I finally finished my taxes this week. I had filed an extension. (Why do I do things like that?) It just gives me more time to put it off and worry about it every day (well at least every other day!). So now it is time to celebrate!! At least until 12/31/08 when I can start worrying again. Just kidding.
- Lynn Recommends: Janelle Elms’ eBay Store Makeover Course
- Special Announcement: My first ever Webinar!
- Feature Article: A guest article from Joel Elad
- The Queen’s Update: We want to hear your stories
This ezine is published once a week.
September 25, 2008 Volume IV, Issue 37
This week and past weekend have been crazy. All because of those taxes. I barely had time to list on eBay but I was fortunate enough to find a beautiful set of Wedgwood dishes at my local thrift store for $100.00. I broke them out into about 50 auctions and should do real well with them.
I say my thrift store because when Mo saw them in the eBay room she said, “I thought about buying those.” And I was like really–you were actually in a thrift store on my side of town! So now I really don’t feel bad about going into her thrift store on occasion.
Here is one of the dinner plates.
After last week’s ezine, I got an email from my friend Mark Furrer of Online Market World. He used to run all the eBay Live events and he just cracks Mo and I up. Here is what his email said (he has a very dry sense of humor):
It’s not called a “point” in baseball…it’s called a “run”…you ninny.
Photo of Mark, Me and Mom
By the way, Mark’s company is having a huge event in San Francisco October 1-3. Check it out here. One of the keynote speakers is Marsha Collier. So, if you are in the area, I highly suggest you check it out.
This week has also been crazy because Carmen’s Grandmother fell last Thursday and she is in the hospital. Carmen has been out all week and Mo and I are trying our best to be her but she is a very hard person to replace. We miss Carmen and our thoughts and prayers are with her and her grandmother.
Luckily my friend Joel Elad emailed me an amazing article he had written about how to buy at live auctions and resell on eBay. He said I could use it anytime I needed a guest author. Well, with everything going on this week, I could certainly use the help. I am pleased to present his very interesting and thorough article as our feature this week.
I am very pleased to announce my first webinar ever. It is going to be on Tuesday, September 30th at 1 pm Pacific. I am going to show how to make some of the eBay global changes that are taking place in October. I will also be showing how to change the media requirements that take effect on October 5th. Please read the Special Announcements Section to learn more. This is the Queen’s Court gift for the month.
Even though Janelle Elms’ Store Makeover course started last week, there is still a way for you to join in. I was a special guest on her course last Friday and what I heard in the 15 minutes before my section made me a true believer. eBay stores are so important so please make sure you read the Lynn Recommends section to learn more.
Finally, we are continuing the section where you write in with your major scores! Please read The Queen’s Update section to learn more about submitting your stories.
Even though Janelle Elms’ eBay store Makeover Course started last Friday, her webinar was taped and you can still join in and make it for this Friday’s Webinar.
After listening to 15 minutes of Janelle’s course last Friday, I knew that it was a course that I should be taking! She talked about how she will be teaching her students how to take the 12% eBay store fees down to 3%! I was hooked.
Janelle will be teaching about eBay Stores for the next 5 weeks. Her program includes 4+ hours of video training, 6 hours of newsletter training and then 10 hours of live coaching classes with Janelle.
Classes did start last Friday, but that class was recorded so you won’t miss anything. AND you can be on the line for the next class this Friday (tomorrow), so please check it out here.
If you are thinking about taking your eBay store to the next level, you owe it to yourself to check it out. You can read more about the course here.
Get Ready for eBay’s New
I am going out on a limb here and having my first Webinar. How exciting! A webinar is an event where we are all on the phone together and you watch what I am doing on my computer on your own computer screen.
The computer screen will be recorded and the audio will also be recorded so you don’t have to be live with me next Tuesday, September 30th at 1 pm Pacific Daylight Time. (This is subject to change due to the fact that I must make sure that the global change tool is ready).
I am going to show how to make the changes for the max media rates that are required by October 5th.
I am going to show how to make the global changes for the required handling times and the required return policy that needs to be done by late October.
‘Make Your Money at Real Live Auctions’
by guest columnist, Joel Elad
Here is a great article from friend and eBay expert Joel Elad. (www.JoelElad.com)
Joel and the gang from eBay Live!
When people hear about using auctions to make money, they normally think about using eBay to sell things to the public via auctions or fixed prices. However, there are other ways of using auctions, and the one I’m going to discuss is going to live auctions to buy things for resale. Even with eBay and all the other Internet sites out there, auctions are occurring every week, month, and a quarter in most parts of the United States, and there are still deals to be had when you buy the right products and resell them for their true value.
The startup costs are practically nothing, depending on what resources you have available or can access, and what areas you want to specialize in as your niche. Therefore, instead of dollar amounts needed to start, I’ll talk about things you need to get started and leave the estimations up to you and your situation:
- A niche, or product specialty. Walking into an auction blind, thinking you can buy anything there and make money, is one of the WORST mistakes you can make. You need to have an idea of what you want to start buying for resale, and it should be something you have some knowledge of or something you can study before buying. I started with comic books and collectibles, but as I went to more auctions, my niche grew and I tried different categories, with varying levels of success. This niche will NOT be your life, but you should start with something.
- Reseller’s permit. Typically, this is free to get, you go to your State Board of Equalization and tell them you want to resell goods. This way, when you buy stuff at auction, you provide your reseller’s permit and avoid paying sales tax on the purchase. Trust me, this will add up, plus a reseller’s permit makes you more serious in the auctioneer’s eyes, and that’ll matter later. (I’ll discuss this later on.)
- Access to capital, specifically liquid cash. You can start with $100, $1000, $100,000, or any number in between. I think my first auction purchase years ago was a $10 lot of coins I later resold for $175. The key here is to be able to access cash. While some auction companies take credit cards, cash is still king in the auction business, and since a lot of auctions happen on the weekends when banks are closed and ATMs limit you per day, you may want to have some cash ready to go.
- Access to a truck and storage space. One of the reasons auctions are still popular is that payment is immediate and the goods have to be cleared out within 1-3 days of the sale. If you’ve ever sold goods online, you will know that this is not always the case with online sales. When you buy at auction, you will be expected to pay and haul it away; sometimes the same day, most times you have a 1-3 day grace period. Now, depending on what you buy, your car and house may be sufficient (let’s say you specialize in trading cards, small electronics, or rolled up lithographs.) but you may need access to a truck on occasion, and storage space to handle larger goods, like furniture, antiques, large electronics, or that large collection you got at a fantastic price.
- Time. You will need to spend time before the auction, doing research and planning and having an idea of your available cash or resources. You will need to spend time at the auction, inspecting goods and placing bids for items. You will need to spend time after the auction, to come back, haul away the goods, store them somewhere and get them ready for resale. For each auction you want to attend, I’d expect to spend 4-8 hours total. As you get a few “regular auctions” under your belt, your time per week will go down, which should allow you to attend more auctions.
Besides walking into an auction and bidding on something blind, without any inspection or research, these are the other pitfalls to keep in mind:
- You may attend an auction and buy ZERO items! People who invest some time may feel like they have to buy something to justify the 2-3 hours they spent at the auction and will bid on anything. It is better to observe the bids and spend $0, than to invest money you have to spend time and effort to recoup at a loss.
- If multiple people are bidding on something, it’s a great deal no matter the final price. Wrong! Many people get caught up in auction fever, where the excitement and competitiveness of bidding make people forget what a reasonable price is and they bid to win, thinking that if the other person is bidding, it’s still a value. Years ago at a police auction, I saw someone bid close to $100 for a used VCR, where they could spend less to buy a NEW one at Target! Also, you may be up against collectors, who are buying something for themselves and can pay more. You are buying for resale, so there has to be a margin when you try to resell it.
- Forgetting about extra fees. Most auctions charge something called a “Buyer’s Premium”, which is typically 10-15% of your bid. The auction house collects this for the service of reselling the goods in their place. Many people don’t factor the buyer’s premium into their bidding and end up overpaying when everything is included.
If this interests you, the first step is to identify the auctions in your area. I start with the local newspaper’s classified ads section on a Sunday, and there is usually an auctions section near the Merchandise. Pay attention for a few weeks in a row, and you should notice a pattern. (Of course, do a Google search for auctions plus your city name, or add in the types of items you want to buy, like furniture or electronics) These are the three main types of local auctions:
- Weekly auctions. These people clean out estates, garage sales, and closed businesses every weekend, then auction off the items during the week, clear out the goods by the end of the week, and repeat the process. These can be an excellent source of products, especially if you get to know these auctioneers.
- Monthly/quarterly auctions. Some auctioneers hold auctions either every month or every quarter when they have enough goods from local collectors that they have received to be sold. Almost all of these auctions have a website, so get on their mailing lists and let them notify you when they are about to have another sale.
- Government auctions. Whether it’s the local police, state government, or federal DEA, most government agencies have to auction off goods they no longer can hold, and that can range from bicycles to flat-screen TV to Randy Cunningham’s $5,000 toilet seat. These happen every 3-6 months, and every agency sets its own place and time. Do a Google search for government auctions, police auctions, and similar terms.
The best thing you can do is use the Web as much as possible before you walk through the door. Almost every auction company has a website, so try to download the auction catalog in advance. Some sites just put up pictures, so try to decipher whatever you can from those pictures. With that information, go to eBay, Craigslist, Amazon, whatever, and figure out a range of prices for what those items sell for. Take that range with you to the auction so you know what to spend.
What to Do at the Auction
The next best thing you can do is attend the auction preview. By law, the auction company has to allow people to preview the goods. In some cases, it’s the hour before the auction starts. Other companies have the preview the day before or the morning of the event. Go to that preview, pick up the items, look for scratches, dents, malfunctioning equipment, missing items in the lot, and the overall condition of the item. Ask to plug in any electronics and test all the major functions (on/off, volume, play, stop, etc.) as the previews are supposed to have auction staff present.
The hidden gem in many local auctions is the box lots, where the companies just throw a lot of stuff into boxes and sell them a box (or group) at a time. The quick way to value these is to identify the most valuable item in the box and bid like you are only buying that item. I saw a box with a shrink-wrapped Iomega Zip drive go for $10. I assure you, the drive alone was worth more than that. Some people skip the box lots, and that is up to you.
Ever since I found a Bose Wave Radio for $75 and flipped it for $411, I try not to skip the box lots anymore. If you get to the auction after the preview is over, you can still go through the Box lots as people are bidding, but it’s pretty crazy then, and you may miss something or get caught up and overbid. While there is gold in these lots, most of it is stuff you will have to sell for salvage or donate to someone else.
Register for the auction as soon as you can, so you can spend time identifying stuff and not filling out paperwork. Bring your ID, a pen or pencil, a reseller’s permit, and cash, as some auctions require a cash or credit deposit before you get your auction number. Hopefully, with your number, you’ll get a list of items for sale. Keep this paper!
Tip: Bring some Post-It notes, and put your auction number on the note. Use that note to reserve a chair in the main bidding area. Once you do that, you can take advantage of the preview and guarantee a good seat when the bidding starts.
Once the bidding starts, write down all the final bids on your list of items, whether you win the item or not. Obviously, keep a separate tally for items you won, so you know how much of your budget you have left. You only have to do this for item categories you are interested in, so you can see later if this is an auction where people typically overbid or underbid.
As the bidding goes on, you should notice how certain people bid, whether they are upfront or wait for the “going, going” call to throw up a last-minute bid. Typically, about 5-10% of the audience places 80-90% of the bids. You’ll see a few wholesalers who buy anything that’s cheap, specialists who only bid on 1 or 2 niches, newcomers who bid on anything, and observers who wait for that certain lot. Don’t be afraid to make friends in the audience, especially if someone bought a huge lot and you want a part of it. I’ve gotten a lot of business cards for lots I bought where someone wanted a particular piece. Be warned, though, these people only want the best stuff in the lot, typically, and want to leave you with the garbage. Never make a deal on the spot. Take their card; tell them you’ll see what you can do.
In another article, we’ll talk about the resale part, where you can sell on eBay, Amazon, Craigslist, or your own website. Auctions can be fun, and when done right, can provide a steady income.
To learn more about my good friend and fellow eBay Guru Joel Elad, please visit his blog at http://www.trendgrinder.com/
We are looking for your eBay success stories to share with our ezine readers and possibly make it into a book of our reader’s best eBay stories.
A big thanks to everyone who has already submitted a story! We are looking for more great stories of your eBay adventures. We know there are many great tales out there, so please submit your story along the lines of the stories from the 100 Best Books and a great side story with photos will help. If we use your story, you will receive a $35 merchandise credit on my website and you will have your story featured–along with your user ID–in my ezine! It may also eventually end up in a published book!
By the way, when I mention my ezine readers’ user IDs with links to their auctions–it actually helps their sales! Amazing how that works. Click here for the guidelines for submitting your stories.
eBay PowerSeller and third-generation antique dealer, Lynn Dralle, is the creator of Boot Camp in a Box, the home-study course where you can learn to implement the Dralle Method to maximize your eBay profits.
If you liked today’s issue, you’ll love this step-by-step course that is guaranteed to be the most complete and enjoyable guide to selling on eBay that MAKES YOU MONEY.
Read all about it here.
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Lynn is an experienced eBay Power Seller, author, and teacher. If you want to know the eBay tips, tricks, and tools that Lynn uses for buying and selling at an online auction click here.