How to Transform Your eBay Hobby into a Profitable Business

Millions of people around the world use eBay to sell unwanted items to clear their homes or make a little extra money on the side. A proportion of these discover that they love the excitement of selling online and the satisfaction of generating profit. Some continue selling as a hobby, while others go all in and try to make it their full time job, creating their own eBay business. If you are on the cusp of doing the same, read the following advice first to give your new eBay business the best chance of success.

Research, research, research

The first step to turning your selling hobby to a fully fledged business is to work out whether it is a viable proposition or not. After all, the aim of any business is to make profit. It is imperative therefore, to first conduct market research. This involves examining the demand, average selling prices and competition for the type of items you may want to sell. Another important part of this stage is to consider all potential expenses involved with the business.

What to do: Carefully examine completed and active eBay listings. Check other online marketplaces to compare prices and stock. Read and scrutinize advice from veteran sellers on forums, message boards and selling websites. Calculate the cost of stock, packaging materials, storage supplies and shipping fees. Evaluate the benefits of opening an eBay Store.

What not to do: Don’t stick rigidly to one business idea. Be flexible. During this research, you may discover niches and shopping trends that have the potential to be more lucrative. It is advantageous to have an interest in what you are selling, but be open to new ideas and related items.

Register your business (if applicable)

In many countries, registering a business is mandatory. In others, business registration may not be needed until a certain level of income is attained. Due to such variation, it is important to carefully research the rules and regulations in your home country before going any further with your business.

What to do: Find out what is required to start your business legally, whether that involves registration, business license or otherwise. Start as you mean to go on; file any necessary paperwork accurately and promptly, keeping additional copies for your own records.

What not to do: Don’t be afraid to ask for help. Free assistance for small business owners is often available through non-profit organizations or government agencies. The United States government, for example, has an online learning center provided by the Small Business Administration.

Consult a tax accountant

For some aspiring eBay business owners, this step will come sooner rather than later. Depending on the regulations in your home country, it may be necessary to consult a tax accountant during the business registration stage. Consulting a tax specialist is also helpful to understand your tax responsibilities and expense restrictions.

What to do: Speaking to a tax specialist prior to the launch of your business will ensure compliance to tax laws and regulations from the very beginning. This is also a good time to start thinking about how to organize tax records and expense receipts.

What not to do: Don’t just rely on word of mouth, find a regulated tax advisor to discuss your business with. Tax regulations change often and can be complex to understand.

Find a way to source items

Most casual eBay users sell spare items from around the home. For those wanting to make eBay selling into a business, it is crucial to find consistent and sustainable sources for products. Depending on the type of business you are looking to build, this could be junk yards, wholesalers, thrift stores, estate sales, flea markets etc.

What to do: Be careful to secure more than one source or supplier for your products. It is never a good idea to keep all your eggs in one basket. If possible, take time to build a relationship with suppliers. It will likely pay off as your business grows.

What not to do: Don’t act hastily. Sit down and write a list of potential sources. Investigate each supplier, weighing up regularity of available stock and predictability of item quality with prospective profits. This will save time (and most likely, money) later.

Formulate a business strategy

Much like traditional businesses, eBay sellers should also have a strategy. This can include financial goals, techniques to remain competitive and plans for growth. The latter, for example, could include branching out beyond eBay to other online marketplaces or even outsourcing.

What to do: Think about your business’ USP (unique selling point). What makes your business better than your competitors on eBay? Is it free shipping, good customer service, quality products or low prices? Consider where you’d like your business to be this time next year and how you will aim to achieve that.

What not to do: Don’t be afraid of doing what feels right for your business. Every eBay business is unique and what works for some sellers will not work for others. Using Promoted Listings, for instance, may be worth it for some sellers while others prefer not to pay an extra fee for the increased visibility.

Create a business website

Having an independent website for your fledgling eBay business promotes authority, legitimacy and professionalism. It also offers an opportunity to advertise items on another platform. While eBay offers a convenient marketplace with millions of potential buyers, diversification in business is always a good idea.

What to do: It is easier than you may expect to set up a basic website. It is even simpler to display eBay listings on it with the help of Auction Nudge, our free tool that automatically inserts live auction listings with a simple piece of code.

What not to do: Don’t be intimidated by upfront costs and fees of having a business website. The annual fee for a domain name ( varies between $10-30. Website hosting starts at around $5/month, a small investment for a potential moneymaker.

Separate your business and personal life

It is important to take your new business seriously. One way to do this is to create separation between your business and personal life. Not only can this help for organizational purposes, but it also can increase productivity while working and a better sense of well being when not.

What to do: Section off a corner or room in your home to use as an eBay workspace or office. Think about opening a new bank account the business. Always keep receipts and track expenses. Create a professional email address and/or business eBay account, if applicable. If finances allow, purchase a separate laptop, cellphone or tablet for business use only. Consider the value of having an official business address.

What not to do: Don’t overwork. When running your own business, it can be tempting to work around the clock. Create a work schedule and try to stick to it.

Veteran eBay sellers, did you find the transition between hobby and selling business difficult? 



Gemma is our all things eBay expert. Originally from the UK, she now lives in Canada and travels extensively. You can read about her travels at her blog Off Track Travel.

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