Top 10 Mistakes Beginning eBay Sellers Make

How to Avoid These Common eBay Mistakes

Caucasian woman packing boxes
Getty Images/Peter Dressel

Too many new eBay sellers begin with tremendous optimism but end up burned out, frustrated, or financially worse off than when they began. Many of these sellers try to lay the blame at eBay's feet or at buyers' feet when in fact a little common sense and some awareness of common mistakes could have helped them to get off on the right foot.

Here are some of the most common eBay mistakes made by new sellers and the best ways to avoid making them.

1. Not Treating Their eBay Selling Like a Business

New eBay sellers often imagine that eBay is a chance to "start slow and grow." In other words, they secretly mean to avoid thinking of their selling as a business until they are making good money with it. This kind of thinking puts the cart before the horse. In order to make good money on eBay, you will need to think of eBay as a business from the start and behave that way. That means you will have to set yourself up as a money-making enterprise.
Avoid this mistake by carefully selecting a business model and outfitting an office, taking accounting and bookkeeping seriously, working hard on sourcing and market awareness, and avoiding the pitfalls associated with starting a business without taking it seriously enough to succeed.

2. Trying to "Get Rich Quick" with Drop-Shipping

If getting rich were as easy as buying a subscription to a Google-promoted "drop shipper" and then letting the drop shipper and eBay "do the rest" in a business that "runs itself," everyone in the world would be rich.

The truth is that there are so many sellers on eBay trying to use the same handful of drop shippers to sell the same goods in a very crowded marketplace that it can be very difficult to survive this way, much less grow or make a good profit. 

Avoid this mistake by carefully studying drop-shipping options if you're inclined to think along those lines. First, though, be sure this is the right option for your needs. It's important to consciously choose an eBay business model that will work for you.

3. Not Keeping a Clear Picture of eBay Fees Owed

Small sellers, in particular, can struggle with the drudgery of calculating and recording fees that eBay charges, both for listing items and as a cut of items that have already sold. The same goes for PayPal fees, which are charged in addition to eBay fees. Too many sellers start out by putting in lots of hours and earning lots of sales only to feel as though they aren't making much money. They may even find that their net sales amounts aren't covering their actual costs—something that can drive a seller out of business very quickly.

Avoid this mistake by using fee calculators and basic accounting techniques to keep careful tabs on and control your eBay fees, so that you know whether all that selling you're doing is actually contributing to your bottom line or hurting it.

4. Setting Starting Bid or Fixed Prices Too High and/or Setting a Reserve Price

If your item and item listing are in good shape, your item will sell for something approximating market value—unless you kill interest with a high starting bid price, a high fixed price, or a reserve price.

On eBay, reserve-free auction items that start at $1.00 earn more bids and finish at higher prices than identical auctions with "stop loss" starting bids or reserve prices. Too many sellers are so unwilling to trust the market that they set either a bid/sale price that's far too high or a bid-killing reserve price, thus leaving money on the table that they otherwise would have earned. New sellers of used items also tend to overestimate the values of their goods. Too many new sellers of used items include the language "Cost $N.NN when new several years ago, our loss is your gain!" in their listings. Truth is, a used item is worth a fraction of what the new item was worth, no matter how high its original value.

Avoid this mistake by starting auctions at below fair market value (ideally at $1.00), without reserve prices, and trying not to think of eBay selling as a way to recoup the "original value" or local retail value of an item.

5. Skimping on Item Descriptions

Most of what's sold on eBay are standard consumer goods. eBay offers a catalog system that has the specifications and a stock photo for most of these and asks for an item condition (variations on new, refurbished, used, or not working). As a result, many new eBay sellers assume that there's no reason to supply "their own" description when listing an item for sale. Nothing could be farther from the truth! eBay buyers are a picky bunch and want to see your description of the item. Why are you selling it? Even if new, what is the condition of the packaging? Are all the accessories included? Is this a resale after a private purchase, or are you a liquidator? Is it still under warranty? Scratches? Dents? Dings? Items without good descriptions sell for measurably less on eBay auctions than items with good descriptions.

Avoid this mistake by crafting an item description that is unique to you and to the item(s) that you are selling, and that looks and reads like the kind of item description that eBay buyers have come to expect and understand.

6. Skimping on Item Photos

Listings without photos or with only eBay-supplied stock photos also tend to seriously underperform relative to listings with photos that you took of the actual item(s) you're selling. This is particularly true in auction format listings. eBay shoppers tend to want to see (a) that you actually have the item in question, and are not a reseller or drop-shipper without any stock of your own, (b) that you are a conscientious enough seller to be willing to spend a little time marketing your goods yourself, and (c) what the item's condition actually seems to be—when it is seen with their own eyes.

Avoid this mistake by taking multiple good-quality photos of any item(s) that you sell on eBay and including these in each of your eBay listings.

7. Charging Too Much for Shipping

It can be tempting to try to increase shipping costs slightly in order to make an item's sale price appear lower, but this strategy only serves to hurt you in the long run. For one thing, price-conscious consumers that sort their search results by price will see items sorted according to their total cost (including shipping), so "making up the difference" in shipping actually tends to lead to decreased sales.

More importantly, though, eBay shoppers increasingly seek out and are willing to pay more for "free shipping" listings, and eBay's best match system tends to promote listings that offer it to higher search result placement. Perhaps most importantly of all, eBay shoppers these days are notoriously touchy about shipping costs and may quickly ding you with a one, two, or three-star detailed seller rating for shipping costs. A few of these and you can kiss your eBay business goodbye.

Avoid this mistake by selecting a carrier, packaging and weighing your goods, and charging for the actual shipping you'll owe the shipper in order to have the item delivered—or doing what many other sellers are doing and simply offering free shipping, even if the item's price has to be adjusted accordingly.

8. Having Friends and Family Bid on Auctions or Using Another Account to Do So

Many novice sellers mistakenly assume that it's a smart strategy to have friends, family, or even a second account bidding on their auctions in order to raise auction closing prices and "ensure" a fairly priced sale. In fact, all of these kinds of activities are classified as shill bidding, and shill bidding is the kind of offense that gets you banned from eBay for life.

Avoid this mistake by listing items with a high starting price or reserve price if you're really worried about not getting enough for a sale.

9. Being Unresponsive to Customer Complaints and/or Not Allowing Returns

If your goal is to sell as much or more on eBay as you are selling right now, failing to address customer concerns in a prompt, positive, professional manner is a bad idea. eBay's feedback and detailed seller rating systems guarantee that each new shopper that considers buying from you will have some idea about how you have treated past buyers, and you'll find that shoppers will tend to quickly evaluate your feedback to decide whether or not you're the person they want to do business with. More to the point, eBay also watches the number of disputes that have been filed against you and the number of complaints that they've received about you that they end up having to fix with their buyers.

Avoid this mistake by always answering customer email and phone calls in a cheerful, timely manner even if the customer is upset, and offering the opportunity to return items to customers when they are truly dissatisfied with a purchase they have made from you.

10. Not Using All Available Tools to Grow and Prosper

Too many new and eager sellers plod along with the "base" eBay, wasting their time and selling inefficiently and using guesswork, even as their competitors list more items and make more sales in less time and with better final margins and sell-through rates. It is nuts for you to allow this to happen to your business, particularly when so many free and inexpensive tools are available to you.

Avoid this mistake by evaluating and using a combination of Selling Manager, Listing Analytics, Sales Reports, Terapeak or one of its competitors, eBay Stores, Turbo Lister, and other time- and money-saving tools and services.

The Bottom Line

These aren't all the mistakes that new sellers tend to make, but these are many of the most common. All of them are easy to avoid, particularly once you understand the impact that they can have on your business and its viability in the long run.

Continue Reading...