The New ebay: The Official Guide to Buying, Selling, Running a Profitable Business

Chapter 20

Researching products, competitors and customers

Conducting the right research can make the difference between building a profitable eBay business and one that struggles to survive. One of the great things about eBay is that it is a transparent marketplace — that is, most of the information about products, categories and other sellers is visible for all to see. This gives you a unique opportunity to gauge the potential for your own eBay business before you make any investment in products or back-end operations. Conducting thorough research is the critical first step in creating a viable long-term eBay business.

Industry research

A good place to start is to research a number of industries (or categories or products) to see what information you can find online. Look for annual and other financial reports of companies that sell or manufacture the products you’re most interested in selling. What are the growth figures in these industries over the past three years, and what do experts predict for the future of sales in that industry? What is happening to the average sales prices of products in the industry — are they falling or steady? (Even a rising price is not necessarily an indicator of long-term viability.) Who are the largest sellers and manufacturers in the industry, and are there any imminent local or international threats? Check out IBISWorld (www.ibisworld.com.au) or Roy Morgan (www.roymorganonlinestore.com), which release hundreds of industry reports each year. ...