Starting an eBay Business Second Edition by Barbara Weltman and Malcolm Katt A member of Penguin Group (USA) Inc Starting an eBay Business Second Edition by Barbara Weltman and Malcolm Katt A member of Penguin Group (USA) Inc This book is dedicated to all the eBay sellers, present and future, who prove that the entrepreneurial spirit is indomitable ALPHA BOOKS Published by the Penguin Group Penguin Group (USA) Inc., 375 Hudson Street, New York, New York 10014, USA Penguin Group (Canada), 90 Eglinton Avenue East, Suite 700, Toronto, Ontario M4P 2Y3, Canada (a division of Pearson Penguin Canada Inc.) Penguin Books Ltd, 80 Strand, London WC2R 0RL, England Penguin Ireland, 25 St Stephen’s Green, Dublin 2, Ireland (a division of Penguin Books Ltd.) Penguin Group (Australia), 250 Camberwell Road, Camberwell, Victoria 3124, Australia (a division of Pearson Australia Group Pty Ltd.) Penguin Books India Pvt Ltd., 11 Community Centre, Panchsheel Park, New Delhi—110 017, India Penguin Group (NZ), 67 Apollo Drive, Rosedale, North Shore, Auckland 1311, New Zealand (a division of Pearson New Zealand Ltd.) Penguin Books (South Africa) (Pty.) Ltd, 24 Sturdee Avenue, Rosebank, Johannesburg 2196, South Africa Penguin Books Ltd., Registered Offices: 80 Strand, London WC2R 0RL, England Copyright © 2008 by Barbara Weltman and Malcolm Katt All rights reserved No part of this book shall be reproduced, stored in a retrieval system, or transmitted by any means, electronic, mechanical, photocopying, recording, or otherwise, without written permission from the publisher No patent liability is assumed with respect to the use of the information contained herein Although every precaution has been taken in the preparation of this book, the publisher and authors assume no responsibility for errors or omissions Neither is any liability assumed for damages resulting from the use of information contained herein For information, address Alpha Books, 800 East 96th Street, Indianapolis, IN 46240 THE COMPLETE IDIOT’S GUIDE TO and Design are registered trademarks of Penguin Group (USA) Inc International Standard Book Number: 1-4362-1243-X Library of Congress Catalog Card Number: 2007935862 Interpretation of the printing code: The rightmost number of the first series of numbers is the year of the book’s printing; the rightmost number of the second series of numbers is the number of the book’s printing For example, a printing code of 08-1 shows that the first printing occurred in 2008 Note: This publication contains the opinions and ideas of its authors It is intended to provide helpful and informative material on the subject matter covered It is sold with the understanding that the authors and publisher are not engaged in rendering professional services in the book If the reader requires personal assistance or advice, a competent professional should be consulted The authors and publisher specifically disclaim any responsibility for any liability, loss, or risk, personal or otherwise, which is incurred as a consequence, directly or indirectly, of the use and application of any of the contents of this book For details, write: Special Markets, Alpha Books, 375 Hudson Street, New York, NY 10014 Publisher: Marie Butler-Knight Editorial Director: Mike Sanders Managing Editor: Billy Fields Acquisitions Editor: Michele Wells Development Editor: Julie Bess Production Editor: Megan Douglass Copy Editor: Ross Patty Cartoonist: Steve Barr Book Designer: Trina Wurst Indexer: Brad Herriman Layout: Brian Massey Proofreader: Aaron Black Contents at a Glance Part 1: There’s No Business Like eBay Business Why Start an eBay Business? See why the eBay culture presents such great opportunities Barebones Startup Set up your space and get connected so you’re good to go 17 The ABCs of eBay Register to sell and learn the basics of a sale, from start to finish 27 Part 2: Your Stock in Trade 49 Deciding What to Sell Choose what you’ll sell by doing market research and exploring your options 51 Valuing Your Items Price your items right to attract sellers and make money 59 Where to Find Inventory Explore your sourcing options 69 Part 3: Making It Work 81 Running Auctions Learn how to make your listings effective and manage multiple sales simultaneously 83 Getting Paid Use PayPal and other payment methods to collect your money 101 Packing and Shipping Handle your shipping responsibility easily and efficiently 119 10 Marketing Miracles Use ads and promotions to expand your eBay audience 131 11 International Sales Go global with as little hassle as possible 145 Part 4: So Now Your eBay Business Is Growing! 12 Keeping Books, Records, and Inventory Keep count and your paperwork to know how you’re doing 155 157 13 Keeping It Legal Get your business licenses and tax IDs, learn about eBay policies, and decide when and how to expand your business 173 14 Protecting Your eBay Business from Fraud Learn to spot fraud, and what you can about it 187 15 Preparing for Catastrophe Plan for the worst while hoping for the best 201 16 Cutting in Uncle Sam: Taxes Pay as little taxes as required by taking advantage of tax write-offs 213 Part 5: Taking Your eBay Business to the Next Level 231 17 Power Up to PowerSeller Status How to become a PowerSeller, and benefit from being all that you can be 233 18 Multi-Channel Selling Using eBay stores and other venues to boost sales activity 243 19 Taking on Help Hire help so you can grow your business 257 20 Using Auction-Management Tools Save time and money by using eBay and third-party tools 269 21 Raising Money to Grow Your Business Borrow or take in partners to get money needed for business growth 279 22 Social Commerce: Learning, Growing, and Staying Connected 289 Stay up on eBay and business developments and opportunities Appendixes A eBay and Third-Party Tools 301 B eBay Icons 321 Index 323 Contents Part 1: There’s No Business Like eBay Business Why Start an eBay Business? Becoming an Instant Millionaire Takes Time eBay Businesses Are Like No Other Businesses Used Versus New Items Moving from a Hobby to a Real Business Being a Part-Time Seller .8 Finding a Space in the Crowd on eBay Making eBay Your Full-Time Business Achieving PowerSeller Status 10 Financial Considerations 11 Setting Up Your Business 11 Working from Home 11 Don’t Quit Your Day Job too Soon 12 Selling for Others 13 Buying a Packaged eBay Business 14 Don’t Go There 16 Barebones Startup 17 Space in Your Home 17 Finding a Place for Your Computer and Inventory 18 Exploring Space-Saving Strategies 19 Have Any Connections? .20 Phone Lines .20 Internet Connections 21 Tools of the Trade 22 Desktop or Laptop? 23 Picture This 24 Other Useful Business Items 25 The ABCs of eBay 27 Enlisting in eBay 28 Registering to Buy and Sell 28 What’s in a Name? 29 Completing the Registration Process 31 Creating Multiple Accounts 32 Using My eBay 32 vi The Complete Idiot’s Guide to Starting an eBay Business, Second Edition From Listing to Selling 34 Listing Your Products 34 Maximizing Browsing Factors 37 The Auction Process 38 Going, Going, Gone 39 Auction Alternatives 39 The Sell Your Item Form 40 eBay Fees 43 Auction Management 45 Post-Sale Management 46 Contacting the Winning Bidder 46 Arranging Payment 47 Packing and Shipping Your Items 47 Soliciting Feedback .48 Part 2: Your Stock in Trade 49 Deciding What to Sell 51 What Should You Sell? 51 Item Restrictions 52 Finding Your Fit—Finds and Fads .54 Experiment with Different Items 55 Selling Leftover Inventory from Another Business 56 Being a Reseller 56 Finding Selling Opportunities on eBay 56 Researching What’s Hot, Hot, Hot! 57 Valuing Your Items 59 Putting a Price on Your Items 59 How Low (or High) Can You Go? 61 What’s the Break-Even Point? 61 Determining the Value for Your New Merchandise 62 Valuing Collectibles and Antiques .64 The Past Is Prologue—Using Past eBay Auctions 65 Price Lists and Guide Books .66 More Ways to Set Prices .67 Where to Find Inventory 69 Buying New Merchandise to Resell 70 Neighborhood Resources 70 Online Resources for Deals and Steals 71 Contents Finding Inventory on eBay 72 Wholesale Lots 72 Misspelled Items 73 Slow Weeks on eBay 74 Someone’s Trash Is Another’s Treasure 75 Estate Sales 75 Flea Markets 76 Garage and Yard Sales 76 Thrift Stores, Consignment Stores, and Pawnshops 76 Government Auctions 77 Buying Right 78 The Drop Shipping Alternative 78 Finding Drop Shippers 79 Handling Drop Shipper Problems 80 Part 3: Making It Work 81 Running Auctions 83 Optimizing Your Auctions to Make More 83 Creating a Better Listing 84 Using eBay Auction Enhancements 87 Should You Use Listing Enhancements? .89 Other Listing-Enhancement Tools 91 Say It with Pictures .92 Getting Better Images 93 Storing Your Images 95 Auction Strategies 95 Setting a Reserve 96 “Buy It Now” 96 Relisting 97 Second-Chance Sales 98 Managing Multiple Auctions 98 Choosing Your Bidders .100 Getting Paid 101 Arranging Payments in Advance 102 Don’t Ship Before Collecting 102 Building Relationships with Customers 103 Paper or Plastic? 103 Checks and Money Orders 104 Plastic Is a Plus for Your Business 104 vii viii The Complete Idiot’s Guide to Starting an eBay Business, Second Edition You Have a Friend in PayPal 105 Registering with PayPal 106 Gauging the Cost of Using PayPal 108 Making the Most of Your PayPal Account 108 Offering PayPal Buyer Protection 110 Offering PayPal Buyer Financing 111 Alternative Online Payment Options 111 Using an Escrow Service 112 Using a Bonding Service 113 Banking on a Business Bank Account 114 Keeping Everything Separate 114 Building Business Credit 115 Nonpayment Recourse 115 eBay Recourse 115 Legal Action 116 Government Action 117 Packing and Shipping 119 Buyer’s Burden 120 Clarifying the Price Plus Shipping 121 Negotiating with the Buyer 122 Packing Things Yourself or Using Assistance 122 Boxes, Bubble Wrap, and More 123 Packing Solutions 124 Shipping Calculators 124 Post Office Options 124 USPS.com 125 Your Post Office Mailing Alternatives 125 More Mailing Options 127 UPS 127 FedEx 128 Other Carriers 128 Skip Shipping Things Yourself 129 Claims for Undelivered or Damaged Items 130 10 Marketing Miracles 131 Creating a Marketing Plan 132 A Separate but Equal Website 133 Setting Up Your Own Site 134 Tying Your Website to eBay 134 Generating Website Traffic 135 eBay and Third-Party Tools 319 u DHL (www.dhl.com) Drop off or arrange for pickup Cost: varies u DSI (www.dsiinsurance.com and click on Auction Sellers and Buyers) This fullservice shipping company boasts the lowest insurance rates (promising savings of up to 90 percent on shipping insurance) Cost: varies u FedEx (www.fedex.com) Ship at your local Kinko’s, from 46,000 drop-off locations, or request a pick up from your location Cost: varies u UPS (www.ups.com) Ship at your UPS store or request a pickup from your location Cost: varies u U.S Postal Service (www.usps.com) Ship at your local post office or request a pick up from your location Cost: varies u Yellow (www.myyellow.com) Use this small carrier when shipping specialized goods, such as temperature-sensitive items Cost: varies Taxes Burdensome as it may be, use online tools to make things easier u ADP (www.adp.com) Outsource employment tax filings to this payroll company u Business Owners Toolkit (www.toolkit.com) Link to your state for forms u EIN (http://sa1.www4.irs.gov/sa_vign/newFormSS4.do) Obtain your employer tax identification number (your federal business ID) online Cost: free u IRS (www.irs.gov) Obtain forms and schedules online u PayChex (www.paychex.com) Outsource employment tax filings to this payroll company u The Sales Tax Clearinghouse (http://thestc.com/STrates.stm) Find information and rates on your state’s sales tax B Appendix eBay Icons eBay listings are peppered with icons conveying a lot of information for those who can decipher the little pictures Here’s a glossary of eBay icons Appendix B eBay icons 322 Index Numbers accounts account takeovers, 192 accounts receivable 3cim, 276 statements, 160 10‑day duration option, business banking accounts, listings, 88 114‑115 401(k) plans, accessing, 282 creating multiple, 32 800 telephone numbers, eBay Trading Assistant, 14 obtaining, 20 hacks, protecting against, 197‑198 opening, 28‑34 AARP (Association of passwords, forgetting, 31 American Retired People), PayPal accident insurance, 212 linking to, 32 accounting, 171 optimizing, 108‑111 accounts receivable takeovers, protecting statements, 160 against, 196‑197 accrual method accounting, accrual method accounting, 164‑165 164‑165 balance sheets, 160 ACE USA, 113 break‑even points, 171 Auctiva, 276 cash method accounting, 164 Adobe Photoshop, 25, 276 charts of accounts, 160 Advanta credit cards, 287 financial reporting, 159‑160 advertising, 132‑139 general ledgers, 160 About Me pages, 137‑138 gross profit margins, 158 free advertising, 138 gross profits, 158 paid advertising, 138‑139 income statements, 160 affiliate program, 136, 253‑254 inventories, 165‑168 affiliates, enlisting, 136 inventory listings, 160 American Society of methods, 164‑165 Appraisers, 68 net profit margins, 172 anchor eBay stores, 247 operating profit margins, 171 Answer Center, 272, 297 paper journals, 161‑162 Antique Appraisals Online, 68 progress, tracking, 158 antiques, pricing, 64 receipts, saving, 168‑171 antispam rules, 141 software, 162‑163 appraisers, hiring, 68 systems, setting up, 160‑161 arranging payments, 47, 102‑103 tax responsibilities, 159 checks, 104 credit cards, 104‑105 A debit cards, 104‑105 money orders, 104 PayPal, 105‑111 ASD/AMD, 71 attorneys, hiring, 260 Auction Checkout, 278 auctioneer licenses, 175 Auctionpix, 95 auctions auction‑management tools, 269‑278 best days, 39 bidders, choosing, 100 Buy It Now auctions, 40, 96‑97 choosing, 37 durations, 39 Dutch auctions, 39 eBay stores, compared, 245‑246 featured auctions, 37 feedback, soliciting, 48 fees, 43‑44 government auctions, purchasing merchandise from, 77 keywords, 84‑85 listings See listings live auctions, conducting, 251‑253 managing, 45 multiple auctions, managing, 98‑99 payments See payments post‑sell management, 46‑47 process, 38‑44 relisting, 97 reserve prices, 33 reserves, setting, 96 rules, 181‑182 324 The Complete Idiot’s Guide to Starting an eBay Business, Second Edition second‑chance sales, 98 strategies, 95‑98 winning bidders, contacting, 46‑47 automobiles, expenses, tax deductions, 226 blue star feedback rank, 190 boilerplate terms, payments and shipping, 86 bold type, listings, 87 Boldchat, 277 listings, 91 bonding services, employing, 113‑114 bookkeeping See accounting background materials, digital borders, listings, 87 cameras, 25 borrowing capital, 280‑284 backing up computer files, 210 boxes, packaging, 123‑124 bad buyers, protecting against, brands, creating, 133 188‑189 break‑even points, 61‑62, 171 balance sheets, 160 brokers, Customs brokers, 150 bank accounts, transferring Bronze PowerSellers, 10, funds to, PayPal, 109 236‑237 basic eBay stores, 247 Browse feature, maximizing, Basic Picture Services, 95 37‑38 BayMail, 277 bubble wrap, packaging, 123‑124 BBB Online, listings, 92 building Best Offer option, Buy It Now business credit, 115 auctions, 40 relationships, customers, 103 bidders bulk mailings, tools, 277 blocking, 100, 116, 192‑193 business bank accounts, choosing, 100 opening, 114‑115 nonpaying bidders, relief business credit, building, 115 from, 198‑199 business disruption insurance, relationships, building, 103 202‑204 tracking, 142‑144 business earnings, reinvesting, winning bidders, contacting, 288 46‑47 business licenses, 173‑174 BidPay, 104 cost, 175 bids importance of, 174‑175 bid shielding, 188 obtaining, 175 bid siphoning, 188 partnerships, 174 nonpayment, 189 sole proprietorship, 174 BJs, purchasing inventory from, business owner’s policies 71 (BOPs), 206 Blackthorne Basic, 99, 270 business status (taxes), 214‑217 Blackthorne Pro, 99, 270 buyer financing, PayPal, blocking bidders, 100, 116, offering, 111 192‑193 Buyer Protection, PayPal, blogs (eBay), 297 offering, 110‑111 marketing on, 139‑140 B buyers blocking, 116, 192‑193 feedback, 4, 188 soliciting from, 48 system, 189‑191 negative feedback, entering on, 115 overseas buyers, 146 currencies, 146 Customs, 147‑150 documents, 148 fraud, 150‑152 payments, 147 shipping, 152‑154 positive feedback, soliciting, 143‑144 registering, 28‑34 relationships, building, 103 S&H (shipping & handling), 120‑122 calculating, 124 negotiating, 122 packaging, 122‑124 shipping insurance, shifting to, 208‑209 tracking, 142‑144 Buy It Now auctions, 40, 87, 96‑97 Best Offer option, 40 setting, 60 buySAFE bonding service, 113‑114 C C corporations, 184 calculating shipping costs, 124 cameras (digital), 6, 24‑25 CAN‑SPAM Act of 2003, 141 capital borrowing, 280‑284 eBay businesses, raising, 279‑286 capturing images, 93 cars, expenses, tax deductions, 226 Index 325 cash method accounting, 164 catastrophes, protecting against, 209‑212 categories, PowerSellers, 10 category‑specific discussion boards, 295 Certified Business Consultants, becoming, 291 Certified eBay Education Specialists, becoming, 291 chargebacks, 105‑106 charts of accounts, 160 chat rooms, 140, 296 eBay chat rooms, marketing on, 139‑140 check disbursement journals, 161 checks accepting, 104 holding periods, 104 receiving, PayPal, 109 verifying, 104 choosing merchandise, 51‑56 claims damaged items, 130 undelivered items, 130 closeouts, purchasing, 70 collectible interest eBay groups, 297 collectibles, pricing, 64 collecting payments, 101 color star system (feedback), 190 commercial loans, obtaining, 283‑284 comprehensive policies (insurance), 206 computer files, backing up, 210 consignment stores, purchasing merchandise from, 76‑77 Consumer Electronics Association, 24 consumer protection law, New York, 86 contacting winning bidders, 46‑47 contesting negative feedback, 144 contractors, hiring, 266‑268 conventions (eBay), 299‑300 co‑owners, taking on, 258‑260 corporations, 259 C corporations, 184 forming, 182‑186 LLCs, compared, 183‑184 S corporations, 184 taxes, rules, 184 cost method, inventory valuing, 168 Costco, purchasing inventory from, 71 costs business licenses, 175 operational costs, 183 organizational costs, 183 PayPal, gauging, 108 shipping costs, calculating, 124 tax costs, 184 counters, 274‑275 Craigslist, 63, 76, 256 credibility, establishing, 133 credit, business, building, 115 credit cards accepting, 104‑105 Advanta, 287 CapitalOne Visa Business Platinum Cards, 287 chargebacks, 105‑106 Chase Business Cards, 287 eBay MasterCards, 287 financing by, 286‑288 Open from American Express, 288 PayPal Plus Credit Card, 288 per‑transaction charges, 105 cross‑selling, 255 currencies, overseas customers, 146 customers management tools, 277 overseas customers, 146 currencies, 146 Customs, 147‑150 documents, 148 fraud, 150‑152 payments, 147 shipping, 152‑154 positive feedback, soliciting, 143‑144 relationships, building, 103 support, 272 tracking, 142‑144 Customs, international sales, 147‑150 Customs brokers, 150 cyberliability coverage, 212 D damaged items, claims, 130 data reconstruction insurance, 202‑204 DBA (doing business as), 174 debit cards accepting, 104‑105 chargebacks, 105‑106 PayPal, 109 per‑transaction charges, 105 deductibles, insurance, 207 deductions See taxes Department of Justice, 117 deposited checks, holding periods, 104 depreciation, tax deductions, 222‑224 describing products, 35 D‑Flector (SharPics), 25 DHL international shipping, 153‑154 shipping with, 128 digital subscriber line (DSL) Internet connections, 21 Disabled Online Users Association (DOUA), 297 disasters, protecting against, 209‑212 discount clubs, purchasing inventory from, 71 326 The Complete Idiot’s Guide to Starting an eBay Business, Second Edition discussion boards, 140, 295‑296 category‑specific discussion boards, 295 community help boards, 295 eBay Giving Works discussion boards, 295 eBay Tools boards, 295 general discussion boards, 295 marketing on, 139‑140 PowerSellers, 240 display formats, images, 94 disruptions, insuring against, 202 documents, exporting, 148‑149 DOUA (Disabled Online Users Association), 297 drop shipping, 16, 47, 78‑80, 129 DSI, shipping with, 129 DSL (digital subscriber line) Internet connections, 21 Dutch auctions, 39 Radio, 298 Selling Manager, 143 shipping calculator, 124 to Go, 256 Tools boards, 295 Trading Assistant, 14 University, 241, 290 courses, taking, 291‑292 ed2go, 290 Education Specialists, becoming, 291 EFTPS (Electronic Federal Tax Payment System), 264 eHarbors, 273 EINs (employer identification numbers), 114, 178‑179 Electronic Federal Tax Payment System (EFTPS), 264 e‑mail messages, PayPal, responding, 106 embedded videos, adding, 36 employees disability insurance, 205 family members, 263 earnings, reinvesting, 288 hiring, 260‑266 eAuctionDepot, 15 interviews, 262 eBay job descriptions, 262 affiliate program, 136, keeping happy, 266 253‑254 references, checking, 262 Answer Center, 272, 297 searching for, 262 blogs, marketing on, 139‑140 tax filing responsibilities, chat rooms, marketing on, 265‑266 139‑140 unemployment insurance, conventions, 299‑300 205 discussion boards workers compensation Giving Works, 295 insurance, 204‑205 marketing on, 139‑140 employer identification Education Specialists, numbers (EINs), 114, 178‑179 becoming, 291 employment taxes, 219‑220 Express, 256 Enhanced Picture Services, 95 Live!, 241, 299 enhancing images, 94 MasterCard, 287 enlisting affiliates, 136 Picture Manager, 95 entering negative feedback, 115 Picture Services, 95 entertainment expenses, tax PowerSeller Challenge, 241 deductions, 227‑228 E equipment expenses, tax deductions, 228‑229 equity, 281 escrow services employing, 112‑113 fake escrow services, 192 international transactions, 151‑152 establishing credibility, 133 estate sells, purchasing merchandise from, 75 expertise, publicizing, 142 exporting documents, 148 Express Mail, 126 Express Mail International, 153 F FAQs (Frequently Asked Questions), setting up, 45 featured auctions, 37 Featured Plus! option, listings, 87 federal income taxes, 218‑219 Federal Trade Commission, 117, 200 scams, reporting to, 15 FedEx international shipping, 153‑154 shipping with, 123‑128 FedEx Kinkos, 124 feedback, 4, 188 negative, contesting, 144, 199 positive, soliciting, 48, 143‑144 system, 189‑191 FeeFinder, 278 fees auctions, 43‑44 Final Value Fees, 44 Insertion fees, 43 eBay stores, 247‑249 Store Referral Credits, 249 FFP Global, 19 Index 327 FIFO (first in, first out), inventories, 167 figuring inventories, 165‑166 File Exchange, 99 files, backing up, 210 filling gaps, insurance, 211‑212 Final Value Fee (FVF) credit, requesting, 116 Final Value Fees, auctions, 44 financial considerations, eBay businesses, 11 financial reporting, 159‑160 financing credit cards, 286‑288 offering, PayPal, 111 sources, 280‑284 Fios Internet connections, 21 firewalls, installing, 197 first class shipping, 126 flea markets, purchasing merchandise from, 76 flood insurance, 212 fraud, international sales, 150‑152 fraud protection, 200 account hacks, 197‑198 account takeovers, 196‑197 bidders, blocking, 192‑193 big‑time fraud, 193‑198 business identity theft, 194‑195 eBay resources, 198‑200 PayPal, 105 seller‑focused scams, 191‑192 small‑time fraud, 188‑192 bad buyers, 188‑189 feedback system, 189‑191 free advertising, 138 freelancers, hiring, 266‑268 fulfillment companies, 19, 47 shipping with, 129 FVF (Final Value Fee) credit, requesting, 116 G galleries, listings, 87, 93 Gallery featured option, listings, 87 Gallery plus option, listings, 87 garage sales, purchasing merchandise from, 76 general pack radio service (GPRS), 210 gift certificates, marketing through, 141‑142 Gift services option, listings, 87 Giving Works discussion board, 295 Global Express Guaranteed (GXG), 153 Gold PowerSellers, 10, 236‑237 Good ’Til Cancelled (GTC), 248 Google, 136 government action, nonpaying customers, taking against, 117 government auctions, purchasing merchandise from, 77 government surplus, purchasing, 70 GPRS (general pack radio service), 210 graphics adding, 36 capturing, 93 display formats, 94 enhancing, 94, 276 listings, 92‑95 galleries, 93 resolution, 93 storing, 95 gross profit margins, 158, 171 group summits, 300 groups (eBay), 296‑297 GTC (Good ’Til Cancelled), 248 Guardian disability insurance, 204 GXG (Global Express Guaranteed), 153 H hacks (accounts), protecting against, 197‑198 handling charges, 119‑122 calculating, 124 negotiating, 122 packaging, 122‑124 health care, PowerSellers, 240 health insurance, 212 help boards, 295 help pages (eBay), 271‑272 hiring appraisers, 68 attorneys, 260 employees, 260‑266 independent contractors, 266‑268 hobby status (taxes), 214‑216 holding periods, deposited checks, 104 homeowner’s policies, 206 Home page featured option, listings, 87 homes, equity, 281 HTML (Hypertext Markup Language), 34 I identity theft, business, protecting against, 194‑195 iloxx Safe Trade, 152 images adding, 36 capturing, 93 display formats, 94 enhancing, 94, 276 listings, 92‑95 galleries, 93 resolution, 93 storing, 95 income statements, 160 328 The Complete Idiot’s Guide to Starting an eBay Business, Second Edition income taxes, 218‑219 incorporating Delaware, 185 eBay businesses, 182‑186 Nevada, 185 independent contractors, hiring, 266‑268 Insertion fees, auctions, 43 installing firewalls, 197 Institute for Business and Home Safety, 211 insurance, 205 accident insurance, 212 business disruption insurance, 202‑204 comprehensive policies, 206 coverages, 202, 212 data reconstruction insurance, 202‑204 deductibles, 207 disability insurance, 205 flood insurance, 212 gaps, filling in, 211‑212 health insurance, 212 homeowner’s policies, 206 liability insurance, 202‑203 property insurance, 202‑203 purchasing, 207 riders, 206 shipping, 120 shipping insurance, 207‑209 unemployment insurance, 205 unpaid item insurance, 10 workers compensation insurance, 204‑205 insurance rates, post office mailings, 126 international customers, 146 currencies, 146 Customs, 147‑150 documents, 148 fraud, 150‑152 payments, 147 shipping, 152‑154 international scams, avoiding, 192 International Society of Appraisers, 68 Internet connections, 6, 21‑22 wireless Internet access, 210 Internet Tax Nondiscrimination Act, 176 InterNIC, 134 Interpol, 150 interviews, prospective employees, 262 Intuit QuickBooks Pro, 163 inventories, 158 FIFO (first in, first out), 167 figuring, 165‑166 fulfillment companies, 19 inventory listings, 160 LIFO (last in, first out), 167 paperwork accounting methods, 164‑165 importance of, 158‑160 paper journals, 161‑162 setting up, 160‑163 software, 162‑163 purchasing for resell, 70‑78 receipts, saving, 168‑171 storing, 18‑19 tracking, 165‑168 valuing, 167‑168 inventory listings, 160 investors, taking in, 284‑286 IRAs (Individual Retirement Accounts), accessing, 282 IRS Publication 334, Tax Guide for Small Business, 230 IRS Publication 535, Business Expenses, 230 item subtitles, listings, 88 J–K job descriptions, prospective employees, 262 job postings, fake, 192 keywords, listings, 84‑85 L landlines, 20‑21 lawyers, hiring, 260 leftover inventories, selling, 56 legal actions, nonpaying customers, taking against, 116‑117 liability insurance, 202‑203 licenses auctioneer, 175 business, 173‑174 cost, 175 importance of, 174‑175 obtaining, 175 partnerships, 174 sole proprietorship, 174 sales tax numbers, 176‑177 life insurance policies, cashing in, 282 LIFO (last in, first out), inventories, 167 List in two categories option, 88 listing products, 34‑38 Listing designer option, 88 listing fee upgrades, recovering, 116 listings 10‑day duration option, 88 AuctionVideo option, 91 BBB Online, 92 bidders, choosing, 100 bold type, 87 Boldchat option, 91 borders, 87 Buy It Now feature, 87, 96‑97 creating, 83‑92 enhancing, tools, 276‑277 Featured Plus! option, 87 galleries, 87 Gallery featured option, 87 Gallery plus option, 87 Gift services option, 87 highlights, 87 Home page featured option, 87 item subtitles, 88 Index 329 keywords, 84‑85 Listing designer option, 88 List in two categories option, 88 losing, 53 multiple listings, managing, 98‑99 pictures, 92‑95 capturing, 93 display formats, 94 enhancing, 94 galleries, 93 resolution, 93 storing, 95 preferred listings, 254 relisting, 97 reserves, setting, 96 rules, 181‑182 Schedule listings option, 88 second‑chance sales, 98 Skype option, 92 spelling, importance of, 85 SquareTrade, 92 strategies, 95‑98 terms of sale, 102‑103 titles, creating, 84 Turbo Lister, 270 VeriSign, 92 Vhost SitePal, 92 live auctions, conducting, 251‑253 Live Help, 272 LLCs (limited liability corporations), 259 corporations, compared, 183‑184 forming, 182‑186 taxes, rules, 184 loans commercial loans, 283‑284 microloans, 283 obtaining, 280‑284 losses, 214‑215 low‑cost marketing, 139‑142 lower of cost method, inventory valuing, 168 M money orders, accepting, 104 multi‑channel selling affiliate program, 253‑254 mailings, marketing through, cross‑selling, 255 140‑141 eBay stores, 244‑249 maintaining PowerSeller status, anchor stores, 247 238 basic stores, 247 managing fees, 247‑249 auctions, 45 opening, 246‑247 feedback, 48 premium stores, 247 post‑sell management, Store Referral Credits, 46‑47 249 multiple auctions, 98‑99 live auctions, conducting, Markdown Manager, 245 251‑253 market method, inventory preferred listings, 254 valuing, 168 Trading Assistants, marketing, 132 becoming, 250‑251 multi‑level marketing, 255 PowerSeller status, 238‑239 multi‑level marketing, 255 multiple accounts, creating, 32 marketing plans multiple auctions, managing, advertising, 136‑139 98‑99 About Me pages, 137‑138 My eBay, 32‑34 free advertising, 138 paid advertising, 138‑139 components, 132 creating, 132‑133 low‑cost marketing, 139‑142 naming businesses, 134 no‑cost marketing, 139‑142 National Federation of Independent Business (NFIB), 212 PowerSeller status, 142 national trade papers, 65 tracking customers, 142‑144 negative feedback websites, creating separate, buyers, entering, 115 133‑136 contesting, 144 MarketingPlan Pro, 132 unfounded negative marketplace, PowerSellers, 240 feedback, contesting, 199 markets, researching, 57‑58 net profit margins, 172 Marketworks, 273 Nevada, incorporating in, 185 media mail, 126 new items, selling, 6‑7 mediators, 117 news groups, PowerSellers, member IDs, creating, 29‑31 240‑241 Mercer Health & Benefits, 240 NFIB (National Federation of microloans, 283 Independent Business), 212 misspelled items, purchasing, no‑cost marketing, 139‑142 73‑74 nonpaying bidders, 189 money blocking, 116 borrowing, 280‑284 relief from, 198‑199 eBay businesses, N raising, 279‑286 330 The Complete Idiot’s Guide to Starting an eBay Business, Second Edition nonpayment recourse, 115‑117 eBay recourse, 115‑116 government action, 117 legal actions, 116‑117 NPBs (nonpaying bidders), relief from, 198‑199 packaging, 122‑124 calculating, 124 products, 47 paid advertising, 138‑139 paper journals, keeping, 161‑162 paperwork, 158 accounts receivable statements, 160 charts of accounts, 160 obtaining business licenses, 175 general ledgers, 160 ODR (online disputeimportance of, 158‑160 resolution) programs, 117 inventory listings, 160 OMSA (Orders and Medals Parcel Post, 126 Society of America), 35 partnerships, 258‑260 online auctions, conducting, 23 business licenses, 174 online courses, 290‑291 part‑time eBay businesses, 8‑9 eBay University, 291‑292 passwords, forgetting, 31 online dispute‑resolution pawnshops, purchasing (ODR) programs, 117 merchandise from, 76‑77 online payment options, 111‑112 payments, 103 online workshops, 291 arranging, 47, 102‑103 opening boilerplate terms, 86 business banking accounts, bonding services, 113‑114 114‑115 business bank accounts, eBay stores, 246‑247 114‑115 unpaid item disputes, 115 checks, 104 operating profit margins, 171 credit cards, 104‑105 operational costs, businesses, debit cards, 104‑105 183 escrow services, 112‑113 Orders and Medals Society of international customers, 147 America (OMSA), 35 money orders, 104 organizational costs, nonpayment recourse, businesses, 183 115‑117 overseas customers, 146 eBay recourse, 115‑116 currencies, 146 government action, 117 Customs, 147‑150 legal actions, 116‑117 documents, 148 online payment options, fraud, 150‑152 111‑112 payments, 147 PayPal, 105‑111 shipping, 152‑154 receiving, 101 PayPal, 104, 272 accounts linking to, 32 packaged eBay businesses, optimizing, 108‑111 purchasing, 14‑16 ATM machines, getting cash from, 110 O P bank accounts, transferring funds to, 109 buyer financing, offering, 111 Buyer Protection, offering, 110‑111 chargebacks, 105‑106 checks, receiving, 109 costs, gauging, 108 debit cards, 109 e‑mail messages, responding to, 106 fraud protection, 105 international payments, 147 payments, accepting, 105‑111 registering with, 106‑108 stores, 110 virtual cards, 110 PayPal Plus Credit Cards, 288 Peachtree software, 162‑163 perks, PowerSellers, 239‑241 personal disruption insurance, 204 personal information requests, recognizing, 198 PeSA (Professional eBay Sellers Association), 241, 300 phishing, 195 photographs, listings, 87 pictures adding, 36 capturing, 93 display formats, 94 enhancing, 94, 276 listings, 92‑95 galleries, 93 resolution, 93 storing, 95 Platinum PowerSellers, 10, 236‑237 policies, eBay, 180‑182 positive feedback, customers, soliciting, 143, 144 postage, charging, 120 PowerSeller status, 9‑10 becoming, 10, 234 benefits, 10 categories, 10 Index 331 community, 240‑241 criteria, 234‑235 designations, 236‑237 discussion boards, 240 health care, 240 listing fee upgrades, recovering, 116 marketplace, 240 news group, 240‑241 perks, 239‑241 PeSA (Professional eBay Sellers Association), 241 PowerSeller Report, The, 293 recognizing, 236 reports, 241 scams, 235 special events, 241 status maintaining, 238 marketing through, 238‑239 support services, 237 taking advantage of, 142 UIP (unpaid item protection), 240 preferred listings, 254 premium eBay stores, 247 price lists, 66‑67 prices break‑even points, 61‑62 Buy It Now feature, setting, 60 reserve prices, 33 setting, 60 starting prices, setting, 60 pricing products, 59‑68 antiques, 64 collectibles, 64 guide books, 66‑67 price lists, 66‑67 print advertising, paying for, 139 printing shipping labels, 125 Priority Mail, 126 Priority Mail International (USPS), 153 procedures, sales taxes, 177 products antiques, collectibles, 64 Browse feature, maximizing, 37‑38 choosing, 51‑56 collectibles, 64 damaged products, claims, 130 describing, 35 exporting documents, 148 listing, 34‑38 packaging, 47, 122‑124 post‑sell management, 46‑47 prices, setting, 35 purchasing to resell, 70‑78 researching, 57‑58 restrictions, 52‑54 selling opportunities, finding, 56‑58 Sell Your Item forms, 40‑42 shipping, 47 drop shipping, 78‑80 terms of sale, describing, 37 valuing, 59‑68 guide books, 66‑67 price lists, 66‑67 Professional eBay Sellers Alliance (PeSA), 300 progress, tracking, 158 prohibited products, 52‑54 promotions, 132 property insurance, 202‑203 Prospector Professional, 278 protection (fraud), 200 account hacks, 197‑198 account takeovers, 196‑197 bidders, blocking, 192‑193 big‑time fraud, 193‑198 business identity theft, 194‑195 eBay resources, 198‑200 seller‑focused scams, 191‑192 small‑time fraud, 188‑192 feedback system, 189‑191 proxies, acting as, 13‑14 publicizing expertise, 142 pyramid schemes, avoiding, 192 Q–R questionable products, 53 QuickBooks Pro, 163 raising capital, 279‑286 receipts inventory‑related receipts, 168‑169 saving, 168‑171 storing, 170‑171 tax‑related receipts, 169‑170 receiving payments, 101 records, 158 accounts receivable statements, 160 charts of accounts, 160 general ledgers, 160 importance of, 158‑160 inventory listings, 160 keeping, 23 recourse (nonpayment), 115‑117 eBay recourse, 115‑116 government action, 117 legal actions, 116‑117 recovering listing fee upgrades, 116 regional eBay groups, 297 registered trademarks, 179‑180 registering eBay businesses, 7, 28‑34 PayPal, 106‑108 regulations, eBay, 180‑182 reinvesting business earnings, 288 relisting, 97 reports, PowerSellers, 241 research tools, 273‑274 researching products, 57‑58 resell, purchasing products for, 70‑78 resellers, becoming, 56 reserve prices, 33 setting, 60, 96 restrictions, merchandise, 52‑54 retail method, inventories, 168 332 The Complete Idiot’s Guide to Starting an eBay Business, Second Edition retirement plans, accessing, 282 sell‑through rates, 57‑58 riders, insurance policies, 206 SEO (search engine optimization), websites, 136 setting Buy It Now feature, 60 S corporations, 184 prices, 35 sales, rules, 181‑182 reserve prices, 60 sales items, purchasing, 70 reserves, 96 sales taxes, 220 starting prices, 60 procedures, 177 shielding bids, 188 rules, 176‑177 shipping, 119 sales tax numbers, 176‑177 boilerplate terms, 86 Salvation Army Thrift Stores, calculators, 124 purchasing merchandise from, charges, 120‑122 77 negotiating, 122 Sam’s Club, purchasing claims, 130 inventory from, 71 collecting payment before, saving receipts, 168‑171 102 SBA (Small Business DHL, 128 Administration), 133 drop shipping, 16, 47, 78‑80, SCADS (Stamp Collectors 129 Against Dodgy Sellers), 188 managing, 80 scams DSI, 129 avoiding, 15 FedEx, 128 PowerSeller status, 235 insurance, 120, 207‑209 Schedule listings option, international shipping, listings, 88 152‑154 search engines packaging, 122‑124 placement, paying for, 136 post office options, 124‑127 SEO (search engine products, 47 optimization), 136 shipping labels, printing, 125 Search Help, 271 UPS, 127, 128 Search Options area, 63 Yellow, 129 second‑chance sales, 98 shipping labels, printing, 125 Sell Your Item forms, 40‑42 Silver PowerSellers, 10, 236‑237 seller blogs, 297 siphoning bids, 188 Seller Central, 140 Skype, 20 seller‑focused scams, 191‑192 listings, 92 sellers small‑time fraud, protecting feedback, 188‑191 against, 188‑192 PowerSellers, 9‑10 bad buyers, 188‑189 registering, 28‑34 blocking bidders, 192‑193 selling feedback system, 189‑191 cross‑selling, 255 seller‑focused scams, for others, 13‑14 191‑192 leftover inventories, 56 Small Business Administration selling groups, 297 (SBA), 133 S sniping, 275 social commerce, 294 software bookkeeping, 162‑163 digital photography, 25 sole proprietorships, business licenses, 174 special events, PowerSellers, 241 special interest eBay groups, 297 SquareTrade, 117 listings, 92 Stamp Collectors Against Dodgy Sellers (SCADS), 188 star system (feedback), 190 starting prices, setting, 60 state income taxes, 218‑219 state unemployment insurance numbers, 179 status (taxes), determining, 214‑217 Store Referral Credits, 249 stores, PayPal, 110 stores (eBay), 244‑249 anchor stores, 247 auction format, compared, 245‑246 basic stores, 247 fees, 247‑249 opening, 246‑247 premium stores, 247 Store Referral Credits, 249 storing images, 95 inventory, 18‑19 receipts, 170‑171 strategies, auctions, 95‑98 support services, PowerSellers, 237 T takeovers (accounts), protecting against, 192, 196‑197 taxes, 184, 213 corporations, rules, 184 Index 333 deductions, 224‑230 automobile deductions, 226 business deductions, 225 depreciation, 222‑224 entertainment deductions, 227‑228 equipment, 228‑229 hobbyists, 215 home office deductions, 220‑224 supplies, 228‑229 travel deductions, 227‑228 EINs (employer identification numbers), 178‑179 employer tax filing responsibilities, 265‑266 employment taxes, 219‑220 home offices, deducting, 18 income taxes, 218‑219 Internet Tax Nondiscrimination Act, 176 LLCs (limited liability companies), rules, 184 responsibilities, 159, 217‑220 sales taxes, 220 procedures, 177 rules, 176‑177 status, determining, 214‑217 tax costs, businesses, 184 tax‑related receipts, 169‑170 terms of sale (listings), 102‑103 describing, 37 Thrift Shopper, purchasing merchandise from, 77 thrift stores, purchasing merchandise from, 76‑77 Thrift Town, purchasing merchandise from, 77 thumbnail photos, listings, 87 time, eBay businesses, Titanium PowerSellers, 10, 236‑237 toll‑free telephone numbers, obtaining, 20 Tools boards, 295 trademarks, 179‑180 Trading Assistant (eBay), 14 becoming, 250‑251 transaction charges, credit cards, 105 travel expenses, tax deductions, 227‑228 TRUSTe bonding service, 114 TurboLister, 99, 270‑272 tutorials, business, eBay University, 290‑292 V verification, checks and money orders, 104 videos, adding, 36 virtual cards, PayPal, 110 W–X–Y–Z Web advertising, paying for, 139 wholesale lots, purchasing, 72‑73 Wi‑Fi technology, 18 winning bidders, contacting, 46‑47 wireless Internet access, 210 U.S mail, shipping options, workers compensation 124‑127 insurance, 204‑205 U.S Postal Inspection Service, workshops, 291 117 write‑offs, taxes, 224‑230 U.S Postal Service shipping automobile deductions, 226 calculator, 124 business deductions, 225 UIP (unpaid item protection), entertainment deductions, PowerSellers, 240 227‑228 undelivered items, claims of, 130 equipment, 228‑229 unemployment insurance, 205 supplies, 228‑229 Unpaid Item disputes, opening, travel deductions, 227‑228 115 unpaid item insurance, 10 yard sales, purchasing unpaid item protection, merchandise from, 76 PowerSellers, 240 Yellow, shipping with, 129 unsolicited requests for personal information, recognizing, 198 UPS (United Parcel Service), shipping with, 123, 127‑128, 153‑154 UPS shipping calculator, 124 UPS Store, 124 used items, selling, 6‑7 user IDs, creating, 29‑31 usernames, creating, 29‑31 USPTO (U.S Patent and Trademark Office), 179 U ... Get your business licenses and tax IDs, learn about eBay policies, and decide when and how to expand your business 173 14 Protecting Your eBay Business from Fraud Learn to spot fraud, and what... software to track sales and inventory) Chapter 1: Why Start an eBay Business? Figure 1.1 eBay s homepage eBay Businesses Are Like No Other Businesses Doing business on eBay is unique; there’s... opportunities Appendixes A eBay and Third-Party Tools 301 B eBay Icons 321 Index 323 Contents Part 1: There’s No Business Like eBay Business Why Start an eBay Business? Becoming an Instant