When times are tough and sales have slowed everywhere, eBay users have every reason to worry. Sellers that rely on eBay sales for a significant portion of their income employ aggressive moves to try to shore up business.
But eBay sellers must also make sure not to take unnecessary risks or fall prey to common bad decisions. Here are eight things to keep in mind when trying to navigate the troubled waters of an economic downturn.
Don’t Panic or Overextend Yourself
Take care to know and control your fees and become a meticulous bookkeeper and selling strategist to stay current with them. Don’t fall into the “fees trap” in which you have to count on this month’s sales to pay last month’s fees.
If that becomes you and sales continue to slow, you’ll find yourself desperately trying to drive sales to cover fees you already owe so that you don’t end up suspended and unable to sell anything at all. That means lowered prices or increased listing quantity (which also lowers prices), ultimately meaning reduced revenue and per-item return on your investment, often without making up any ground on your fees.
Don't Be Naive About Supply and Demand
Remember that you can’t dictate to the market, no matter how strategic you are or what kinds of sourcing deals you can get. Remember, too, that consumer needs and buying behavior often change in down markets.
Understand what you’re selling and how the marketplace approaches it. Before making any sourcing deals, stay abreast of what’s hot in your selling categories, time your listings appropriately and make sure that you don’t lose your head and start to compete against yourself.
Don’t Hurt Yourself With Cut Corners or Unnecessary Risk
Drop shipping relationships and models can seem very tempting at times like these, but competition in this space is now intense for most goods that can be sold this way. Furthermore, low- or no-overhead models are often synonymous with increased risk and poor customer service.
Don’t Underestimate Your Costs
Aside from fees, other costs or expenses (taxes, licensing, shipping, insurance, packaging, and returns) can look like tempting “belt-tightening” areas. However, these areas are the worst places to cut because if anything goes wrong they can do serious damage to your ability to continue to conduct business, not to mention spark liability and penalty issues. Be honest with yourself about such costs and continue to account for them at the same level that you would in an up economy.
Don’t Just Let Unpaid Items Slide
In a down economy, sales go down and deadbeat bidding goes up. Even if you’re tempted to sometimes let fees slide in the busy environment of an upmarket, file disputes in this market to protect yourself. Beyond not having to pay fees that you don’t actually owe, you’ll also be helping to do your part for yourself and all sellers by pushing non-contributing buyers out of the marketplace.
Don't Put Up With Risky Bidders and Buyers
Though it may seem as though every sale counts, the world of problem bidders and buyers is even riskier during economic hard times. Unless you depend on an extremely high volume of very small, low-risk sales, consider relieving yourself of the burden of dealing with high-risk eBay shoppers, thus making both your revenue stream and your overhead in terms of time and cash flow more predictable.
Don't Leave Yourself Open to Unnecessary Returns
Whether this means listing your items on an as-is basis, pushing warranty coverage whenever possible, including stronger disclaimers, or just being as upfront as possible about item conditions, the last thing you want to deal with during tough times is a return.
Don't Take Sourcing Relationships for Granted
Whether your source is eBay wholesale lots or someone else’s wholesale or import/export business, stay one step ahead of your sourcing relationships in a market like this one, since availability, cost and even existence can fluctuate rapidly in down markets.
During an economic downturn, agility, conscientiousness, and attention to detail are central to your success. Being prepared and attentive are the keys to staying one step ahead of the competition, your customers, your suppliers and the market in general.
Risk-taking can be tempting, but be sure that you’re not taking risks along the way that can put you out of business suddenly or open you up to sizable liabilities. Finally, remember to use the tools that eBay offers you to make the most of your trading potential. Stay steady, smart and light on your feet, and your eBay business will be just fine.