Traditional storefronts aren’t your only retail option. Here’s a crash course in the fastest ways to start selling.
Forget what you’ve heard about retail businesses requiring tens of thousands of dollars, long-term lease agreements and several months to get up and running. The truth is, there are plenty of retail opportunities that break all those rules, requiring little time or money to start. From online storefronts to mall-based kiosks to shop-at-home events, we found several retail businesses with plenty of profit potential.
The Latest Retail Phenomenon
When Randall Pinson took a full-time job as manager of a cell phone store during college, he expected to earn some extra money for school. He didn’t expect to learn how to start an online retail business that would ultimately support him and his family.
Pinson, 29, had only vaguely heard of eBay in the spring of 2000, when his boss asked him to try to sell some phones on the website. So he followed the step-by-step instructions on eBay.com and listed a shipment of phones for sale. Less than an hour later, a woman in New York offered to buy 15 of the phones for $125 each, making Pinson’s employer $100 in profit on each phone.
The 400 percent markup the store earned got Pinson’s attention. He started selling cell phones and accessories on eBay himself on a part-time basis, and in 2002, he quit his job at the cell phone store and started his own online business using his last paycheck and a $2,000 American Express line of credit. By his college graduation a few months later, he was earning close to $60,000 a year selling on eBay.
Always aiming for a 50 percent markup on his sales, Pinson (eBay User ID: rocket-auctions) occasionally does much better. “My most profitable eBay sale was a piece of telecom equipment I bought for $5 without really knowing what it was. I sold it for $750.”
Five years after starting, Pinson says confidently, “Anyone can make a living on eBay.” His company, Rocket Auctions, based in Farmington, Utah, generated $400,000 in sales in 2005, with 2006 projections of $500,000.
To bring in that kind of money, Pinson has one full-time employee who handles the day-to-day logistics of inventory management and shipping the 400 or so items that are sold in completed auctions from the company’s warehouse each week.
One of the advantages of starting an online retail business is that you can ease into it-you can easily try it out before committing, with little risk or expense. Dennis L. Prince, author of How to Sell Anything on eBay… and Make a Fortune!, recommends first taking a weekend and gathering items you have around the house, because “everyone has $3,000 to $5,000 worth of [merchandise] at their feet they want to get rid of,” he says.
Then research what you’ve got by reviewing completed eBay auctions in the Seller area of the site for the product category you want to sell in.
Although the process of selling on eBay is extremely easy, selling stra-tegically and successfully can be hard work–“more work than you realize,” says Prince, who has made several hundred thousand dollars on eBay in the last 11 years by selling in his spare time. Sole proprietors can make as much as $5,000 to $10,000 a month, Prince says. If you bring in employees, those numbers can grow substantially.
Says Prince, “An online business [has] the lowest cost and potentially highest yield for a retail startup.”