There is little doubt that given the potential audience

advertising on eBay can be very cost effective. Compared to

other forms of advertising it is relatively inexpensive.

However, many eBay users rarely bother to work out exactly what

it is costing them to make a sale.

There are the obvious costs such as the listing, enhancements

and final value fees. Also you have to add the charges made by

Paypal if that is the option of payment chosen by the buyer.

But then you should really also consider what I call the

invisible costs. Let me explain, if for instance you buy many

of the items that you sell from Flea markets and garage sales

what value do you place on your time going to such events and

don’t forget any travel expenses to get there.

Once you have got your items home you will need more time to

research, photograph and list your purchases. Now add the time

you spend packaging the items after sale and standing in line

to post them. You could easily find that each sale you make on

eBay could take an hour or more of your time.

If you really want to know how much time you spend on your eBay

business you need to keep a detailed diary for a few weeks.

Record the time when you leave your home on “eBay business” and

when you return. Add any expenses other than the cost of any

items you buy to sell on eBay. Once you are home log any time

you spend listing, photographing and packing items.

Do this for a few weeks and this will give you a good idea of

the non costed time you spend on your ebay business in an

average week. Next decide what you think your time is worth

$10, $20 or $50 an hour, this figure is entirely up to you and

represents what you would expect to be paid for an hours work

by someone else.

You can then work out how many items you sell a week on

average. So your figures might look something like this.

Average hours per week 6 at $20 an hour, average number of

items sold per week 30. This would mean your time is worth $120

a week to you and if you sell 30 items it has cost you $4 of

time per item.

So to work out your true profit on any item you need to add not

only the cost of the item but also the other costs. eBay, the

Paypal and shipping fees and your time costs. You will now be

able to calculate what profit or lose you made on the sale. You

should also include something to cover those “mistakes” that we

all buy that disprove the theory that you can sell anything on

eBay. After that you will be able to calculate the true profit

that you are making from your ebay business.

I am not knocking eBay, quite the contrary; I think it is one

of the best methods for anyone to build a successful online

business. The point is that if you are to make real profits on

eBay it is important to make sure that you use your time to

best advantage. This can mean getting software to speed up some

tasks and possibly reviewing how and where you buy the items you

sell through eBay.