The eBay Seller's News, May 2006, Volume 6, No. 5
The Newsletter for Professional eBay Sellers
by: Skip McGrath

The only place where success comes before work is in
the dictionary. ---Vidal Sassoon

Musings ////

Welcome to the over 400 new subscribers who joined us this month. I need a favor. Would all of you --both old and new subscribers please take a moment to go open the email you received with this announcement and click on the link that says Confirm Your Subscription? What that will do is append your name to our emails. This will allow them to get past your Spam filters and will insure you get every issue of The eBay Seller's News.

Our newsletters get indexed pretty well by Google and Yahoo, so if you arrived here that way, I invite you to subscribe. The eBay Seller's News is the largest and oldest newsletter for professional eBay sellers. We have recently gone over 37,000 subscribers and this is our sixth year of publishing.

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Karen and I are busy getting ready for eBay Live. If you plan to go I suggest you register now at eBay.com. Registering early will save you money and save you time in line at the convention. Pre-registered attendees can just pick up their badges and get in, while others have to stand in lines. The lines moved very quickly at the event last year in San Jose, but this promises to be the biggest eBay Live! yet. The event will be held at the Mandalay Bay Hotel from June 13 -15th. eBay Live! is always a great event from the Meet & Greet the night before to the Gala on the last evening. I will be talking on a couple of panels during the show--so just look for my name in the schedule.

Karen and I will be in booth # 933. I hope all of you will take the time to stop by and say hello.

For those of you who are into affiliate marketing, I recently subscribed to a new magazine called Revenue Magazine. The subscription is inexpensive and the magazine is excellent. It comes out six times a year. Revenue is a real magazine mailed to your house, but once you subscribe you can also read it online. Best of all, they have a great online forum for subscribers where you can get advice and find great affiliate programs.
You can subscribe at www.revenuetoday.com and get a free $50 credit toward advertising on Findology which is a competitor of Google, Yahoo and Miva where you can buy clicks on keywords for as little as 3-cents a click.

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I am doing two teleseminars this month. On Wednesday, May 10th I am a guest on Mpire's Business Training series. If you are into eBay consignment selling (trading assistant) you might want to tune in. I will be talking about ways to market and make money with your eBay consignment business. You don't have to be an Mpire client to listen in. Here is the info you need to join us on the call:

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Later this month I will be doing a joint teleseminar with Maikel Bailey who is the head coach at BrightBuilders, the company that runs my eBay and internet coaching program. Many of you have expressed an interest in coaching. Here is a chance learn more about these programs and ask some questions. If you would like to read about the program first, you can find some information at www.skipmcgrath.com/coaching.

I spent a day with Maikel and the coaches earlier this month doing training and reviewing the program goals for 2006. We are updating our programs with new information and techniques that reflect the reality of the higher competitive environment on eBay today. I hope you will join us. Here is the call in info:

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Wholesale Alert

I keep getting emails from people asking me about Salehoo (www.salehoo.com) and other drop ship and wholesale list sites.

These sites claim to have sources for iPods, Prada handbags, Gucci Sunglasses and hundreds of other designer goods, best-selling electronics and more. Salehoo charges $49.95 to access their directory.

Once you pay to join Salehoo, you can access hundreds of suppliers --many of whom agree to drop ship. I spent some time on the site and did find several good suppliers in some of the categories, but I didn't find any legitimate sources for truly designer merchandise or brand-name consumer electronics at prices that could sell on ebay. If you sell in the fashion or apparel category or jewelry, this site might be worth the investment, but like most of the other wholesale membership web sites, you are not going to get real wholesale prices on Gucci, Prada, Fendi, Tiffany and so on. Any the prices for computers, digital cameras, DVD players and so on are better than you find at most retail sites, but not cheap enough to sell on eBay and make a profit.

There are several companies offering this type of paid membership. Salehoo seems to be pretty straightforward. But you shold be especially careful of any company that wants you to fill out a form that captures your phone number or wants you to set up an appointment to call under the guise of "qualifying" you. Once you are on the phone they will pressure you into a program that can cost anywhere from $1,000 to $5,000. Once you pay this you get access to a web site with thousands of products that sell for more than you can already buy them for on eBay and other internet sites.

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1. Selling Famous Designer Goods on eBay
2. The Future of eBay and What It Means for You and for Me
3. Bidz.com Surpasses eBay as The Largest Seller of Jewelry and Watches on The Web
4. Try HammerTap Research for one month for a buck.
5. eBay Express Launched and eBay Stores Revamps Their Resource Center
6. eBay Niche of The Month --Old Advertisements
7. New Wholesale Sources for May 2006

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Let's get started

1. Selling Famous Designer Goods on eBay

As many of you know I have recommended Luxury Brands, LLC for several years as a great source of famous designer handbags, shoes and clothing. Unfortunately, they seem to have fallen apart and I am in the process of removing them from all of my wholesale listings. This is a big disappointment. My wife is down to just a few Fendi handbags left from our last order and was about to order more.

I am not sure what is going on with them except that some of the original founders left. I have heard all sorts of rumors from: they are bankrupt, that they owe millions of dollars to people, that they were trafficking in counterfeit goods and so on --but I cannot confirm any of them. All I know is that several of my customers have placed orders that weren't filled and they seem to have stopped answering emails. As I said I don't know if the rumors are true but I would suggest readers suspend doing business with them until they sort things out. I am hopeful they can fix their problems because this was always one of my best sources of legitimate designer goods merchandise.

If you really want to sell famous name designer goods, flights to Europe are pretty cheap these days. You may not know it, but many famous designers have outlet stores in Europe just as we do here in the states. I don't know where all of them are, but I know that Prada, Gucci and Fendi all have outlet stores located just outside of Florence --between Florence and Rome. I am sure any major hotel concierge can give you directions. I know for a fact that this is where Luxury Brands got a lot of their merchandise.

If you do buy a large amount of designer goods in Europe (over $1000), be sure to send them back using the services of a custom's broker. A&A Customs Brokers at www.aacb.com is used to working with eBay sellers and can walk you through the process and insure everything has the correct paperwork to sail through customs.

Another excellent source if you are in Europe are the Vintage clothing shops and Thrift shops in the high-end neighborhoods of major cities such as London, Paris, Rome and Munich. A friend of mine found dozens of expensive Hermes scarves for as little as $40 that were in perfect condition still with the box that sold on eBay for over $100 each.

If you live in or near a big city you can also find famous designer goods at thrift shops here in the US. The key is to find the shops in the parts of the city where wealthy people live. A lady in our town regularly visits a store in the Magnolia area of Seattle and others in Bellevue and Kirkland where she finds new and almost new goods at incredible prices. Her last find was a pair of Burberry slacks priced at $4.00 still with the $198 price tag on them --and they had never been worn. They went for $127 on eBay. She sells over $3,000 a month on eBay part time strictly from what she buys at thrift shops --most of the goods realize markups of 300% or more.

Be careful of web sites and offers such as Zibus, Salehoo and others that claim to supply you with famous name designer goods --as most of them sell fakes or may be total scams.

2. The Future of eBay and What It Means for You and for Me

As a long term investor in eBay I have done very well with the stock --until recently that is. Every January when eBay raised their fees, I knew it would hurt my eBay profit margins but I made up the losses with the gain in my eBay stock. Lately I am starting to wonder if the bloom is off the rose.

Here is a look at what eBay stock has done over the last three months. The blue line is the stock price and the red line in the 50-day moving average. eBay split just about a year ago this month. The post-split price was around $44. As this newsletter goes to press the stock is hovering around $31 --a 30% drop in one year and most of that in the last month.

eBay Stock Price February 1st to May 5th, 2006

The Wall Street Journal recently reported that eBay is searching for an ally against Google. Rumors are flying that eBay is for sale or will merge with Yahoo or Microsoft. Who knows if these are true?

Yahoo's investment in Alibaba,eBay's main competitor in China, makes that alliance unlikely and I don't see Microsoft out and out buying eBay --it's not a business they would know how to run. But, I wouldn't rule out some sort of strategic alliance with Microsoft.

eBay has managed their profit growth by growing users and annually raising fees. If you can believe eBay, they continue to grow their user base but raising fees is becoming harder to do as sellers flee every time they do this.

eBay's early success came from listening to users, but we now play second string to Wall Street. Executives of public companies keep their jobs by pleasing the Street first --their clients and customers second. Of course this only works for a while --eventually the customers leave and then you don't have the profits to please the street.

I fully expect Meg Whitman to exit soon --perhaps as soon as eBay Live! next month. She has presided over eBay's phenomenal growth and won't want to be at the helm as eBay sails into rocky waters.

So what does all of this mean to sellers like you and me? eBay will always be a --if not the, major player in online auctions, but it is clear that more competition is coming. eBay has apparently made a strategic decision that future profit growth lies with acquisitions such as Skype and fixed price shopping portals like shopping.com and the about to be launched eBay Express. eBay will always be the heart of my business --but I will be expanding into new channels: Overstock.com Auctions and other auction sites like Bidz.com, Bid4AssetsAmazon eShops, etc.

If you are thinking of starting an eBay business, it is still possible to do so, but you should have a very specific strategy. If you already have an eBay business, keep it, but start looking at other channels to sell into.

I recently placed a new article on my free articles page: Can The Little Guy Still Make Money on eBay. I would suggest you give it a read.

If you haven't yet read The Complete eBay Marketing System, I am running a special "Free Shipping" offer for the month of May that will save you $9.90 on this six-pound package to help you get your eBay business up and running the professional way.

3. Bidz.com Surpasses eBay as The Largest Seller of Jewelry and Watches on The Web

Bidz.com auctions has recently surpassed eBay as the largest seller of jewelry on the web. The upstart auction company proves the value of niche marketing. Admittedly jewelry is a pretty big niche, but Bidz is another example of the importance of specializing. Several other general purpose auction companies have tried to compete with eBay and failed, but there are several specialty auction companies doing very well.

One of the neatest things about Bidz is that if you do your research with a tool like HammerTap, you can actually buy on Bidz and sell on eBay. I met a seller last week who is doing that exact thing. I asked her to show me her auctions which she did on the condition that I not reveal them to anyone. I can tell you that she is running about 30 auctions a week and about half of them are for goods she bought on Bidz.com. She averages about $130 profit on each item she gets from Bidz. She told me it takes her about two or three hours of research a week to find the items.

4. Try HammerTap Research. One month for One Buck.

By now all of you know I am a big believer in research. With Hammertap's latest release of Hammertap Research, I think they now have the most powerful eBay research tool --in my humble opinion, it blows away Terapeak and Andale.

They are offering a one-month trial subscription for just a buck. Give it a try. You can use HammerTap Research to reveal market trends and develop eBay strategies that will help you make money on eBay. I urge you to sign up soon and if you are going to eBay Live, be sure to visit them and get a demonstration of exactly what this powerful software will do. Hammertap will really put money in your pocket if you take the time to learn it and use all of the features.

Some time after eBay Live, I will be doing a joint online meeting with Jen Cano from Hammertap where we will show you how to turn research data into dollars in your pocket. In the meantime, the best book on the subject is Ina Steiner's Turn eBay Data into Dollars available now from Amazon.com or from her web site at www.auctionbytes.com.

5. eBay Express Launched and eBay Stores Revamps Their Resource Center

eBay Express is now live at: www.express.ebay.com. This is the long-awaited launch of eBay's fixed price shopping portal. So eBay built it --and the question is "will they come?" Let's hope so. eBay has put a lot into this and strategically they think this is a big part of their future. As a store seller I welcome the additional exposure and will be anxious to see if eBay Express can deliver the customers. Click here to read how to get your store items automatically listed in eBay Express.

eBay announced a new resource center for eBay stores owners. If you're an existing eBay Stores seller, be sure to visit the main toolkit page at www.ebay.com/storesoverview to get tips on how to build, manage, promote, and track your Store. Then Download the eBay Stores Success Checklist to take advantage of all the powerful tools and features offered on the eBay Stores selling format. eBay Express is now live and remember that items will be fed to eBay Express from your store listings --so you want to make sure your listings are optimized for this.

6. eBay Niche of The Month --Old Advertisements

It is amazing what people will pay for old print advertising such as posters or advertisements clipped from old magazines. I recently took on a consignment lot of old HO train stuff. Included in the collection were some old train magazines from the 1940's through the 1990's. The older magazines were easy to sell and brought high prices, but as I moved up to the newer ones, the values I could realize on eBay started to drop.

I heard about people buying old advertisements and did some research on eBay and again using HammerTap Research. Some old ads, which were nothing more than pages clipped out of magazines were selling for as much as $20 each. Considering I could only get about $5.00 for an old magazine, that seemed pretty good so I tried. In a mid-60s Train magazine, I found a half-page ad for The City of New Orleans train and a full page ad on the back cover for Camel Cigarettes. I bought pre-cut cheap mats at the local art & craft store for a couple of bucks each and taped the ads inside the mats and took a couple of photos using my copy stand (available from www.ezauctiontools.com). The Camel Cigarettes ad only went for $9.99, but the City of New Orleans ad blew me away. It sold for $32.72.

The next week I found some 1960's vintage Road & Track magazines at a garage sale for 50-cents each. I stuck with the full-page color ads for old sports cars. Depending on the car they sold for between $7.99 (my starting bid) and two for old Corvettes sold for around $14 each. That is a phenomenal markup. It is a lot of work to find the magazines, flip through them, carefully cutting out the ads and mounting them in mats, but if you have the time to do this, I think you could create a $1000 a week eBay business with just this one niche. If you had a teenager you could put to work doing the cutting and matting for you, this could be an even bigger business.

The neat thing about this business is that you are selling to collectors. Once you sell to them you can capture their names and market direct to them as you get new stuff.

If you research ads on eBay you will see a lot of them going for around $5.00 to $10.00 and the sell through rate is not that high. I found that by selling my ads matted--ready for framing, I had a much higher sell through rate and achieved higher prices.

If you want to find great niches, check out James Jackson's FindHotNiches. It all begins with Keyword research. If you know the keywords people are searching, you can easily find the niches. James is running a $1.00 trial membership right now --but I don't know how long he will continue it. When you subscribe you also get some great free bonuses.

Speaking of Garage Sales, I recommended a book a few months back called Garage Sales Strategies. A lot of readers bought it and sent me great comments. I have a copy myself and use it all the time.

7. New Wholesale Sources for May 2006

I originally created my Top Twenty Wholesale Sources for eBay PowerSellers as a loss-leader to introduce people to my web site and the other products and services we offer --but the sales of this little product at just $2.99 continue to blow me away. The other thing is that people love it. $2.99 is not a lot of money, but I still offer a refund if someone is not happy. I guess people like it because I rarely get a refund request.

My Free Wholesale Search Engine continues to generate lots of traffic. When I looked at my web site statistics it is one of the most visited pages on this web site.

Everyone wants to sell something that no one else has --so that's the sort of wholesale sources I searched for this month.

Sue Houston is an up and coming designer of couture jewelry and handbags. The web site is just for info, you will have to contact her to become a dealer.

Holden & Co. is another distributor of some really unique lines of jewelry and accessories.

Fly fishing has a lot of collectors and aficionados. Here is a really unusual product if you are looking for that something that no one else has. The original fly candle. I won't try and explain it --just look at it and you will see the uniqueness. I saw these at the Seattle Gift Show and they were really creating a lot of buzz.

Boomerdog has nothing to do with dogs --although they use a labrador retriever on their logo. They sell unusual lines of glass ware and lacquer ware --and a really niche T-shirt. These are tee shirts that come with letters so you can create your own message --and change it every time you wear it.

No Web site --you will have to email or call this company for info. How about a chocolate Voodoo doll? Contact the Byer Connection at byerconnection@aol.com or call 925-943-6653.

The Buddha Board is a gray board that comes with a Japanese calligraphy brush you dip in water. When you write on the board, you message appears and then slowly disappears as the water dries. I know if sounds goofy --but I put one of these out at a party and everyone was playing with it. Be patient --this web site is really full of itself and takes forever to load. Probably made by some artsy-fartsy designer who knows nothing about how people use web sites. Anyway --its a great product.

Made By Humans sells a really unusual line of gifts and toys.

Anything made from Bamboo seems to be a hot seller. NW Wholesale carries a unique line of bamboo products.

Have you watched the hot TV Show, Deal or No Deal? Novelty Poster, Ltd. is about to start shipping the Deal or No Deal Game. They also carry a line of Sudoko games.

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Well that's it for this month. Good luck on eBay

Skip McGrath

P.S. I spend a lot of time on the phone - and my phone bills were getting pretty big. Earlier this year I discovered that I could save money by using a calling card - but there are so many squirrelly deals (hidden fees, rounding charges, and other ways to screw you) and it is really tiresome dialing an 800 number and then entering a pin number. Well I recently found Calling Cards.com I love the service - the rates are great and now you can Get 10 Free International Minutes - PINLESS If you use calling cards - or if you don't and would like to try them, check them out. I have tried cards from 4 different companies and are happiest with these guys. I call the UK a lot - and they have great international rates as well.