eBay Sellers - Follow Kevin O'Leary's 10 Rules for Success

Hey eBay sellers!

I have been spending a lot of time with my 30-day YouTube challenge. I hope you are enjoying the content and find it useful.

I wanted to share this video of Kevin O'Leary's Top 10 Rules for Success. If you don't know Kevin, he is a billionaire investor and the "bad cop" personality on Shark Tank. He has many good points that apply to entrepreneurs and eBay sellers.

To summarize:
1. You have to sacrifice a lot. 
eBay application: It takes time and patience to build this business. 
2. Trust your gut.
eBay application: When you have that intuitive nudge that an item will sell,  is interesting or collectible, stop and research it. That's the universe talking to you.
3. Diversify.
eBay application: Get out of your comfort zone and try new things. Opportunities are everywhere. Get out of your own way and LEARN new things.
4. Have a back up plan.
eBay application: Learn to sell on other sites, Facebook buy and sell groups, etc. Spread the risk around.
5. Be a leader.
eBay application: Tell every one you know what you do. Shout it from the rooftops. You never know what kind of opportunity will fall in your lap because you know this skill. Example - my hair dresser just connected me with a client who has $15,000 worth of jewelry to sell on consignment. 
6. Admit your weaknesses.
eBay application: I am not good at graphic design, accounting, doing taxes, or programming. I pay people to do those things so I can make money writing, selling on eBay, consulting, and other tasks I enjoy and excel at. 
7. Buy stocks with dividends. 
No comment here - I'm not qualified to give investment advice.
8. Differentiate between family, friends, and money.
eBay application: Be careful who you do business with. Period. Don't sell on consignment for family. It never ends well.
9. Get outside of North America - go global.
eBay application: Ship internationally. Discover how easy global shipping is here!
10. Go with simple ideas. 
eBay application: Don't overcomplicate things. Take good photos, use good keywords, describe your item properly, be customer friendly, treat customers the way you want to be treated. Shop, list, ship, repeat. It's easy.
If you aren't watching Shark Tank, make it your new habit. Watch on ABC, CNBC or on YouTube. The Sharks are billionaire entrepreneurs who have great wisdom to share - listen to what they tell start-ups. 
And check out my YouTube challenge here!
Have a great week!
Related Posts:
eBay Success Depends on Good Record Keeping
Consignment Done Right - 140,000 Items
eBay is Marathon not a Sprint

If You Are Earning Money on eBay - Listen Up!

This is not a "what to sell" post or a "hot discontinued item" post, but I recommend you read it anyway. It could save you a lot of time, money, frustration, and disappointment in the future.

If you are selling on eBay, and depend on the income, or ever want to rely on the income to prove you can afford a mortgage loan, start preparing now. If you have any plans to move, downsize, or rent, start getting your paperwork in order now. Even if you already have a CPA.

Here is the problem. If a CPA has been doing your taxes for you, that is great! A CPA is trained to make sure their clients pay the minimal amount of taxes. With self-employed people and entrepreneurs, their goal is to whittle down "adjusted gross income" so that taxes owed are minimized. This is what accountants are trained to do. Unfortunately, CPAs and mortgage lenders are looking at financial information from two different perspectives. The CPA is looking a how low he can get your income so taxes are minimized. The mortgage lender (or apartment leasing office) is looking at a person's income and ability to pay, which is the amount of income they have claimed and what they pay taxes on.  Usually, you can't have it both ways - if you are self-employed, you may have to strategically prepare tax returns so that you can qualify for a mortgage.

This is where worlds collide and it isn't pretty. Let's face it, self-employed people can look bad on paper. Because of all the deductions we can take, and how we pay expenses out of our business accounts, our taxable income is usually much lower than what we actually "take home." I have talked to several sellers lately who have run into the problem of not being able to prove their income to get a mortgage. They may be able to afford where they live now and have excellent credit. But after the housing crash in 2008, lenders look at self-employed people much differently - as a risker borrower. It is all about how the numbers line up on the Schedule K (if you are an S-Corp) and how much of a salary you take. Bottom line:

The mortgage process is designed for people with a regular W-2 income, not entrepreneurs. 

I am not a CPA or a tax professional, but I am telling you to consult one if you have any plans of moving in the next 12 months. Make sure your CPA knows your goal of getting a mortgage loan or renting a new place. If you aren't showing enough income on your tax returns, or taking an official salary, you may not be able to qualify for a mortgage or even a rental agreement. It is tough out there for single self-employed folks when eBay is the only source or income, or both spouses are self-employed. This post not meant to cause panic or alarm, but to inform so you can prepare.

Start looking into this now because you may have to make adjustments to show more income so you can qualify for what you want in the future. You may need to show fewer write-offs or take a larger salary to make the numbers work. Disbursements usually don't count - you need to show a salary.

If you don't have a CPA, now is the time to find one. Check around in your area for CPAs who offer free initial consultations.  Call the Chamber of Commerce or use our good friend, Google. This is a great time of year to start a relationship with a CPA - come January through April they will be slammed during tax season.

And if you aren't keeping records on your sales, you certainly should be. (I recommend this spreadsheet for eBay sellers.) Get your paperwork in order now. Taxes and accounting definitely aren't the fun part of eBay, but just grit your teeth and do it anyway. Your future self will thank you.

A few tips:

1. Keep good records. Record all inventory purchases, fees, and supply expenses. KNOW WHAT YOUR PROFIT IS AND HOW MUCH MONEY YOU ARE MAKING. (Yes, I am yelling!!)

2. Don't co-mingle personal and business money. Lenders don't like to see that.

3. Mortgage lenders will look at 2 years of tax returns - so make sure you have enough time to get the right documentation in order before you plan to move. (Talk to a CPA!)

4. Work on improving your credit score. Self-employed people have been stereo-typed to have lower credit scores than W-2 employees.

5. Start saving for your down payment. A larger down payment may help counterbalance any self-employment income issues.

6. Talk to a CPA and different mortgage lenders. Seek out lenders who work with entrepreneurs - they may have some workarounds or connections that will help you. Some lenders won't even work with self-employed people because of all the extra paperwork and hassle.

Here are some helpful resources if you are considering buying a house (that includes downsizing) if you are self-employed (even if one spouse is self-employed):

Self-Employed? Good Luck Getting a Mortgage

How to Qualify for a Mortgage When You are Self-Employed

Self-Employed? How to Get a Mortgage

Pros and Cons of Selling Electronics on eBay

Electronics can be a lucrative product to sell on eBay, or they can be a nightmare. Before you jump into selling electronics, which many new sellers often do because the profit margins can be high, do your due diligence about the product. Here are some precautions you should take before selling electronics on eBay.

1. Make sure the item works. Whether it is a laptop computer, smart phone, children's educational toy, or a small appliance, do your it homework and make sure the item works properly. You may have to educate yourself or ask someone who is more familiar with the product than you are. For example, if you are selling a vintage camera, you may need to do some research to learn about the product, parts, and how it works.

2. If the item does not work, either list it as is with flaws, or sell it for parts. There is nothing wrong with selling a non-working electronic item on eBay, just give full disclosure in the listing.

3. If the item has a serial number, take a photo of the item to include in the listing. If the item is returned, you can verify that the item returned is the same item you sold.

4. Beware of selling mobile phones. Buyers will often strip the phones and sell the parts at pawn shops or on the street. Then, they will return the phone claiming it does not work. You will end up with a non-working phone and forced to give a refund because the buyer can show the item was mailed back to you with tracking. (See Frankenstein phones.)

There is nothing wrong with selling electronics that don't work. There are collectors who want these items (like old record players, radios, and telephones) and either will use them for home decor or will repair them. Just make sure you know exactly what you are selling, and disclose this information in your listing.

Related Articles:

Vintage 1970's Items to Sell on eBay

How to Reduce Returns on eBay

How to Recover from Below Standard Status on eBay

Make Money Selling Lots of Scrabble Tiles on eBay

Here is another "odds and ends" type item you can make money selling on eBay - Scrabble tiles. Scrabble games are an easy find at garage sales and thrift stores. Rather than selling and shipping the entire game (where the box may be crushed or torn and unappealing anyway), salvage the tiles. Let them accumulate over time and you have a item that is easy to ship in a padded flat rate envelope for $5.35 (with your eBay discount).

Your next question might be, who the heck would buy several hundred or thousand Scrabble tiles? Crafters, that's who. And what can be made from a bunch of random Scrabble tiles? Here are some examples:

Baby Gifts

Coasters

Teacher Gifts

Jewelry

Christmas Ornaments

You get the idea. eBay shows 682 sold listings for "Scrabble Tiles" in used condition. You can sell the wooden letter racks in lots as those are used for crafts also. The colored tiles will sell for more as they are more scarce. (Remember, the more scarce something is the more it is worth.) Just a ball park figure - a lot of 300 wooden tiles sells for about $25.

So make yourself a little Scrabble Tile stockpile area and start adding to it when you see incomplete or less than optimal Scrabble games at garage sales and thrift stores. Crafters will thank you!

Related Articles:

Don't Throw That Trash Away - Sell it on eBay

Sell Damaged Cashmere on eBay

Sell Old Tractor Parts on eBay

Working a Full Time Job While Selling on eBay

 

Many of you out there have a full-time job outside the home and sell on eBay in your spare time. Others have been selling on eBay for a while full-time and may need to go back to the 9-5 for whatever reason - benefits, more predictable income, or saving for retirement. Antonette recently asked this question on my eBay Seller Facebook Group:


"Does anyone work a conventional job as well? I had to go back to the 9-5 because my husband was hurt on the job and didnt recover well from his surgery. I am having a hard time getting things posted. I need the ebay income as well. Just wondering if you have any advice, best practices."

There were some great answers!

Becky said, "Maybe break it down, like do photos for 20 listings 1 night, then weigh them, then sit down an list them all. You can schedule your listings so that 1 to 3 a night go live. Then while those are going live each night repeat the process."

Sharon said, " First, I try to list at least one item per day. Then at least something new is getting out there. Second, I am more selective about what I buy. I don't buy something unless I think it will be a $20 profit, and I shoot for a $30 profit. Since I don't have a lot of time to list, this helps. For sourcing, I do some on Facebook Grops so I can be at home or wherever when I do it. Otherwise, I go out one morning every couple of weeks to garage sales and thrift stores. I also ask friends and family for inventory and that works well (obviously sometimes my profit on those items is lower, but I didn't have to spend time sourcing them). I tend to have about 110 items listed at one time."

Suzanne said, "One thing that I have seen others do, is let the kids be involved in the eBay process. They could help find things to sell, take photos, learn to research, eventually learn to list etc, that way it could be a family project that generates income. Great family time together also!"

Nancy said, " I work full time. I shop and photograph on weekends and then can list each night a few things, or depending on time and how many items I may list on the weekends as well. I have grown children though so I do have more free time after work."

Ashley said, "I hired a virtual assistant for selling a few days ago. I also work full-time with an assistant. I can't do it all. When you delegate (your kids, spouse, whatever you have) you share the work and the wealth."

I honestly don't know how some of you juggle a full-time job, children, and eBay. Kudos to all of you for making it work.

Related Articles:

Hiring Help for a Small eBay Business

5 Ways to Save Time and Money Printing Shipping Labels from Your eBay Account

eBay Seller Success Story $6,000 in Sales in 30 Days