Now that you have some ideas about how to make money selling online, you’ll want to consider a few basic startup costs and investments for your selling business.
Whether online reselling is “just” a side-hustle next to your 9-to-5 job, or you are making strides to build a larger-scale operation that will provide 100% financial support, there are some basic commitments you need to make. But size and scale can vary widely.
Based on our conversations with resellers of all sizes, we’re here to share some estimates of what successful long-term-but-smaller-scale sellers are doing. Of course, you can do more or less depending on your needs or ambitions.
How Much Time Can Reselling Take?
Let’s start with arguably the biggest investments you can make in your business’ success: your time. Here’s a peek at how flippers spend their time:
- Sourcing (in stores): Sourcing from brick and mortar stores can be an all-day event. Some sellers spend between 4-12 hours in one day sourcing, but may only source 2-3 times a month. Sourcing hours include the time to drive to these locations, scavenging the store for the best items to resell, and potentially dropping off your haul before hitting the next store.
- Sourcing (online): You won’t be spending money on gas, but you’ll still be spending a good amount of time sourcing online. It takes some sellers 8 hours a week to stock up on new inventory online. This includes finding the inventory, as well as researching market prices and popularity of the items.
- Receiving and testing: Depending on the condition of merchandise you receive, you’ll need to test the items to make sure they are in working order and fulfillment-ready. If your haul is large, expect to spend a few hours testing the products before you can begin listing.
- Listing: On average, it may take up to 10-15 minutes per item to list items on eBay that you haven’t sold before. This includes researching detailed product information, writing your description, and providing photos. If you choose to sell using Amazon’s FBA service, listing is not much of an issue, as Amazon takes care of the nitty-gritty. When listing an item on Amazon, you set your price, the item condition, and your shipping rates.
- Fulfillment: This is where you package an item that’s been ordered and ship it to the customer. If you’re not using a fulfillment service, this is one of your last steps in the sales process (permitting there are no customer-facing issues post-delivery). Depending on where you live and how often you ship, you can usually steer clear of making an extra trip to the post office and instead, make arrangements with USPS, UPS, or FedEx to have your items picked up from your home.
- Customer Service: How you go about handling your customer service can be a make-or-break-it part of your business. In this age, customers are not just purchasing products, but experiences. Make sure you’re promptly answering customer product questions, providing accurate shipping and handling times, and addressing and correcting any product-facing issues. Remember, the customer is king. Get advice on how to manage relationships with your buyers, whether online or in person.
One of the benefits of being a reseller is that you get to decide how much time to spend on the job. Successful part-time resellers may spend around 20 hours per week on their side business, while full-time sellers can spend anywhere between 40-80 hours in a week.
What Expenses Are Necessary?
The great thing about online selling is that you can (and most people do) operate entirely from your own home. That means your up-front startup costs need not include an office space and other expensive overhead. So, what do you need? In addition to the upfront cost of inventory, you’ll need a few basic supplies.
- Shipping and packing material: This includes (but is not limited to) boxes, envelopes, bubble wrap, tape, and cellophane wrap. Your average cost for these items will really vary based on what, how much, and how often you’re shipping, but there are some savvy ways to save on shipping and supplies.
- General Office Hardware: Having access to a computer, printer, and a smartphone will be an important aspect to your new business.
- Smartphone: Using a smartphone to assist with operating your reselling business has been a game changing tool in the reselling world. Like your computer, you’ll be able to manage your marketplace sales, access email, and pay bills (among many other things). You can now even source wholesale inventory from your phone with the free BULQ app, which is available for both Apple and Android devices.
- Printer: A printer is more of an optional piece of hardware, but can be useful for printing documents such as wholesale manifests and custom invoices. You can purchase an HP Deskjet printer for just $30.
- Specialty Hardware: Like any business you enter, there will be speciality hardware that will be particularly useful. Consider investing in some of these products:
- Barcode Scanner: Having a barcode scanner will make listing a breeze if you’re sourcing deep skus of products like books and DVDs. There are plenty of barcode scanning apps (many for free) available right on your smartphone. Alternatively, you can get one for around $10 on eBay.
- Label Printer: A thermal barcode printer for printing shipping labels is also a smart investment for most sellers. Thermal printers do not require ink so you’re saving money on overpriced toner and ink. You can purchase a top-rated Zebra LP 2442 Thermal Printer for just $99.99.
- Shipping scale: A scale will be essential to your business as you’ll be able to use it to determine shipping costs to the customer or how much it will cost you if you decide to offer free shipping. You can purchase a scale for about $12 on eBay.
- Software and service tools: There are plenty of services out there designed to help you save time (and money) with your product and pricing research. These tools for sellers can offer assistance with all aspects of product research, including current market prices, product review count, Amazon ranking, and competitor tracking.
Though not huge, the ongoing startup costs of supplies can add up and dig into margins, thus reducing your profit. It’s important to be as savvy and scrappy when sourcing supplies as when sourcing inventory.
The good news here is that you can reuse materials or source packaging material from non-traditional sources. Grocery stores and offices will often give boxes and excess shipping material away for free. Pro tip: build relationships with local stores and offices so they’ll give you a call when it’s time to haul away their trash (i.e., your treasures).
Additional expenses to consider are the cost of shipping and returns, business license fees, taxes, and as-needed labor.
If you’ve tried dabbling in online selling and haven’t seen success yet, don’t throw in the towel too soon. Profitable flipping is not a skill you’re born with, but one that you can develop with practice and some practical know-how. Let’s make sure you’ve got all the basics covered, and then some.
Just how much money can you make selling online? There are plenty of BULQ customers who do this as a full time job, earning anywhere from $2,000 to $10,000 a month. We can’t guarantee your earnings, but we can point you to success stories of sellers who put in the time, turn great profits, and are even willing to show you how they did it:
Hooked on Pickin’: What Sold on eBay
Walter Knoblock: BULQ Video Game Unboxing
Chad Bartlett: BULQ Unboxing Reveal
For more resources on how to be a successful seller, check out more how-to articles on the BULQ Blog and follow BULQ on Facebook and Twitter.