Tuesday, August 10, 2010

Selling Cell Phones on eBay - A Good or Bad Idea?

I received this email today from a reader:

I am interested in selling cell phones on eBay and wondered if you could give me some tips on getting started. Where do I get them for cheap enough to resell and what kind should I sell?

My question back was, "Why do you want to sell cell phones?"

The reader's answer, "Someone said they are a good seller and they sell for a lot of money so that seems like a good thing to sell."

I receive this question quite frequently about cell phones. Here are some things to consider.

1. Do a completed listing search on eBay and you will see over 422,000+ results for cell phone - in the cell phone category, not including accessories. Here is a screen shot:

Terapeak also identified 10,280 sellers offering "cell phones." Why would you want to sell something with that much competition?

2. Do a search for "cell phone" on Terapeak in the cell phone & pda category, excluding accessories. The sell through rate is only 35.65%. Here is the screen shot from Terapeak:

Why would you take a risk of selling a product with only a 35% chance of selling it?

And my point is...


(And don't listen to what other people say, do the research yourself!)

Most new sellers gravitate towards the hot products they see on TV, technical gadgets, or expensive items. Final selling price is NOT the same as profit. Just because an item sells for $600 does not mean the seller is making a huge profit, you have no idea what he paid to acquire the item. He may only be making $10 profit per sale.

There is much money to be made in less glamorous categories. Remember, the definition of a niche is a product for which there is a demand by a small segment of the market and little or no competition.

For example, martial arts uniforms have a sell through rate of 57.68%, 293 listings in the last 30 days, and only 100 sellers offering them:

So what if martial arts uniforms aren't a fun gadget - people need them and will pay for them. They are easy and cheap to ship (not fragile or breakable) and they never expire. The next step in the process would be to find a source for this product, such as a wholesaler or ordering direct from a manufacturer.

Use the Terapeak niche finder to uncover items like this. It is much easier to sell a product when you don't have much competition.

Click here for a list of 395 eBay friendly wholesalers along with 5 important facts for choosing profitable wholesale products to sell on eBay.

Ten Little-Known Highly Profitable Niche Markets on eBay

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