);
  • my 700mhz iBook.
One problem I keep encountering is that I'm not expert enough about my various items to know how to describe them correctly. By this I mean, many of the items I have for sale are collectables, or items where the condition is important. I often don't have a basis for using the right words (e.g. "mint", "near-mint", "very good") to describe condition. Instead, I perform a sort of visual assessment and then try to convey this information via words. Turns out, I may be overstating the blemishes. One buyer wrote me in private e-mail: "The [books] arrived today, and my wife is very pleased, indeed. They are in much better condition than we even hoped..." I guess it's better to under-promise and over-deliver than to do the opposite.

Finally, here is my eBay auction routine, which is based on much reading, and asking many questions in various forums:

  • I start my listings on Thursday afternoons and evenings. I run ten-day listings. My goal is for them to end on Sunday evening between seven and ten Eastern (four and seven Pacific). This gives me two weekends to attract bids.
  • If I need to, I pay the extra ten cents to prepare listings in advance and schedule them to start on Thursday evenings. This week, I don't have any ready to go, so I'll rush home after work and spend about three or four hours madly posting items in real-time.
  • I offer free shipping, insurance, and delivery confirmation. (I'm considering nixing the insurance.) Sure, I could charge for these, but all of this money is gravy anyway, and I haven't yet been burned by the free shipping, so I'm willing to keep doing this. I think it builds goodwill.
  • I offer a money-back guarantee, but only if the item is not as described. (Not if a person changes his mind or made a mistake.)
  • I post low starting bids. The more popular I think an item will be, the lower the starting bid. In the case of the Cosmic Encounter game, for example, I knew there would be plenty of interest, so I started bidding at 99 cents. If there probably will only be a couple bids, I start bidding near my minimum desired sale point. For example, I wanted to sell eight books at a minimum of $20 each, so I started bidding for them at $9.99 a piece.
  • Which brings up something else: I research the hell out of each item I'm posting. I dig through eBay to find what similar items fetch. I also look to see how many bids they get. I check other places (Amazon, abebooks.com, other forums) to see what other places sell the item for.
  • I craft my title with great care. For example, I'm currently selling a book entitled The Hidden Game of Baseball by John Thorn and Pete Palmer. I could put all that into my auction title, but it would be a waste. Instead my title is geared toward keywords that I think interested parties would use: HIDDEN GAME OF BASEBALL Thorn Palmer SABR Bill James. The last three terms have nothing directly to do with the book, but people interested in SABR or in the work of Bill James will be interested in this book. I want them to see it in their search results.
  • I try to have a good description, listing the strengths and flaws of my offerings minutely. I generally say things like "I think this book is in great shape, but be aware that the cover has a small tear and the previous owner's name is on the flyleaf", etc. I also try to place additional keywords in the description, but sprinkled into conversational sentences. For example, in my auction for some Tolkien animated films on VHS, I'm using the names of Peter Jackson, Liv Tyler, etc.
  • I refuse to accept bids from headaches: people with negative feedback, people who haven't been paying, and people outside the U.S.
  • I take photos and post them in the description. I use the 35-cent gallery feature so that my photo appears when people browse listings. If condition is a concern, I use many photos to convey the state of the item.
These techniques seem to be working well so far. I'm excited to go rummage around to find more stuff to sell. I have a stack of Flash Gordon comic strip compilations, old Apple II computer games (I've decided to sell these as a lot instead of individually), science fiction novels, and camera equipment that I'm hoping to post soon. I'd really like to find a couple additional big-ticket items like the game and the Bible commentaries. Maybe I should root through my Star Trek collection. I probably have some good stuff there...

On this day at foldedspace.org

2007Smart Kids   In which I meditate on what it was like to be a smart kid, and how that has affected who I am today. (It's not entirely good.)


Comments
On 23 February 2006 (10:08 AM), J.D. said:

I should point out a couple of things.

First, this entire eBay sales-binge is a direct result of my recent auction-house profiteering on World of Warcraft. I was shocked to see how much (virtual) money could be made by buying low and selling high. It made me wonder what I could sell on eBay. These initial sales are primarily meant as a means for me to learn the system while purging stuff I no longer need or want. In time, I hope to begin buying things in which I have some knowledge (read: comic book compilations) for cheap and selling them at a profit. They key is finding the items that will reliably sell for more than I can pay for them. For example, there's at least one compilation on sale in comic book stores (Iron Man Masterworks v1) that is sold out in many parts of the country. It sells for $40 in comics shops, but fetches $80 on eBay. This is a prime candidate for profiteering. Am I evil for wanting to do this, or am I providing a service? I don't know. I don't care.

I forgot what my second point was.


On 23 February 2006 (10:59 AM), Lee said:

It sells for $40 in comics shops, but fetches $80 on eBay. This is a prime candidate for profiteering. Am I evil for wanting to do this, or am I providing a service?

Sounds like pure free-market capitalism to me, hehe.

That said, I'd always assumed profiteering was related to excessive profits for necessary goods, such as food, water, or fuel.

Glad to hear you got such a positive response for your effort. Now, are you going to pay income tax on that $915.65? :)


On 23 February 2006 (11:17 AM), J.D. said:

Hm. That's an interesting question. Are people expected to pay income tax on eBay sales? On craiglist sales? On classified ad sales?

On what portion of the income? Sure, I made a profit on some of the items, but mostly I lost money over what I paid for these items. Can I write this off as a loss?

What are the tax implications of eBay sales?


On 23 February 2006 (11:25 AM), dowingba said:

I would consider buying the iBook, as I've had a hankering for trying out the Mac for a while now, depending on how much you're expecting to get for it. Unfortunately I am one of those headache cases for you...


On 23 February 2006 (11:52 AM), Lee said:

J.D., I was being a bit tongue in cheek, but I believe there is a point at which this kind of stuff is seen as income. (Heck, I had to pay income tax as on a scholarship I received in college.)

The amount a person earns from selling stuff on eBay (or craigslist or garage sales) might become capital gains at some point (but I don't know the magic dollar number or whether it is capital gains or some other term). My guess is that there is a formula for this kind of stuff--more than X dollars of extra income within Y span of time=taxable income.

Can it be considered a loss? Probably, if you chose to itemize it, but you'd probably have to prove that you had bought these things as an investment in the first place.

But, IANAA nor have I actually ever had to deal with capital gains/loss, etc. So take everything I say with a gigantic dose of salt. Here's a link to the IRS FAQ page discussing "other types of income". I didn't see anything relating to your situation. (And I see now that the IRS no longer taxes college scholarships. Definitely a positive change.)


On 24 February 2006 (09:36 AM), JENEFER said:

TOO BAD I DIDN'T READ THIS YESTERDAY, BUT WAS OUT DOING TAX RETURNS. JD DOES THIS SO SELDOM, THAT IT COULD ONLY BE CONSIDERED A HOBBY. NO NEED TO REPORT THE INCOME. THESE ARE PERSONAL ASSETS, NOT BUSINESS. IF HE DID IT ALL THE TIME LIKE A SMALL SIDE BUSINESS, WITH A PROFIT MOTIVE, THEN HE WOULD NEED TO REPORT. IT IS KIND OF LIKE SELLING YOUR PERSONAL AUTO. NO NEED TO REPORT THE INCOME IF YOU MADE ANY AND YOU CANNOT DEDUCT THE LOSS IF THERE WAS ONE. YOU ARE RIGHT ABOUT THE CAPITAL GAINS. IF YOU HAD BOUGHT A CAPITAL ASSET AS AN INVESTMENT AND SOLD IT, THE GAIN WOULD BE REPORTABLE AND THE LOSS CLAIMED AGAINST OTHER INCOME.


On 25 June 2006 (10:17 PM), debbie said:

Enjoyed your breakdown of selling on ebay. have bought but never sold anything. Am interested in giving it a try. Hope i am as successful as you seem to be! Do you know anything about the doba drop ship program?