Starting an Ebay Business on a Credit Card
If you have read any of my posts I have casually mentioned that I run a business on eBay. Everyone wants to make extra money, if you do not you are probably not reading this right now, you are probably reading a gossip magazine featuring Kim Kardashian and Kanye West, the spam comments will be flowing in shortly. One of the problems with selling on eBay is most people just don’t know where to start, back in 2006 I was no different, so I want to share with you how I got started and exactly what I did to make some money on eBay. Like any story, you have to start at the beginning, this is no different, so in a land far far away began a story about starting an eBay business…………….
Back in 2006 I was working at the golf course and playing poker. When I was not working at the golf course I was making trips to the casino to solve my inner gambler by going to Potawatomi in Milwaukee. On the way up and sometimes back down I would stop at the outlet malls there. They had a couple stores I liked and the holy grail for me, Nike Outlet. I have an extreme loyalty to Nike, I think 99% of anything I wear outside of work is Nike. Like any college aged student I was always looking for great deals and since I liked wearing Nike it only made sense. I was a gambler and entrepreneur at heart and when I was looking for clothing and shoes for myself I started thinking. How many people have access to a Nike Outlet? Would people buy items that I liked to sell for a profit on eBay? I didn’t do any research instead I thought if there was only 1 Nike Outlet from Chicago to Milwaukee(there is more today, not back in 2004 though), then there can’t be more than a couple in each state at most. I found a need and luckily enough I found a supplier in Nike. I then took the chance and bought some clothing to test out if people would buy the items for more than I bought them for so I could make a profit.
I remember like it was yesterday, I bought every gray Jordan polo they had on the clearance rack. The polo’s were on sale for $10 with a retail tag near $65, I bought all of 5 of them. I figured if this didn’t work out I could return them to receive my money back, the rewards far outweighed the risks. I bought them and being the savvy financial person that I was I put everything on a credit card*. I did this for 3 reasons.
1. It was easier to track, I thought if it’s all on my credit card I can follow the purchases adding up and the money received from eBay would show how much money I made
2. I could get rewards on the credit card, this would increase my profit, score for Broke Steven!
3. I didn’t want to hand out my fresh $20 bills from the golf course, I needed this money for credit card and student loan debt, plus what if it cost more than I had in my wallet, I needed the credit card.
I had never really been on eBay before, I mean I looked around but just to see what was out there, not to sell anything. So I read a few things on eBay and since I was reading Get Rich Slowly, JD’s article on eBay came up. It’s amazing to me sometimes how much Get Rich Slowly has influenced me in financial decisions and improving my overall financial knowledge, thanks JD! I took a few of the tips and applied them to my listing, I’m not even sure if I took any pictures back then because at the time you were able to take pictures from the internet and use them in your listing. I set up the listing as an auction and waited for the bids to come in. Surprisingly they did, bid after bid, by the end someone had bought the Jordan polo for almost the full retail value, they bought it for over $50, I knew right then that this was going to work, I was pumped, I just made over $40, not including eBay fees. So I listed a couple more of the Jordan polo’s on the 7 day auction. The polo’s still made a good profit but not the same as the first one**. The shipping wasn’t terrible difficult I grabbed a box from my local grocery store and sent it on it’s way. Also amazing is how far I have come along since my first sale, so many little tips that I have learned along the way, don’t worry I will be sharing them in a future post or guide!
The good news was I made some money and didn’t have to return a thing to Nike. I was eager to get back to the Nike outlet, which occurred this time without a run to the casino, a surprise in itself. I went back looking for Jordan polo’s again because if they made money this time, they would make money next time, but no luck. I went to where they kept the clearance shoes, the great thing about shopping with the end game of selling the item is that you buy any size because you don’t care if it fits you the point is that it fits them. I remember reading that the most common shoe size was the 10.5 so I went right to that area and looked for great deals. I found some Nike basketball shoes that looked great and had a large discount off the retail price. After I got home I found out they were last year’s Vince Carter shoes who at the time was a big deal because he could jump over buildings in a single bound. I followed the same principles of listing and used the auction format, I sold them for an even high profit than the Jordan polo’s! I made a little over a $50 profit, since these came in a shoe box they were much easier to ship than before. I had bought 2 or 3 pairs and like the Jordan polo’s my first pair went for the most and the other pair still made a nice profit. Things were going great I was getting my first taste of running a business and being an entrepreneur.
I was making money and having fun treasure hunting for deals. I went back and the previous items that I had bought were no longer there, I needed to buy more items and try new things to sell on eBay, so I took out the credit card and bought $200 or $300 worth of items and then went back later in the week and bought $200 or $300 more on the same credit card. Some items were selling and some were not, lots of trial and error, I wasn’t really calculating a price that I needed to sell the items for so I would sell items and make as little as a $1, which for the time and effort I put in, it needed to be more. I was also making more and more trips buying items and returning items before the 30 day return policy*** left me with store credit instead of the money back on my credit card. Since this was the only place I was buying items from I also ran into an inventory problem. It wasn’t that they didn’t have items for me to sell, it was that they didn’t have items I could buy and sell for a profit. Since I was working at the golf course in the Chicago area the season had to come to a close and so did my eBay business on a credit card. I had plans to move after the season and with it my eBay business moved on as well. While my eBay business may have closed up shop, I took away some valuable lessons from my first side business.
- eBay really is not that hard to operate, if you can run your smart phone you can figure out eBay
- Know what you are selling. I am very familiar with Nike and that helped in the beginning, but you need to know what sells and what people want
- Starting a business on a credit card is not the smartest decision. I ran into problems with paying off the card and facing possible interest charges, it was also really hard to keep track of what I was buying and selling and returning.
- Inventory is key. Unless you have something to sell eBay won’t work simple as that
I learned a lot from selling on eBay in the beginning and I will be sharing more about my eBay story and business in upcoming posts. How was your experience starting to sell on eBay? Did you make any money? What was the first item you sold?
*I no longer use credit cards in any way, I think they can work for some people, but they did not work for me, I currently have no interest in seeing if they will, I suggest the same for you.
**This should have alerted me to something about a eBay that took me over 7 years to figure out, any guesses on what?
***Retailers frown upon this, but I have never ran into an issue with returning items.
Featured image courtesy of: creditcardcatalog.com