eBay has built a fantastic ecosystem unmatched by anything out there. From used to new goods, it’s a place to find almost anything you are looking for and it has been successful by building a cult following among buyers and sellers.
If you’re a seller, you know margins on eBay are razor thin. What might sell in a retail store or online that would get you 25% + mark up, would fetch barely 10-15% selling through the eBay system.
If you’re a buyer, you know you can find almost anything you want at a cheaper price. You just have to make sure you’re buying from a reputable seller and you get what you expect to receive.
Traditional retailers list on eBay to reach markets they typically might not reach. Some do it to learn and stay in touch with the market while making a few extra bucks. Although there is some encroachment on traditional retail or online e-commerce sales, overall it doesn’t cannibalize those distribution methods, but instead keeps downward pressure on retail pricing.
Individual sellers list because they can earn money on the side while keeping prices sharp based on low overhead.
Overall, the competition and selection helps keep selling prices down on eBay and the buyers coming back.
So how does a seller make more money from a listing? You can’t raise prices and hope to get more sales, because eBay is all about low pricing. You can make yourself more efficient, try to cut costs and build a good reputation for service…but so tries everyone else. For any retailer, whether on eBay or not, maintaining margins is critical. With price competition keeping a lid on prices, where can a retailer unlock new sources?
As a company, we’ve found a way to do this and support eBay and Amazon Marketplace sellers. Let’s explain.
If you look on eBay on almost anything sold with a plug, you’ll find additional warranty options for purchase. These warranty options provide a protection guarantee in case the item you purchase from the eBay seller fails. This gives great comfort to a buyer on used goods or when purchasing from someone they don’t necessarily trust or who may have a limited return policy.
Most goods don’t come with a manufacturer warranty when sold on eBay. New goods don’t always come with a manufacturer warranty if imported from out of country, or sold outside normally approved channels, or in the case of used goods, may not have any warranty at all. To alleviate this, eBay offers additional warranty coverage options through their partners Square Trade and Best Buy Geek Squad.
This is done as a requirement of eBay, whether the seller wants to or not. As for eBay rules, all sellers in eligible categories are listed with an extended warranty if they meet the following criteria:
“Items in eligible Electronics and Home & Garden categories on eBay.com
(see http://pages.ebay.com/sellerinformation/news/warranties.html for more details on eBay warranties)
On any warranties sold, sellers are rewarded anywhere from 10%-40% of the selling price.
This may sound like an effortless revenue stream, but this is built on a sliding scale and produces almost nothing for the seller. In some eBay businesses we have direct experience with, after selling 10,000 items, less then $100 was given as the seller share. This was for a retailer who had what is considered a good attachment rate for warranties on devices valued at an average of $200. In the warranty space, this should be considered very low.
Why so low? Most of the profit is kept by eBay and their warranty partners.
Warranty Life has now launched a new program that gives sellers a chance to take this revenue back into their own hands by offering eBay sellers the ability to embed warranties in their listings.
For example, instead of selling an iPhone 4 for a buy it now price of $310 and no seller warranty, Warranty Life will allow the seller to embed a warranty with that product. The list price gets boosted to $350 but now includes a one year warranty . This builds added trust for the buyer, while earning the seller additional profit margin, doubling what is usually earned and often times earning a premium over what the product might already sell for.
So instead of fetching $310, the seller fetches $320 just for the phone, plus the $40 for the warranty, earning potentially $60 in additional revenue and $30 more profit on the entire sale. Here, the buyer is willing to pay more because the product is sold by a seller who backs his product and is further backed by a company who has authorized the seller to sell warranties from Warranty Life.
Warranty Life has already proven this system to work. Sellers on eBay are doing this now. After selling hundreds of items on eBay with warranties embedded, we’ve not only shown that an embedded warranty sells an item just as fast, it recovers the full warranty price plus a premium on the actual item sold. Out of the hundreds of listings sold, we did not have one that did not sell on time and for extra profit.
In fact, applying a warranty to it helped sell inventory that was typically difficult to move. Not only did those items sell over the competition, but they sold for more money and faster. Competitors with no warranty were left with unsold items.
To date, warranty sale opportunities have been restricted to only the largest retailers. Warranty Life has opened up access to warranty or protection service plans to all sizes of retailers, with no minimums required and a system that works.
With no cost sign up and an easy to use system, sellers on eBay or outside eBay, can get up and running within minutes.
“We encourage sellers to try it. For no cost, sellers can begin listing eligible products with embedded warranties on eBay or Amazon Marketplace. You’ll find that items will sell just as fast and get positive comments from buyers about the new features being offered. Sellers decide what warranties to apply, we even have accidental coverage for new and used items that you can begin offering.
We’re also happy to work with sellers to develop strategies and recommendations on what to offer and what content to display, it’s really a great opportunity to double your income.
I’ve personally owned three e-commerce businesses and sold tens of thousands of items on eBay, I know how to help others sell and I know this works. We’ve spent a great deal of time and effort perfecting the system we can now offer it on a large scale. Look for more Warranty Life powered eBay sellers in the coming months.” , says President & CEO Richard Hui.
Warranty plans are available on any electronics, furniture, garden tools and musical instruments. Coverage options range from one to five years and can include accidental damage protection, a popular product for mobile devices like cell phones, tablets and lap tops on used, new and refurbished devices.
Becoming a seller is free and only takes only a few minutes, go to https://www.warrantylife.com/partner/info for more details. Start today!