Newer sellers often forget that there are some major costs associated with selling products on eBay. They quickly become excited when the auction sales start rolling in. However those who know how to amake money on eBay know that all of the costs associated with each item and the sale of that item must be comprehended before a seller can determine if a profit has been made.
There is a long list of costs associated with starting down the road to amake money on eBay. Those cost categories include:
·Cost of Goods Sold
·Listing Fees
·PayPal Fees
·Final Value Fees
·Shipping and Handling
·Profit
Note that each category includes several components. For example Cost of Goods Sold needs to include not only the price of the item, but also freight costs. Don’t forget that costs associated with missing and damaged items from shipping must also be included.
To amake money on eBay, a minimum profit target should also be included as a measure of auction success. One method is to factor in a per-item profit target as a cost figure. Another would be to compute the actual seller labor associated with each transaction, set a per-hour compensation rate, and then add that to the total. Your accountant can work with you to determine final real profit levels.
Do you want to amake money on eBay? Start by knowing all of the costs associated with a transaction. Only then can a seller really know whether there is a profit or loss on a transaction.
