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How to sell on eBay (and make money)

Practical tips for getting started and making money selling on the global eBay marketplace.

Since its launch in 1995, eBay has grown rapidly from an online auction site to a powerhouse ecommerce marketplace.

In 2020, you can find (and sell) practically anything on eBay.

We drill down the ways that you can turn the marketplace into a profitable side hustle.

Note: Because eBay does not have a New Zealand site we’ll be looking at eBay Australia in this guide.

How can I sell items on eBay?

There are two pathways you can take as a seller on eBay: be an individual “hobbyist” seller or open up an eBay Store as a professional seller.

Both require you to open up an eBay account.

This is available to anyone with a credit card. It’s free, and can be done by hitting the “Register” button on the eBay website.

eBay seller screenshot.

Should I sell as an individual or as an eBay Store?

If all you plan to do is make some money back off old clothes and unwanted presents, then selling as an individual is the more fitting option. It won’t be a side hustle exactly as you probably won’t churn out much of a profit, but it is a nice way to get some extra cash into your pocket.

Selling as an individual

  • Free to list up to 40 items per month
  • A fee (10.9%) on every sale, including any postage and handling costs charged to the buyer

Ebay store

  • Three subscription tiers starting from $24.95 per month
  • A fee (4.8% or more) on every sale

The right option for you will depend on the number of listings you have and the main categories you sell in. Use eBay’s fee illustrator to work out whether opening an eBay Store or selling as an individual will help you save on fees.

How do I decide what to sell on eBay?

You can sell virtually anything on eBay, as long as it’s legal and ethically sound. Items you can sell include clothing, electronics, toys, memorabilia and even cars.

Popular eBay categories

  • Fashion
  • Motors
  • Home and garden
  • Electronics
  • Sport
  • Health, beauty and baby
  • Toys and media
  • Collectables

Some prohibited or restricted items on eBay

  • Adult items
  • Alcohol
  • Animals and wildlife products
  • Artefacts, cultural heritage and grave-related items
  • Firearms
  • Drugs
  • Food
  • Gift cards
  • Real estate
  • Used cosmetics

How to find products to sell

Like any good business, sourcing the right products to sell on eBay is key.

If you’re considering selling as a small business or store but aren’t quite sure what to offer, take a squiz at what’s currently trending on eBay. It’s a good indicator of what customers are currently purchasing.

Another option is to look for gaps in the market. That is, items that have very little competition on eBay. Then consider if it’s a profitable business item for you to sell.

Trending products on Ebay

How much does it cost to sell on eBay?

There are four main costs to consider when selling on eBay: subscription fees, insertion (listing) fees, final value fees and PayPal transaction fees. The fees below are accurate as of 4 August 2020. Note that all prices listed are in Australian dollars unless otherwise stated.

Seller tip: The importance of an eBay fee calculator

With all these fees to consider, it’s easy for an item that sells for $50 to return you only $43. I’ve had moments where I’ve dropped the price of my unwanted threads to $0.99 (plus postage) for a quick sale and wound up at a loss due to all the fees. Before you put a price tag on that baby, enlist the help of an eBay calculator (there are stacks of apps and online calculators available) to see whether you’re pricing your items suitably.

Subscription fees

If you want to open an eBay Store, there are three paid subscription tiers to choose from: Basic, Featured and Anchor.

Basic Store packageFeatured Store packageAnchor Store package
Subscription fee (excluding GST)$24.95/month$54.95/month$549.95/month
Free listings per monthUp to 600 fixed-price listings or auction-style listings in the Collectables categoryUp to 1,500 fixed-price listings or auction-style listings in the Collectables categoryUp to 250,000 fixed-price listings or auction-style listings in the Collectables category

Insertion fees

If you’ve run out of free listings or the item you want to sell doesn’t qualify for a free listing, you’ll need to pay an insertion fee.

Basic Store packageFeatured Store packageAnchor Store package
Auction-style listings$3$3$3
Auction-style listings in Collectables category$1$0.05$0.05
Fixed-price listings$0.50$0.20$0.05
Fixed-price listings in Media categories$0.05$0.05$0.05
Classified Ad listings in Real Estate category$49.99$49.99$49.99
Classified Ad listings in other categories
(except Motors)

Final value fees

A final value fee is charged whenever you sell an item on eBay.

Fees are calculated as a percentage of the total sale price (including postage and handling), but the percentage amount varies depending on your membership level and the category the item was listed in.

Fee amounts range from 4.8–9.5% and you can find a full list of the final value fees for different categories on eBay’s site.

The maximum final value fee per item is $400.

PayPal transaction fees

Another fee to be wary of is a PayPal transaction fee, which applies to the total sale price (including postage and handling):

  • For online payments from within New Zealand, this fee is 3.4% + a fixed fee
  • For online payments from overseas, this fee is NZD$6.99 + 3.4% + a fixed fee that varies by country

Let’s crunch the numbers

Let’s find out what your fees would look like on eBay if you sold a coffee machine for $500 (including shipping costs) to a buyer in the US. For this example, we’ll assume you have a Basic Store package.

You’ll need to consider the following fees:

  • Insertion fee: $0.50.
  • Final value fee: $30 (6% of sale price including shipping).
  • PayPal transaction fee: $23.99 (3.4% of sale price including shipping + $6.99).
  • This means total fees of $54.49, which is 10.9% of the transaction amount.

However, you’ll also need to consider:

  • Ongoing subscription fee: $24.95/month.
  • Currency conversion costs: 2.5%. When you convert USD to NZD to withdraw the funds to your local bank account, PayPal charges a 2.5% exchange rate mark-up. However, you can lower your currency conversion costs by opening an online seller account.
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How do I start selling on eBay?

Before we get stuck in, here’s a little background about me:

Stephanie Yip
  • Who am I? I’m Finder’s travel editor by day, side-hustler and serial eBayer by night.
  • How long have I been using eBay? I’ve been on the marketplace, buying and selling, for 15 years.
  • What does my eBay account look like? I have a 100% positive feedback rating across 1,400+ reviews. I am also regarded as a top-seller for my excellent service.
  • What do I sell? I mostly sell as an individual making back money on unwanted items such as clothes and CDs, however I have dabbled in selling bulk items such as flash tattoos.

You can set up an eBay Store by following a handful of simple steps:

How to price your items

There are a few factors to consider when working out how to price items on eBay:

  • Your costs. Consider how much it costs you to source, store and ship the item you’re selling. Remember to also include eBay fees and all other overheads in your calculations.
  • The market. Research similar products on eBay to discover how they’re priced and how different price points affect sales success.
  • Your buyers. You’ll also need to think about what represents a reasonable price for buyers. You can do this via market research and experimenting with different pricing strategies.

Picture not described

After a little trial and error, you should be able to find the perfect price point that represents a decent profit for you and good value for shoppers.

What types of payment does eBay accept?

There are a few different ways to accept payment on eBay. The main option is PayPal and you’re required to offer this as a payment method in most listing categories. PayPal allows shoppers to pay you straight from their PayPal account, from their credit card, debit card, with an eBay voucher or gift card.

Other payment options you may choose to accept are:

  • Bank transfers
  • Bank and personal cheques
  • Money orders
  • Cash on delivery
  • Payment on pick-up, including cash

How to get paid by international buyers

When you make an international sale and the buyer pays with foreign currency, you’ll need to find a way to convert those funds to New Zealand dollars. While PayPal offers an easy and convenient currency exchange option, it’s not cost-effective – when you want to withdraw funds to your bank account, PayPal converts them to NZD at a rate 2.5% above its base exchange rate.

If you’re a high-volume seller, it might be worth opening an online seller account. These multi-currency accounts allow you to receive payments in multiple currencies, so you can avoid PayPal’s poor exchange rate. You can then hold funds in your account if you need to pay overseas suppliers in their local currency or take advantage of superior exchange rates whenever you want to repatriate to AUD.

Check out the table below for details of the features and fees of a range of online seller accounts.

Min. Transfer Amount Transfer Speed Online Transfer Fee Rate Amount Received Description CTA Details
GBP 5,000 1 - 2 days NZD 0.00 0.704 USD
CurrencyTransfer is an online marketplace that lets you shop around for the best exchange rate. Use it to take your ecommerce business to the next level. Go to site Show details
AUD 250 1 - 2 days NZD 15.00 0.704 USD
Receive local bank account details for 6 currencies. Free account signup with 24/7 support. Go to site Show details
NZD 1 1 - 2 days NZD 80.00 0.707 USD
Send or receive money with the real exchange rate and a multi-currency account. You can also get local bank account details in the UK, US, Europe, Canada and Australia. Go to site Show details
NZD 2,000 2 days NZD 0.00 0.704 USD
Open bank accounts in Australia, the UK, US, Canada, Japan and Europe. Send and receive large funds with zero fees, including same-currency supplier payments. Go to site Show details

Compare up to 4 providers

Disclaimer: Exchange rates change often. Confirm the total cost with the provider before transferring money.
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How to organise shipping

There are a couple of eBay shipping options available:

  • Ship items yourself. You can organise shipping for each item yourself through NZ Post or a courier service. eBay provides a postage calculator to help you calculate domestic and international shipping rates.
  • Use a fulfilment partner. The second option is to use a third-party fulfilment or dropshipping provider to store inventory and ship orders on your behalf. There are many third-party providers that can handle international shipping.

Whichever option you choose, make sure to compare quotes from a range of shipping providers to find fast and cost-effective delivery options.

colorful socks

How do I market my products on eBay?

There are multiple ways to promote products on eBay, including:

  • Promoted Listings. This tool is available to all eBay Stores and allows you to increase the visibility of individual or multiple listings to potential buyers. If a buyer clicks one of your promoted listings and then buys the item, you’ll pay an ad fee.
  • Promotions Manager. eBay’s Promotions Manager is free for all Stores and allows you to run a range of promotional campaigns. These include large-order discounts, codeless vouchers, promotional postage rates and sales.
  • eBay Deals. By registering for the eBay Deals programme, where buyers can shop the platform’s best offers, you can gain increased exposure for your products.

Other ways to increase the chance of a sale

Something to keep in mind is that some products won’t sell. This is the nature of the marketplace game. Here are a few tips I’ve learned from my time flogging my unwanted wares on eBay.

  • Sell new (or as new) items. According to eBay, 90% of items sold on the platform are new. This should come as no surprise as you wouldn’t want to pay for a worn-out shirt (unless it’s something exceptional like a collectable) when you can buy a brand new one in store for the same price. If it’s a dress with a tag you’ve never worn, then it’ll appeal to someone more than jeans you’ve worn to patches.
  • Put effort into your images. People shop with their eyes, and if they see something visually appealing, they’re more likely to click. Take high-quality photos, take photos at different angles, take photos with a nice clean backdrop so the item doesn’t get lost in a potential buyer’s feed.
  • Price your product below your competitors. Buyers come to eBay to snap up a bargain, so yours has to be the best option out there. Keep sussing out the competition and remain price-competitive.
  • Be descriptive. This is particularly important if you’re selling second-hand items. Be upfront if there are any faults with your item. If you don’t and the buyer receives their item, they have grounds to request a refund on the basis that it was “not as described”, which could put you out of pocket.
  • Get your feedback up. Like with any business, you need to build confidence in your buyers and feedback of “0” is not a good look. This feedback is given for both purchases and sales. If you’re finding it difficult to get off the ground and think it may be because you don’t have a lot of feedback to your name, consider purchasing a few items you need through eBay to build up some feedback and establish yourself as a serious user.

Risks and pitfalls to watch out for

eBay has a healthy list of services for sellers to help protect them as much as possible in the online selling space. This includes the following:

  • Unpaid item disputes. If a buyer doesn’t pay you for a sale and hasn’t replied to your messages, you can open an unpaid item dispute through eBay’s resolution centre. The online marketplace will then intervene to try and resolve your issue. If the buyer is at fault, you’ll be given a full refund of your fees.
  • The ability to block eBay buyers. If issues have arisen with a buyer, you can block them from bidding on your items in the future.
  • Feedback. Customer feedback is a key indicator of how well you’re performing as a seller and how trusted you are in the eBay community. It’s encouraged that any customer who isn’t satisfied with the product or with the seller’s behaviour contact them prior to submitting feedback in an attempt to resolve the issue. If you feel you’ve unfairly been given negative feedback, you can contact eBay to dispute this and have the feedback removed. Feedback also brings confidence in your buyers, so it’s important to encourage and build this.

However, there are a few potential issues every new eBay seller should be aware of:

  • Fees. There are several different fees you need to be aware of when selling on eBay, so make sure you understand all the separate charges that will apply to your listings and sales.
  • Competition. eBay is one of the world’s largest online marketplaces and there are millions of products listed on the platform. As a result, getting noticed can be difficult.
  • Limited customisation. As is the case on many marketplaces, there are limited opportunities to customise your eBay Store.
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