by Eric Bailey

Created on: February 10, 2010

Believe it or not, there truly is a downside to selling on Ebay. At first, it seems like an incredibly lucrative opportunity: Sell nearly anything, run your own operation, and stay with whatever pace you want to set. Ebay offers its members control, peer feedback, auction services, and other appealing features.

In fact, many even have their own shops set up on Ebay, and run them as a full-time job or as part-time supplemental income. They may specialize in an area of products, such as movies, video games, clothing, or books; or, they may be a “general store” of sorts, with quirky listing that attract specialist buyers.

But despite the widespread success many have had with the website, inquiring people should be wary of the downside of selling on Ebay. Although it may appear to be a no-lose scenario that offers loads of money in exchange for getting rid of unwanted items, there actually are some drawbacks.

Time Investment

Considering the timing involved with acquiring items, writing descriptions, taking photos, follow-up, navigating the website, keeping track of auctions, and shipping items, even a single sale can take a notable chunk of time. Then, if you have to relist any items, alter listings, transfer money from accounts, navigate PayPal, and maintain solid accounting records, you may realize that selling on Ebay can turn into quite an enterprise.

Inconsistent Profit Margins

Whether the economy is raging or rocky, resale is always a tricky proposition in terms of revenue gains. The cost of shipping alone is one provocative reason why local reselling shops still exist, rather than the industry entirely converting to online storefronts. For someone to purchase a product, even used, then list it, hope it sells, then pay for the shipping can be costly. If the initial auction price is set too high, the customer obviously will not buy; yet if the cost is slashed downward, the slim profit margin may not make Ebay a worthwhile endeavor. The best route seems to be to take advantage of trends in demand, selling “hot” items while they can garner a good return.

Seller Stigma

Despite its years of trade experience and reputability online, Ebay is still definitely viewed by many as a second-rate resource for items. Similar to the “flea market” reputation that many brick-and-mortar locations suffer from, Ebay similarly encounters opposition to such an extent that many otherwise viable customers avoid it.

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