Tales from the Digital Trenches: Part One
On 12/6/2005, I opened up an eBay store to sell two board games. I missed the Christmas buying season, but I had a thirty-day free trial, so what the heck.
I bought advertising, posted on forums, updated my signature and wrote about the store in my blog. Over the course of 90 days, I sold four games. It was exciting, but the reality of the numbers told a different story: - - - - Income
- One game gave me a gross profit of 11.99 and I sold one.
- The other game gave me a gross profit of 6.99 and I sold three of these.
- Total gross profit = 32.96.
- After subtracting per unit fees charged by eBay and PayPal, the adjusted gross profit = 21.53.
- Expenses
- eBay store 15.95/month x 3 = 47.85
- Advertising fee: 17.00
- Total expenses: 64.85
- Net Profit/Loss
- - - On 4/6/2006, I closed the store.
I needed to sell three times as many games (assuming the same 3:1 ratio) to break even.
My solution is to focus on marketing the games through my Thumbs Up Games website, where I can eliminate the recurring expense overhead.
I learned that, if I am going to sell on eBay, the profit margin has to be larger, or the demand has to be greater.
Not a bad lesson for 43.00. |
