Let’s put the technical stuff and business aside for now and talk about life!
I have been in the online selling business for more than 10 years now (actually I’m quickly approaching the 15 year mark – I’m starting to feel old!) and have worked directly and in-directly with thousands of people over this time. By working with directly I mean all of my Easy Auction Business, eCommerce Magnates, Second Income Generator, and Spicy Auction Templates customers and of course in-directly by answering tens of thousands of emails/messages and forum posts.
So I can safely say that I’ve seen it all.
Many people contact me with lengthy emails, explaining their life stories, complex medical conditions and un-employment situations. And I always try to do my best to give at least some advice to every person who contacts me. Of course, my time is very limited and I can’t reply to every email with an essay but still – even a short answer pointing them in the right direction is better than nothing, right?
One of the most common situations people write to me about is how they’re sick and tired of their job and how they want to start a full-time business, selling stuff online. And that’s great! Being an entrepreneur for so many years, it still always touches me personally when someone wants to make a big change in their lives and do their own thing. This is exactly what I did all those years ago, quitting my first and only day job at a Primark warehouse (you can read more about that on the About Me page).
However – there’s a problem. Not everyone is made to be a business owner, that’s just the truth. It does take certain skills, attitude, and way of thinking to become a successful online entrepreneur in this day and age as make no mistake – millions of other people around the world want the same thing and there’s simply not room for everyone.
On the other hand – I have seen some phenomenal successes achieved by “ordinary” people during my 60 Day Blueprint program. Sometimes all it takes is hard work and dedication and you can basically achieve anything you want in life. It has nothing to do with how smart you are (I don’t consider myself as super smart) or your previous work experience (even though a business environment helps) – it’s more about that attitude – hard work, patience and just working towards your goals.
So I’m not saying you can’t become that super successful online entrepreneur BUT there’s a small chance that you’re simply not cut out to be one. You may simply not have a big enough desire or you may not truly be willing to work as hard as is needed to survive in the business world. Read More…
It’s 1st February today, congrats – we have moved passed the year’s darkest month and slowest sales period and can start looking forward to spring and summer!
Today I’m starting a weekly, 4 part blog post series covering the most common and important terminology used in the online selling world.
Today we’ll start with General Business terms and in the following weeks we’ll cover:
Importing & Shipping
eBay & Amazon
So in total there will be 4 posts that should cover most of the terms you need to know about.
It may be geared towards people who are totally new to selling online but still – even experienced sellers sometimes mix up important stuff so it’s not a bad idea to go over the basics every now and then. And as we all know from Dragons’ Den – there is no bigger problem than not knowing your numbers, right?
So let’s get started with a list of the most common business terms that every entrepreneur should know about!
Sales/Revenue – amount of money you have received for the sale of goods. Example: if you sell an item for £10 and you sell 100 items, your sales would be £1000. Usually, when showing sales, you don’t take off ANY expenses associated with these sales. For example, this means that you wouldn’t take off PayPal fees from this number.
Turnover – basically the same thing as Sales but the term “Turnover” is usually used to show sales in a certain period of time. So if someone asks you what your turnover was for the last 12 months, you would give your total sales number for that period.
Gross profit – this is one of those numbers every Dragon is looking for! Gross profit means your Sales minus Cost of Goods. So for example, if you buy an item for £50 and sell it for £80, your gross profit is £30 (£80 – £50).
However you do not deduct any further expenses associated with sales, like taxes, salaries, rent etc. Only the cost of goods.
Net Profit – this is the REAL profit as we speak – money you make after ALL expenses are paid. This includes cost of goods, salaries, shipping costs, rent, utility bills etc. This essentially means the money you take home, after paying tax (if taxes are applicable). Read More…
Anyone who has been reading my blog for a long time, or better yet has purchased either my Easy Auction Business or eCommerce Magnates video course, will know just how much emphasis I place on BRANDING.
However, some people still view branding as something frivolous… something that you can do if you have the money and business is strong, but certainly not something that’s necessary.
I disagree with this completely! I view branding as an integral part of my online businesses, and creating my own brand products is my no.1 strategy for building real, profitable, and sustainable businesses.
But for anybody who’s not completely familiar with the term, what is product branding?
Well to put it simply – it’s when you take an unbranded product, i.e. a product that doesn’t have a brand, logo, company etc. shown on it, and YOU brand it – either the product itself, the packaging, or as in most cases both.
This in effect creates a completely NEW product which you own and can sell online, be that on eBay, Amazon, or your own ecommerce store.
But I know that some of you will now be wondering “why?”
After all, branding a product will add to the cost and it really doesn’t add any practical value… so it’s a waste, right?
WRONG! Premium packaging adds to your brand and increases the perceived value of the item you’re selling.
Perceived value is something I actually mention quite often, particularly in my video courses, but it’s still something that most small time eBay sellers complete ignore – despite the fact that it’s honestly one of the most important factors in creating a real brand and business.
Just look at some of the world’s top companies… Apple are in fact a perfect example. Some of their products cost a fraction to produce in comparison to some of their competitor’s offerings, yet the perceived value (among consumers!) for Apple products is unparalleled.
This is all down to their brand and you simply can’t create a brand with an unbranded product!
The other big benefit to branding, which I briefly mentioned above, is that you create a unique product and this helps hugely with comparison shopping, where the buyer simply chooses the cheapest option, as it’s much harder to compare two different products – even if that difference is only the branding. Read More…
I’ll talk more about what this machine is and what it can do a bit later on, but for now I want to share some valuable tips on shipping & transporting such heavy machines from the US.
Shipping Heavy Machinery
First off, this machine was manufactured and shipped from the US. As it’s a heavy piece of equipment (the total shipment weight was 340 kg), I was considering using sea freight to get it delivered BUT as I needed it quite urgently, I decided to go with air freight in the end, and it only took seven days to arrive.
Now, here’s a hot tip – if you need to import anything like this from the USA, shop around for prices!!! And don’t only compare quotes you get online/over the phone but bargain as well – and I mean bargain HARD!
In the end, it was a fight between TNT and DHL to deliver this to me and they basically placed counter offers to each other. DHL won (by some £30 or so) and the final price was almost 45% less than my initial quote. So with such large/expensive air freight shipments, it’s always worth it to negotiate the best possible rate DIRECTLY with the manager.
As this machine is so heavy, I knew that I’d need at least 4 men to move it around and place it on the special desk it came with. In such situations, you should always make sure you have arranged people to help you beforehand as courier company drivers are usually not very willing to help with any moving (they’re not really supposed to) plus in this case it wouldn’t have been enough anyway due to the extreme weight. Read More…
As covered in that guide, there is really one main exception to this rule, and that’s if you sell zero rated goods. Zero rated goods have a VAT rate of 0% so in this case you’d actually be better off registering for VAT from day one as it wouldn’t affect your sale price but you would still be able to reclaim VAT on all business expenses (more on that later).
The products that qualify for 0% VAT or the reduced rate (usually 5%) are very rare, so it’s highly unlikely that this will apply to you.
You can take a look at this page for a full list of reduced or zero rated goods and services:
Some of the more common products that qualify for 0% VAT include:
Leaflets / Flyers
So if you happen to sell one the above products, then you should definitely look in to registering for VAT, if not – then hold off for as long as you can!
Let me say this again, so that it’s 100% clear:
You will (almost always) be worse off if registered for VAT!!!
Strangely there is actually a lot of confusion about this point, especially online, and I think this stems mainly from a misunderstanding of the figures and in particular – reclaiming VAT on business expenses. I don’t want to spend too long on this aspect of VAT registration, as I have covered it previously, but let’s do a very quick example calculation:
Minalto’s Muscle Machines
Let’s say I have a business selling workout equipment and gym gear.
Turnover is £75,000 a year and gross margins are 60%, which means a mark-up of 150% (100-200%+ is what I aim for when importing from China).
So if I’m NOT VAT registered, the calculations are simple – I pay 20% VAT on the total value of the goods I import, which is £25,000 a year.
20% of £25,000 = £5,000 VAT paid per year.
Now let’s see how it works out if I am registered for VAT:
So the first difference is that the VAT I pay on the import value of my goods is reclaimable, so I’ve saved £5,000 already!
Plus I can also reclaim VAT on all of my business expenses, and this includes:
Postage (some postage is VAT exempt though, such as 1st and 2nd class stamps)
Using our £75,000 annual turnover, let’s be generous and assume £15,000 in VAT reclaimable business expenses. Read More…
As an entrepreneur, I always try to keep up to date with general business happenings, even of companies and industries nothing to do with me.
One thing in particular that I enjoy is following successful companies in order to see what I can learn from them, be it their general business practices, a terrific marketing campaign, great product design etc.!
There are so many innovative companies out there, that if I can learn just one or two things to use for my own business, then it’s worth my time.
And today I want to talk about one company in particular – Kia Motors.
Twenty years ago Kia was considered nothing more than a below average South Korean car manufacturer with just a few, fairly mediocre models available.
But fast forward to 2015 and KIA has achieved phenomenal success in the UK, Europe and the rest of the world.
So how did they achieve this?
After all we need to analyse the how and why to be able to learn anything that we can use ourselves.
Well, Kia’s success has undoubtedly been a combination of a number of factors – after all you can’t build a company worth over £9 billion with sales of over £28 billion with a few good ideas – but purely from a customer’s perspective, these are the main factors which I believe has made Kia into the company it is today:
1. Peace of Mind – 7 Year Warranty.
This for me is the no.1 selling point for Kia!
Everybody loves a long warranty and when you can offer 7 years rather than the norm of 2-3 that your competitors offer, then you really differentiate yourself and it’s a huge selling point.
The takeaway here for eBay sellers is obvious – emphasise the reliability and quality of your products.
Not a single day passes without me receiving at least one email from someone who says they can’t compete with the lowest priced sellers on eBay and my answer is always the same – “you don’t have to!!”
Nobody wants to buy cheap if the item isn’t going to work so rather than compete on price alone and cut corners to bring your costs down, instead concentrate on providing a reliable and quality product that you can stand behind proudly. Read More…
Quite often online you’ll see people saying how “it’s cheaper to sell on Amazon vs eBay”… but is this really true?
Well that’s what we’re going to find out today, to put this claim to rest one way or another!
But rather that just list all the fees for selling on eBay and Amazon in a boring table, instead we’re going to take a few examples and go through them one by one. That way we’ll get an easy to compare head to head battle between eBay and Amazon!
Before we get started with that, I also want to quickly go over the fee structure for selling on Amazon, as it differs slightly from eBay, and I know that this can sometimes cause confusion for new sellers.
So as most of you will already know, when selling on eBay you’ll pay the following fees:
This is the fee paid to start your listing. The exact amount depends on your shop subscription, how many listings you create each month, and whether it’s an auction or buy it now listing, but the most you’ll pay for an insertion fee is £0.26 per listing.
Final Value Fee
This is the fee you pay when your item sells, calculated as a percentage of the total transaction amount (including shipping). Depending on the category, the final value fee ranges from 5% to 11%.
Lastly, there is the PayPal fee, which is 3.4% + £0.20 (again calculated on the total transaction amount, including shipping).
Now let’s take a look at Amazon’s fee structure and how it compares to eBay:
First things first – Amazon offer two different pricing plans, depending on your volume of sales – the Basic (sell a little) plan and the Pro (sell a lot) plan. As the Pro pricing plan is better value if you sell 34 or more items per month, that’s the one we’ll be using for our comparison today. Read More…
Anyone who has been reading my blog for more than a few months will know how important I consider outsourcing. I always say that you should outsource as many of the processes in your business as soon as you can, so that you have more time to spend on important tasks that will actually grow your business!
And that’s what today’s post is all about – outsourcing, and specifically – outsourcing your order fulfilment.
Picking, packing and posting orders is one of the most time consuming aspects of any online business, and while you might be able to handle this yourself when just starting out, as your business grows and your sales volume increases, you’ll be left with only two options – you either need to set up a warehouse and hire people to process orders OR you can outsource this completely to a fulfilment company.
Now I have actually written a few articles about fulfilment companies in the past, so if you’re not entirely sure what they are, please take a look at these posts where I explain everything:
Now you may be wondering – if I’ve already covered this all, then what exactly is today’s post all about?
Well, today I want to really explore just how viable fulfilment companies are!
After all, there’s no point in talking about how great they are, how much time they’ll save you etc. if their charges destroy any decent margins…
And that’s why I’ve set up a little experiment/showdown!
I’ve contacted some UK based fulfilment companies and requested quotes for two eBay businesses, so that we can compare the costs and see just who comes out on top!
In my previous articles on fulfilment companies, where I mainly concentrated on the big two – Amazon and Shipwire – I had a few comments from smaller companies, who were offering more of a custom and personal solution, and that’s why I also decided to include some of them in this “competition”. That way we get more varied options, and it’ll be interesting to see how they stack up against Amazon and Shipwire in terms of pricing. Read More…
This is a topic that I’ve shied away from writing about a little bit, mainly because I don’t want to give general financial advice to people without fully knowing their circumstances, finances and plans.
However, I think this is a very important topic and something I need to cover as it really pains me to get emails from people struggling and in debt, all because they financed their online business dream in the wrong way!
So today, I’m going to be going over some of the options for financing a new online business. Let’s get to it!
Firstly, I want to clarify a common misconception about starting an online business which I hear all the time and just don’t agree with and that is “that you don’t really need a start up budget and can create a successful business with practically nothing”.
Unfortunately this is just false!
Of course there are some strategies and business models you can use to get started with a very limited budget BUT these aren’t ideal and you’re very limited in what you can do.
In fact, the main purpose of these low-budget strategies is to build up a proper bank so that you can really launch your business.
So many people think that though you need tens or hundreds of thousands of pounds to start an offline business, you can start an online business on a shoestring budget.
And while of course online businesses are much cheaper to launch than an offline one (that’s one of the great things about the internet – it opens up a lot of opportunities for people) that doesn’t mean that there aren’t still costs involved when you launch a proper online business. Things like:
eBay Store and Template Design
Import Tax & VAT
Initial Supplies and Equipment
It all adds up!
Please don’t take this the wrong way and think that I’m saying it’s impossible to start an online business unless you have a big starting budget as that’s obviously not the case. There are many viable methods for starting out without much money (a few of which I’ve covered on this very blog that have been incredibly popular, links at the end of the article if you’d like to check those out) but just understand that these are limited and will mean more time and work from you before you can build them up into a big business. Read More…
You have probably heard this phrase from me many, many times. And you’re sick of hearing it, because finding a profitable niche becomes more and more difficult and problematic as there are probably ten times more online businesses nowadays compared to say 10 years ago.
From the emails I receive from my blog readers I know that finding that perfect niche is one of the most difficult tasks for people who are just starting online. In many cases it’s because people simply struggle to think out of the box and can’t see anything beyond the usual phone accessories, designer clothing and video games.
But do you REALLY need to find a niche to make money on eBay?
That’s what I’m going to try and answer in today’s blog post.
What is a Niche?
For those of you who are new to the whole “selling online” game, let me explain how we use the term “niche”. You can probably find dozens of various definitions online but to put it simply:
“A niche based business is a business selling a specific product or group of products, targeting a specific customer profile”.
It simply means that you don’t sell EVERYTHING (like Amazon) but concentrate on specific product categories (possibly even single products) or customer profiles.
Just to give you some examples of typical niche businesses:
These are all classic examples of niche businesses. These companies sell a specific range of products targeting a specific customer profile. You won’t find video games on Big Dug’s website or designer clothing on CamLab.co.uk Read More…
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