Somebody here at SaleHoo must be doing a fine job, because we seem to have a huge influx of new members joining up! As with all sellers new to online retail, our new SaleHoo members have a lot of questions about how to get started!
In order to help new sellers get on their feet, I’ve revealed the top 3 hurdles that make it hard to be an online retailer and offered some practical advice on how to overcome them.
The first one is a common dilemma faced by sellers, the question of what to sell.
1. Not knowing what to sell
The fact that “what should I sell?” is the most asked question on our forum tells me that this is a major hurdle for many sellers. And I’m not surprised: Not only do you have to come up with ideas for items to sell, you also need to determine whether those ideas are actually going to pull some profits!
Tips for deciding what to sell
If you don’t know where to start, just browse around the SaleHoo Supplier Directory and visit our supplier’s websites to get some ideas for products to sell (you’ll find links to the supplier’s websites in the listings in our directory).
Record a list of potential items and contact the suppliers to find out how much you can source the items for (don’t just go off advertised prices listed on the site, these are often not the wholesale price. You'll need to contact the supllier to get these). Note down those prices, and compare them with what the same or similar items sell for on eBay, or whichever marketplace you choose to sell on.
If you can compete with those prices, you’re onto a good thing!
If the numbers don’t work out, it’s probably because your competitors - sellers offering the same items - are buying in larger bulk, and therefore getting better wholesale prices that they pass onto their buyers.
2. Competing with other sellers
As a new seller, you will inevitably run into situations where you are competing against other well established sellers.
The trouble is that those more established sellers can overshadow new sellers for two primary reasons:
a. They have massive buying power so they can purchase items for a lot less per unit than new sellers on a tighter start-up budget. This means their prices will be lower, and much more appealing to buyers
b. They have a lot of feedback, so buyers feel more confident buying from them.
There isn’t a quick fix for overcoming these hurdles: In order to compete with lower prices, you need to save as much of your profits as possible and put them towards a larger wholesale lot because when it comes to buying from wholesale suppliers, the bigger the order, the bigger profits. This is simply because wholesalers can offer volume discounts when you buy in bulk, so you will be able to offer your buyers better deals and make more sales.
Also read: What is a Factory Authorized Wholesaler?
To overcome the issue of having less of a feedback score than other sellers, consider buying a few cheap items to help add some “bulk” to your feedback profile.
3. Dealing with competitive marketplaces
This crosses over with my last point about competing with other sellers; On popular marketplaces such as eBay and Amazon, there is a lot of over-saturation of popular product markets such as electronics. This results in new sellers failing to make enough sales or profit to make it worth their while.
This is hugely disappointing for sellers who work hard and want to earn some well-deserved cash.
There are two ways to render this:
1. Sell on an alternative marketplace.
I’ll never deny that experience on larger marketplaces, especially eBay, is useful for all sellers, but I highly recommend that sellers diversify by listing items on a couple of different marketplaces.
This is a good move because other marketplaces have less competition, but still a healthy amount of buyer traffic. Some favorite alternative marketplaces are Addoway and Bonanza.
2. Avoid selling highly popular items.
Unless you can afford to invest around $100,000 on a wholesale order, most popular items are off-limits to you at this stage. So what exactly do I mean by popular items? Things like mp3 players, laptops, cell phones, jeans and popular DVDs. Instead go for items that are a bit more off-the-radar such as sporting equipment, collectibles or antiques.
What has your biggest hurdle been since you started selling online?