This is it – our last Questions & Answers blog post for this year! 🙂
Over the course of 2015 you have sent in more than 300 questions and at least half of them have been published in the 35 instalments of our Questions & Answers blog posts.
If you didn’t already know – you can find links to ALL previous Q&A posts on my blog’s archive page here. There you’ll also find links to ALL posts that have ever been published on this blog (250+ and counting).
I’m so happy that I stuck to my goal of reaching 50 Q&A posts this year and even though everyone is busy with Christmas, I still received a few questions over the last week to cover in today’s post:
- How to make good profit on eBay selling cheap items?
- Do you do paid reviews Andrew?
- Is the flat rate VAT scheme best for eBay sellers?
- How to add your physical shop to Google Maps?
- How to put text right next to the product image in eBay listings?
Without further ado, let’s get started!
I’ve been reading a lot of articles on your blog, and really felt that I could make something of a small business. I have barely any spare money so I was hoping that selling some small items for a few months would enable me to get a little bit more money to put back into the business.
As it is, I’m actually losing money on the first ‘stock’ item I’m listing! I’m crushed. I was working towards TSR status as you said – and I was willing to ‘pay’ for this by not making much on items at first, but with eBay fees, PayPal fees, postage and packaging, and original product price, I’m making 68p. Not even including the domain I have for £8 a month for the business email.
The breakdown of the product I have atm is as follows:
Buy for: 99p
Sell for: £3.50 (the going rate) +free P+P (as advised)
P+P: 39p (packaging) + 50p (post)
eBay list fee: 26p
eBay final value fee: 32p
PayPal fees: 32p
Profit = 72p.
Yes I could reduce the packaging cost by using different jiffy bags, but that’s still a profit of about 90p on each item. I cannot foresee snowballing a business in this way. Do you have any advice, or should I just pack it in?
You may not realise it but you’re actually doing very well! Making 72p profit on an item you sell for just £3.50 on eBay – that’s actually considered a very good profit margin.
That means that you’re making 100%+ return on your investment, if your product purchase cost is 99p. And that’s an excellent profit margin on eBay!
You just need to work towards getting Top rated seller status (which by the way will further reduce your eBay fees) and expand your product range to dozens, and in the future – hundreds of product lines. Then you can turn these cheap items into a full time business.
I am writing to you because I think your blog is great and you seem to have a very large following.
I have a product which I originally invented for my son and then realised it has potential to sell to other families so I have patented it and am now about to start manufacturing. I don’t know if you do this or not, but what if I sent you a free sample of the product so you could try it for yourself. If you like it and agree that it works, I would pay you to write a nice blog about the brand new product. I know bloggers do this, just not sure if you do as well. Please let me know.
It’s great to hear that you have invented & even patented a new product. That’s awesome!
But I’m afraid I can’t do such paid blog reviews. It’s just something I don’t and never will do. I only write about products/services that are related to online/eBay/eCommerce businesses that I have personally have found useful and valuable in my business.
Good luck with the product anyway!
I hope you don’t mind me contacting you but I’ve been an avid reader of your blog for a while now and after starting our online retail business 6 months ago, we are coming up to the VAT threshold in the next few weeks and I wanted to pick your brains on a very specific query that I’m hoping you might have some personal experience in.
We are taking the advice on your site and going for the Flat Rate Scheme, as it seems like the most tax efficient way after taking everything into account.
My query relates to the VAT we currently pay on incoming air stock shipments from China.
As I’m sure you’re aware, the VAT is estimated by customs (I guess simply on weight and appearance) and we always end up underpaying the VAT, sometimes quite substantially. My question is, simply, will this be an issue once we register for the VAT Flat Rate Scheme?
Is it a non-issue or do we somehow have to top up the outstanding VAT when custom’s estimation comes out at under 20%?
I did discuss this with our accountant but he doesn’t seem hugely clued up on the ins and outs of VAT and initially advised us against the Flat Rate Scheme so I thought it’d be wise to get an opinion of someone directly in the business.
VAT seems like such a daunting step for our business (one step forward, two steps back comes to mind) and this is really the last thing I need to figure out before proceeding so any help would be greatly appreciated.
Thanks in advance.
The first thing I want to say is that it’s simply unbelievable how under-qualified some accountants can be. You’re not the first person to write asking for advice on an accounting topic, saying that their accountant has no clue about how it works. And to me thatís just crazy as it’s what they’re paid to do!
I’m not an accountant (far from it) but even I have a better understanding on how these things work.
So advice number one – find a better accountant.
Secondly, the VAT you have paid on previous imports – VAT is NOT calculated on weight or appearance of the goods/packages you import. VAT is calculated on the VALUE of your order! I.e. the price you paid for those goods to your supplier in China (or whichever country). So if your orders have been undervalued and you’ve paid less VAT than you should have done, this is most likely because your supplier put a smaller value on the customs declaration.
To avoid this happening in the future, always ask/remind your supplier to attach the REAL invoice to your order, showing the correct value of the goods and shipping, so that customs can properly calculate your due taxes.
Lastly – if you sign-up for the flat rate VAT scheme, you’ll pay 7.5% VAT on your turnover (sales) BUT you won’t be able to claim ANY VAT back on purchases (including the VAT you’ll pay on imported goods).
Whether or not this is the right decision for your business depends entirely on your numbers. An accountant should really look at your expenses and calculate how much VAT you can claim back, and how that relates to the VAT you’ll pay on sales. Only then can you make an informed decision, and it really is necessary for either you or your accountant to take a proper look at the figures.
Hope this helps!
My wife and I recently discovered your website and we love your tutorials! My wife thinks of you as the don of the internet, and eBay in particular.
We were hoping to get your advice on something, even though it isn’t directly related to eBay (though we do plan to expand on to their soon, with the help of all your tutorials!).
My wife opened a prom dress shop about 6 months ago but no matter what we do, we can’t seem to get on Google Maps as a large “handbag” type icon.
We’ve obviously registered with them as a business, and we had the postcard sent to our actual shop address, but still if you search for prom shops in the area we don’t show up! At most we have a little red dot despite having filled in a Google Plus profile and checking the right boxes about being an actual shop rather than someone who just delivers around this area.
We thought it could be because we don’t have any reviews but then we noticed that other featured stores don’t have any either, so it can’t just be that.
If you do have the answer, that would be brilliant!
Even if you can only point us in the right direction so that we are one step closer to sorting this, as we did try ringing Google but they only seemed interested in us paying them money to advertise but I don’t think these other stores have paid to be shown on Google Maps.
Sorry to have taken up so much of your time and I hope you can help us.
Steve and Alison
Hi Steve and Alison,
The verification process DOES NOT guarantee that your shop will actually appear on the map.
It’s Google’s algorithm that determines which shops they show and which they don’t. This is mostly related to your websiteís rankings in Google – meaning if your website ranks in the top positions for those keywords, they will show on the map too.
So what you really need to do is work more on your shop’s SEO – get your website ranked higher in search results and then you have a chance of Google adding your info to their map as well.
I can’t figure out how best to insert text next to a picture, what would you recommend? At present, each picture occupies an entire line. Would I need to create a jpeg of the text using paint or something similar and insert it like that?
Also I can’t seem to enter a valid URL for the gallery picture. I’ve tried using both the link and embed URL’s from Picassa web albums, which work fine in the html, but neither is recognised as a gallery picture by Turbo Lister.
There are two ways to do this:
1) Yes, you could create an image with TEXT already on one side. The downside to this is that it’s technically against eBay’s rules (eBay does not allow description text to be an image file) plus it may look bad from a formatting point of view, as it won’t match properly with the rest of your description text.
IF you just need to add a few words/specs, you can do it this way but if it’s a paragraph of text, you need to use method no. 2.
2) The second option would be to include a table with 2 rows and 2 columns so you can use one side for the image and the other side for text. You can use an online table generator to get this done, like this one:
Make sure you set correct sizes, borders with no colour, and no background colour – so essentially this table won’t be visible to your customers and it just acts as the layout to format your text right next to the image.
As for gallery images – you don’t have to host them on your own! Upload them to eBay as they don’t charge for gallery images anymore. There’s one small trick you need to use to make this work though:
Hope this helps & Merry Christmas! 🙂
Okay, thatís it for today.
Even though I’m going silent on the blog for a few weeks now, you can still keep sending in your questions via the contact page here to get them featured in the first Q&A post of 2016 – in the 2nd week of January!