Making Money on eBay the Smart Way

7 min. read
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Making money on eBay can be done without spending a dime. Lots of people do it, mostly by rooting through their attics and garages, even refrigerators, to find stuff they don't want or need, and then listing them in the hopes that someone will buy. It's pretty hit-and-miss, but if making money on eBay is just a hobby, it's all good. However, if selling online is something you intend to do for your bread and butter, then this half-assed way of doing it won't provide a happy ending.

So how do you sell on eBay the smart way?

Traditionally, you need to spend money to make money in retail. The first thing you need to realize is that the game has changed considerably since eBay and similar sites have provided anyone anywhere the opportunity to make money by selling online. Nobody ever said you couldn't use other people's money to make a profit for yourself.

This is what dropshipping is all about, and eBay remains one of the best platforms for this type of selling. Rather than money, you're investing hard work, business savvy, talent, organization, and a flair for choosing what sells.

Don't get me wrong: To do well on eBay, you still need to invest a little bit of your own cash to set up a supply chain, but don't worry; you'll get that back in spades if you do your prep work. Here's how to make a killing on eBay.

Choose Your Niche


Everyone is selling monopods for selfie aficionados, so you think you should go into that even if you think it's a little dumb. Believe me when I say that you don't want to get into something you aren't passionate about, especially if you plan to do it for the long haul.

For one thing, you won't be putting as much belief as you should in the product, and that will show through in your listings. For another, you'll earn a reputation for selling this type of product, and true-to-life branding is something you want to establish early on. If you love selfies and novelty products, then by all means go for the monopod.

If you're more into shoes, then selling monopods will be taking time away from your real interests.

Do Your Research


That being said, even if you choose a niche based on personal leanings, you still want to choose a winner. As a drop shipper, you are limited only by the inventory of your suppliers, and if you carefully pick your business partners, that's no limit at all.

To help you narrow your focus to what's currently selling on eBay, you could use a listing analytics tool such as the SaleHoo Market Research Lab. This tool can show you how many people are already selling the item you want to list, how they performed, and the overall profit potential. Once you've chosen the type of items you want to sell, it's time to move on to the next step.

There's an adage to the effect that a little knowledge is a dangerous thing. That can apply to nearly any business. Not going nearly far enough into your chosen field can land you in a heap of trouble. To make money on eBay through drop shipping, there are two things you have to know like the back of your hand: the eBay platform and your dropshipping suppliers.


Selling on eBay is not the same as selling well on eBay. The weekend lister may manage quite well on their occasional excursions into the fray, but as a serious seller you want to do as well as humanly possible. You need to seize every advantage available, and eBay can help you do that if you take the time to find out everything there is to know about it from a seller's perspective.

This includes membership tiers, seller fees, listing tools, policies, feedback, ranking factors, affiliate programs, so on and so forth. Knowing how your platform works often gives you a distinct advantage over less-dedicated sellers.

Getting to know eBay from head to toe requires a bit of time. Basically, you have to go back to school for this. Click on everything that is clickable, take notes, check forums, and ask questions. Ideally, you should do this prep work before making your first listing, but it's really up to you.

You could make a test run with a few items that you already have on hand just to see how it goes; consider it on-the-job training. If you make mistakes, make sure you don't make them twice. Finally, keep in mind that the customer is always number 1; you don't want to risk getting negative feedback for selling a dicey Magic 8 Ball. Whatever happens during your test run, be honest, be nice, and be responsive to your customers.

Your Suppliers

This has been repeated ad nauseam throughout this blog, but it's so important that it merits being mentioned at every opportunity: choose your suppliers wisely. Price is important, of course, but there are other factors that come into play. Most importantly, the supplier has to be reliable and professional. As a dropshipper, you know that your lifeblood is in the fulfilment. If your supplier fails you, your business fails.

Take the time to thoroughly investigate your potential suppliers. If possible, visit the place of business to see how it's run; a sloppy and disorganized operation is something you don't want to have anything to do with. Ideally, you'll be dealing with wholesalers based locally. If you are importing your products but visiting the supplier is out of the budget, subscribe to a directory of vetted suppliers to make sure they are legitimate.

Make a few small purchases from your chosen suppliers to test how fast they deliver, the quality of the products, and the way they're packaged. Some buyers don't like to deal with drop shippers, so it's important to see whether your supplier will brand the products the way you want.

You will also be able to check how well your supplier communicates with you as a drop shipper. This can be crucial once you actually start selling the products. You should be able to easily track inventory and purchases. If any problems develop you must be able to get on top of things and quickly respond before your buyer has a chance to get cranky.



Once you've done your homework, you can start listing, perhaps using the bulk listing tool available on eBay. The next step is to improve your exposure so that you stand above the rest. There are some good ways to do this, and you should do all of them if at all possible.

Get a PayPal Account

eBay provides protection to both buyers and sellers that use PayPal. Furthermore, it is a secure and convenient way for a buyer to pay for purchases. As a consequence, 90 percent of users have one and most prefer sellers who offer this payment option. This will improve your exposure immensely to buyers who filter their search for sellers who take PayPal.

Price Competitively

You should keep your eye on your bottom line, of course, but you also need to make sure that you compare favorably with how other sellers for the same or similar items are pricing their items. Many buyers rank their searches from lowest to highest prices, and like in any Internet search, the top results get the most attention.

Offer Free Shipping

Freebies are always attractive to buyers, and one of the most compelling offers you can make is free shipping. Analysis of buyer behavior indicates that at least 80 percent of buyers are most likely to complete a purchase if the seller offers free shipping.Many will even filter a search for only items that have free shipping.

To protect your profit margin, add in the cost of shipping to the item price or bundle items to reduce shipping costs.

Craft Quality Titles and Descriptions

You should put some thought into writing an attention-grabbing title and comprehensive product description. This is a key factor in making money on eBay that many sellers just don't take seriously.

Your title should be concise but searchable, so make the effort to find out how buyers search for particular items. You can do this by typing your item into the search panel and see what suggestions come up.

You can also take a look at Google Adwords to see what related keywords and phrases are sizzling on Google. Oh, and make sure you make no typos in your item title; it makes it harder for buyers to find you.

Be a Power Seller

About 4 percent of all eBay sellers become Power Sellers. That's a great advantage to have not only because of the perks; it's also powerful testimony to your integrity, professionalism, and credibility. This gives buyers the confidence to do business with you.

Needless to say, it is not easy to become a Power Seller (otherwise more would have the title). However, given the value of being one, you should go ahead and make the effort to become eligible. The requirements include:

  • Active membership for at least 90 days
  • Minimum average sales of $1,000 and average listings of four monthly for three consecutive months
  • At least 100 feedback with a minimum of positive rating of 98 percent
  • Good account standing
  • Compliance with all eBay policies and rules

Making money on eBay isn't hard, but making a lot of it takes time and effort. If you are serious about making a good, if not fantastic, living via your eBay sales, you would do well to take the advice in this article to heart.

For more information about selling on eBay, check out the Seller Training Center.

About the author
Simon Slade
CEO of SaleHoo Group Limited

Simon Slade is CEO and co-founder of SaleHoo, a platform for eCommerce entrepreneurs that offers 8,000+ dropship and wholesale suppliers, 1.6 million high-quality, branded products at low prices, an industry-leading market research tool and 24-hour support.

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  • Kris Moleski 3rd of September
    I actually have 2 Ebay accounts. One is my Ebay Store for my company and the other is my personal Ebay account, I use both because I need to list more than the limit they set for you in the first 90 days. I have only been selling on Ebay for my store since August and I am already on track to become a Power Seller. I sell things is my favorite sound on my phone...ching ching... I know I just made money! It has really been unbelievable to me...walking in the grocery store..ching ching...watching TV..ching ching.... I love it! With that said, it is definitely NOT easy... I have been researching for a few months by trail and error the best wholesalers and products that work for me. I research, research and research! I opened an E-commerce website that right now I have on hold because for three months it was up and I thought.... I guess I need to learn more about Google, site maps and more. I spend hours and hours researching wholesalers, other Ebay Stores with my same items...I even purchase from other Ebay Sellers products I like, and when I get them... I see who makes the items and I contact them directly and open wholesale accounts....I do this at the mall stores I like too...... I go to other websites and order the products too. I order from the Ebay International stores to see how that works as a buyer. I had my first sale for my products from another country, so I got to experience the seller aspect. Ebay makes it easy with their International shipping.... you just ship the product to them instead of the buyer and they put it through customs and collect all the international fees from the buyer. Easy! One of the big things I have done recently is go to the wholesale vendor conventions at the marts in my city! If you have a Sellers permit, Fed Tax ID number, and actually LLC, a website...and such...then you can request a pass to get in for the weekends! Then you get face time with the vendors you want, can touch and feel their merchandise and see quality. I don't do the drop shipping thing.... I like being in control of the inventory and having the personal touch of shipping and adding thank you notes and specials. I know they will be packaged to my standards and I can answer my customers questions intelligently about the products, shipping or whatever they need. All the information here about Ebay from SaleHoo has been extremely valuable to me and I do everything it says....basically.... except the drop shipping. I really don't understand the ins and outs of that.... Start slow, be constant and provide excellent customer service....FIVE STAR Service!
    • Melissa Johnson SaleHoo Admin 4th of September
      Hi there, Kris!

      Certainly, dropshipping can be tricky when you want have tight control over your inventory, but it's still workable. Many good suppliers will feed you a direct line to their inventory, and some will even package your materials in with a purchase when it ships. You can even still run specials while dropshipping!

      If you do want to learn a bit more about dropshipping, we do have an in-depth guide available here:

      I'm glad your selling experiences on eBay have been so positive, and wish you all the best!