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Running a Bulk Reseller Business

Let’s say that this business model sounds good to you. What’s life like when you choose to be a bulk reseller?

Making the Buy

Probably the most important part of bulk reselling is making the initial product purchase. That means scouring the liquidation and closeout websites, looking for the best buys, and then ponying up to place an order. Some eBay sellers watch the sites for weeks on end, waiting for that one load of merchandise that has the best potential. You definitely shouldn’t make a buy at the first site you visit. Shop around, like a serious consumer, and be savvy about what you finally buy.

Of course, making the buy means writing a big check—or, more likely, making a big charge to your credit card. Most of these websites accept credit card payments, some accept checks (although business checks are more accepted than personal checks), and some will even let you open an account of credit, providing you meet their business requirements. In any case, you’ll probably be laying out $1,000 or more in a single purchase—which you won’t get back until you sell all that merchandise.

When you’re making your purchase, pay attention to shipping charges. Some liquidation sites offer free or discounted shipping for large orders, but most don’t. You’ll definitely want to factor in the shipping to your order’s total cost.

And that shipping cost could be hefty, since you’re receiving a lot of merchandise. Here, size makes a difference. A lot of 1,000 socks isn’t that big a shipment, physically, while a lot of just 100 television sets can cost a ton to ship. Make sure you get an estimate of shipping costs up front, before you finalize the order.

Storing and Managing the Inventory

After you place the order, you wait around for the merchandise to arrive. This is a good time to plan out exactly where you’re going to store those 1,000 frying pans or 100 electric motor scooters. That’s one of the challenges of buying in bulk—warehousing in bulk. Move the car out of the garage, clean out the basement, talk to Aunt Edna about taking over her spare room. You may even need to rent a storage bin or other warehouse space.

Receiving the merchandise could also be a challenge. Depending on what you order, you might be surprised to find a huge semi truck pull up outside your front door. The merchandise could be packed in multiple manageable boxes, or it could be loaded into a single large pallet. And that truck may or may not have a lift in the back—which means you could be faced with manhandling a huge crate off a truck platform five feet off the ground. Avoid surprises by finding out how the item will be shipped before you order.

When you finally warehouse the inventory, you’ll need to do so in a way that organizes the individual items and makes it relatively easy to pick and pack from the lot. You don’t want to store everything in a huge stack. Put the size 32 reds in one place, the size 34 blues in another, and so on. Then make a map or guide to all the bits and pieces of your inventory, so you’ll know immediately where to go when you get an order.

Speaking of getting organized, you’ll also need to create some sort of inventory management system. You’ll want to know at any given time how many small, medium, and large items you have, and in what colors. After all, you don’t want to take an order for an item that you’ve sold out of. Managing your inventory can be as simple as creating a big Excel spreadsheet, or as complex as writing your own database program. Many eBayers strike a middle ground by using an auction management tool that includes an inventory component. However you do it, it’s important.

Managing the Auction Process

Once your inventory is stored and cataloged, it’s time to start selling. One of the nice things about buying in bulk is that you get to sell the same items over and over again. No need to reinvent the wheel here; you can take one photograph and reuse it in hundreds of auctions, just as you can with your item description and other copy. You can also figure out your shipping costs ahead of time, which makes the item listing process that much easier.

One thing you want to be prepared for is that you probably won’t be able to sell the entire quantity of what you ordered. Among those 1,000 Tommy Hilfiger shirts you ordered will be one or two in such an ugly color or unusual size that no eBay buyer will ever be interested. At some point you’ll give up on the last of these leftovers, which means writing them off your books—and eating the cost of that unsaleable inventory.

By the way, when you have this much similar inventory to sell, you should consider augmenting your eBay auctions with a permanent eBay Store. An eBay Store is a good place to sell bulk merchandise, as well as to "park" those items you haven’t put on auction yet. Turn to Chapter 26, "Opening an eBay Store," to learn more.

Packing and Shipping

You’ll also want to set up some sort of assembly line for packing and shipping your items. Since you’ll be shipping out lots of the same thing, you can get by with a single type of box. And you can save money by buying that box in large quantities. If you know you’ll be selling 1,000 items, you might as well order 1,000 boxes.

Ah, but where do you put 1,000 boxes? This presents another storage challenge, but it’s probably worthwhile, considering the discount available for buying packing supplies in bulk. Just something else to plan for ahead of time.

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