Global Online Business(2)
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Global Online Business(2)

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This power point was developed as a collaboration with the final author Steven Clevenger from Folsom Lake College, now a student at UC Davis. This highlights how easy it is to become an entrepreneur, ...

This power point was developed as a collaboration with the final author Steven Clevenger from Folsom Lake College, now a student at UC Davis. This highlights how easy it is to become an entrepreneur, in light of the difficulty students may have in finding employment, starting an eBay global business may be a great alternative.

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Global Online Business(2) Global Online Business(2) Presentation Transcript

  • Become a Global Entrepreneur
    • Internet auction website eBay is one of the fastest growing retail phenomenon of our time.
    • Since it was formed in 1995, eBay has become the world's leading online marketplace for all sorts of goods.
    • eBay was started by Pierre Omidyar in September 1995 as a result of his wife’s desire to add to her collection of sweet dispensers.
    • The site now has over 181 million customers worldwide.
    • At any given time, 29 million items are available worldwide on eBay, with more than 3.5 million new items added every day and $1,000 worth of merchandise sold every second.
    • The online auction site has 135 million registered users in 32 international markets, and more than 430,000 people in the United States alone make a full- or part-time living on eBay.
    • The five highest sales categories for eBay are: automobiles and auto supplies ($11.1 billion); consumer electronics ($3-5 billion); computers ($3.0 billion); clothes and accessories ($2.9 billion); and books, movies and music ($2.4 billion).
    • As any user will know, eBay features just about everything for sale, from the weird and wonderful to the plain and practical.
    • Even owners of existing businesses have found success on eBay by using it as an adjunct to their brick-and-mortar operations.
    • More than 724,000 professional sellers in the US alone use eBay as a primary or secondary source of income.
    • Setting up an eBay business is much easier than setting up any other business. All you need is a computer, credit card, bank account, and items to sell.
    • You can literally say “I am in business” in the morning and be making a profit by that evening.
    • Research eBay business opportunities
    • Open an ebay account and paypal account.
    • Sell a few items on Ebay to familiarize yourself with the process
    • Look for additional items to sell that you can make money on.
    • Most eBay sellers are also encouraged to open an account with PayPal , an online payment service owned by eBay that enables buyers to pay you by credit card or by debiting their checking accounts, without you having to obtain merchant card accounts.
    • You may also choose to use an accepted online merchant account company for the processing of credit cards. The more payment method you offer the bigger your customer base!
    • To be able to open a shop, you need to have a PayPal account plus a minimum score of five positive feedback reviews. Alternatively, if you don’t have a PayPal account, you need a minimum score of 10. You also need an automatic payment method on file to pay seller fees (credit card, debit card, bank account.)
    • Ebay no longer allows payments to be made in the form of Checks or money orders. Only online payment methods are allowed.
    • Merchant account are a good alternative to the high fee’s Paypal charges and will allow you to process VISA,AMEX, Mastercard, and Discover from many different countries. Generally fees on these transactions will be between 2-3% versus the 2.9-3.9% charged by Paypal.
    • Some good online payment ebay compatible online merchant accounts such as BluePay can be found via google.
    • Becoming an eBay member is relatively hassle free. This is one of the reasons it has more than 180 million members across the globe.
    • Things you will need before you start:
      • Bank account
      • Credit Card
      • Mailing address
      • email
    • Getting set up as an eBay seller is a simple process that takes just a few minutes. You'll be required to provide your name, address, e-mail and phone number, as well as a credit card number and your checking account information. This information is used to confirm your identity--which protects the integrity of eBay's operation--and to collect auction fees.
    • Simply choose a name and a password and you’re in. Remember your user name is also your seller name so pick something easy to remember. To start selling you follow the clear instructions giving details of the item you are selling and selecting the relevant subsection.
    • You can also use the advanced search option to locate the item you wish to sell and simply click “list an item like this”.
    • To begin your bountiful ebay venture you should list a few unwanted items from around the house such as old dvd’s, power tools, cell phones, ect.
    • Doing so will help familiarize you with ebay’s website functions and the process of listing, selling, shipping, and following up on a transaction.
    • To list your first item you can either use the ebay site auction builder or you can design your own on an HTML programmer and copy & paste the code into the proper section of the listing form.
    • Using the HTML method is what most ebay sellers use because it allows for ease of repeat listing, hotlinking of many images for free, and customized auction design.
    • Once you have completed the actual auction page you will have to choose a sale method. The two main methods are the auction and the buy it now set price option.
    • You MUST have a picture in your newly created listing’s. This is not required by Ebay but generally items without a picture will not sell.
    • You can upload pictures directly to Ebay or you can externally host them on your own web space and hotlink them into your auction. Generally this is the cheaper method if you have multiple pictures.
    • The auction is the riskier route but generally guarantee's a sale but can result in a lower than desired price. Generally if you start your auction at a low price it will attract more bidders and result in a higher final sale price.
    • You can also use an reserve price on your auction in order to assure a minimum price bid before the sale is official.
    • The “sell it now” option is the most widely used listing type on ebay. It allows you to list your item for a fixed price for up to 10 days.
    • The upside of this is if your item sells you get the price you were looking for. The downside is if your price is to high the item simply will not sell and you will get stuck with a listing fee.
    • The fixed price auction also allows you to offer multiple units of the same item for sale in a single listing.
    • Now that your item has sold you will need to collect payment. If your buyer does not automatically pay you send them an invoice via Ebay. You can also set your account up to auto-invoice a buyer right after the sale is completed in the seller options.
    • Once you have received payment from either paypal, your merchant account, or m.o. you will need to ship your item in a timely manner
    • Your three major options for shipping are Fed ex, UPS, and USPS. It is possible to ship online with all of these companies if you open an account with them. This will save you from having to wait in line at the shipping center.
    • Generally if you are shipping in the continental US and Canada Fed Ex and UPS will be much cheaper for mid to large size packages and USPS will be cheaper for small items.
    • You should always request delivery confirmation with USPS as most buyers will want a tracking number of some sort.
    • Once you have determined which shipping company best suits your needs you will need packing supplies. Buying these directly from the shippers can be very expensive. Instead of buying boxes from UPS or Fed Ex go around to local retail centers and ask them for their leftover boxes. Most will gladly hand over the boxes.
    • Supplies such as bubble wrap, packing peanuts, and packing tape can be had for a much more reasonable price from shipping companies. You may also be able to find a better deal through a third party supplier of shipping materials.
    • Now that you have all your supplies and the company you are going to use you need to pack your item(s). This needs to be done with the utmost care because damaged items reflect badly on your company even if it is not your fault
    • Wrap all fragile items in bubble wrap, space items apart from one another, and fill in any remaining spaces with a soft material like packing peanuts.
    • Make sure not to over pack a box. Recommended weight rating’s can be found on the sides of most boxes.
    • Finally Ship you item and your done!
    • After you have shipped the item make sure you follow up with the customer.
    • Leave feedback or DSR rating based on how the buyer fulfilled his/her role in the transaction
    • Send out tracking numbers for all the items you shipped.
    • Answer any further questions your customers may have.
    • "Starting an eBay business was quite easy. I think the most important thing is to find a niche that few other people are competing in, if you can do this then this is probably the best way to start an ebay business."
    • Being a generalized seller will work for your first month or two in business but eventually you are going to want to try and specialize
    • Sellers that are known for selling a certain kind of good will see a lot more repeat business. Also you will gain specialized knowledge on these products and be a much more informed seller
    • Look for product lines you have an interest in or ones that have netted you higher than average profits. These product lines should be the ones you focus in on.
    • Once you have successfully specialized you can begin to build a webite, ebay store, and find suppliers.
    • Unless you are already a well informed and experienced merchant start small. Go to local garage sales, flea market, and cruise craigslist.org to look for items you can resell for more money.
    • Eventually you will have saved enough money and attained enough experience to narrow your field of products and begin to specialize in certain products.
    • Now you will become known for selling these products and will need to seek out a sufficient supply to meet your growing demand.
    • One method that many ebayers have used with success is drop shipping. This is where you sell and item for a company at a slightly higher price than your cost. Then when the order goes through you forward it to the drop shipper who will then ship the item for you. After you pay the drop shipper you get to keep whatever is left over.
    • A note of caution should be taken when dealing with drop shippers. Many are not very reputable and can have poor delivery times and will sometimes simply not ship the item at all. Make sure you deal with a reputable drop shipper before putting you Ebay account and your reputation on the line.
    • If you strike an agreement with a wholesaler, you should be able to get a constant supply of warehouse stock for your new business.
    • Another common way of attaining stock is by liquidating dead inventory or bankrupt companies leftover inventory. The key is learning where and how to sell items some retail stores cannot sell. This works best with medium to small retailers.
    • Yet another option is to buy customer return goods from companies such as Sears, Wal Mart, and Osh. These companies take all their returned items and sell them by the truckload. Most of these items have nothing wrong with them and can be purchased at 20-25% retail price.
    • Security is a major issue with ebay as it is with anything involving money online.
    • Never give out your Ebay or paypal info in response to an email you receive. Ebay and Paypal DO NOT send out emails requesting information from you. Any issues with these companies are resolved through logging into your account via their website.
    • It is also generally recommended that you wait for all money order and check payments to clear before shipping the item.
    • Taking larger than normal payments through paypal can also be a sign of fraud especially if the requested shipping address differs from the billing address. Generally speaking sellers take a brunt of the losses whenever a fraudulent charge is reported by a Credit Card company or Paypal account owner.
    • Ebay is certainly the largest online marketplace but is fast loosing ground to other marketplaces in recent years.
    • Amazon.com and Craigslist.org are both incredible sales tools that are often neglected by die hard ebayers.
    • Craigslist.org is particularly useful for the small businessman/woman as it allows for free local advertising. This allows you to get at those buyers who prefer to see an item in person rather than buy it blindly over ebay. Also it is FREE so no fees are incurred and no labor intensive shipping involved.
    • While amazon is known for books it has also been the latest destination of many sellers and buyers dissatisfied with the ebay marketplace.
    • Generally Amazon has attracted wealthier buyers seeking quality new products rather than the low quality goods so often found on Ebay.
    • If you have access to high quality products and are in the habit of giving excellent customer service then in many way’s Amazon may suit your needs even better than Ebay. Selling prices are higher on most items and buyers tend to be more polite.
    • Setting up an Amazon account is very similar to setting up an Ebay account. Unlike ebay however there is a unofficial 30 day reserve on all new sellers. Amazon will hold your fund for 30 days to assure that you are a quality new seller but will release the funds once you have provided proof of shipment and completed a minimal number of positive transactions.
    • Unlike Ebay you will need to list an item already in the Amazon Marketplace. To do this search for it and click the “Sell your here” button to the side of the item window. You can also add new items to the marketplace if you have an Amazon merchant pro subscription which costs less than $20 a month.
    • As with Ebay you should promptly ship out all order and respond to all emails. Send trackign information out through your orders window and make sure to request good feedback. Your feedback score will largely determine your sales volume on Amazon. Even one negative feedback can reduce your sales by up to 30% for a week so make sure to resolve any problem ASAP.
    • Once you have established a reputation as a seller of high quality goods on Amazon your sales will take off any you will see many repeat customers. Amazon caters to a higher income audience so at time the customers may seem demanding but the profit potential is worth the effort.
    • Craigslist is the latest and greatest in local online business. Many ebayers miss out on their local market by not using craigslist as a buying and selling tool.
    • Craigslist is easy to use and best of all its FREE! You can simply post an add by clicking “post an ad” and choosing which category you wish to advertise in.
    • Craigslist is handy for buying inventory as well. In the early months of your business craigslist will prove invaluable to finding bargain deal from which you can earn money. You can take a broad approach and browse entire categories or narrow your search down by performing a search.
    • In my personal expirience use of craigslist boosted my sales by about 10% and allowed me to circumvent fees I would normally have to pay with an online payment service since these sales come in the form of cash.
    • Since every eBay business is a retail business, you should also register your business with federal, state and local tax authorities and consider forming a corporation or an LLC to protect you against legal liability. (For more legal issues you should know about before you start, go to www. entrepreneur.com/ebay/legaltips.)
    • Folsom
    • Sacramento
    • El Dorado County
    • Like all businesses the key to saving money on taxes is good record keeping. Once your sales volume starts to increase and your are sure that you want to pursue your ebay business at a higher level it is advisable to have a meeting with a CPA to discuss what records to keep and possible tax deductions to look out for. Also make sure you CPA is REPUTABLE and COMPETENT, doing so can literally shave thousands off your tax bill every year.
    • The IRS allows you to pay quarterly or at the end of the year. It is my personal recommendation that you pay at the end of each year due to the nature of this business. The penalties assessed for paying at the end of the year will be small in comparison to the extra income you will earn off keeping that money in your business for the whole year.
    • You are now armed with the very basic knowledge you will need to start a successful small online business using Ebay, Amazon, and Craigslist.
    • Ultimately the only person who can make you a successful business owner is yourself. An Ebay business is a low risk and low cost way to see if you really have what it takes to be self-employed. This form of employment if much more fulfilling than working for another person even though you will be working more hours than before. Being independent is the greatest feeling of all. You will never have to fear unemployment again and best of all you get to pick your vacations not your boss.
    • Good luck on your new business venture!