How To Value and Price an Item You Want To Sell On eBay [and Other Online Marketplaces]


Posted

in

by

price an item for resell
Photo by Markus Spiske on Unsplash

If you are new to selling on eBay, Mecari, Etsy, Poshmark, or any one of the other online marketplaces, one of the hardest things to do is placing the right price on an item you want to resell for a profit.

For example, if you price an item too high, it might sit on your shelf for a long period of time and never sell. If you price an item too low, it might sell an hour after you list it for sale and you might be thinking “Dang, I should have listed it for more money.”

Every category and every type of product you pick up for resale are all different for figuring out the type of pricing strategy you want to implement.

In most cases, it will be harder than you think to master a pricing strategy that will balance out profit and the time it takes to move a product sale to a customer!

But, given enough time and experience, eventually, in a short amount of time, every reseller can master a product pricing strategy that will balance out with netting the highest possible profits for their items.

With that out of the way, let’s get into how to look up values on eBay and properly price the items we want to sell.

First Things First: Remember! Looking At The Most Recent eBay Sales Comps Is Not Always Going To Work

Even if you know how to look up sold comps on eBay, it will be very hard to value most items you want to flip for a profit if you have no experience with that particular item.

When you have no experience with a particular type of item, it’s very common that you overpay when sourcing the item, and then you list the item for a higher price than what a customer will actually want to pay.

The end result is you have a ton of listings on eBay, Mercari, Poshmark, or Etsy that never move into a sale. After a while, you lower the price, then, lower the price even more, and still have no movement whatsoever.

Then, those items eventually get so cheap, it’s not worth even selling them and you’re better off donating them to the thrift store.

And, this all happens after you verified the sold comps on eBay and you priced your items for a similar number that other exact products sold for!

Why does this happen?

Well, the simple answer is that sometimes a past sold price for a particular item is not the price it will get today. Even if that recent price is from 2 weeks ago or 2 months ago!

Some items that you end up listing for sale are in super-saturated markets that are all on a slow race to the bottom. After you list your item for sale, another seller will list your exact product for a little bit cheaper, so they can move it for a sale.

The reason the other seller is listing their item cheaper is because they understand that for certain types of products, buyers will always search, then sort by the lowest price first.

Meanwhile, you’re busy listing other items and forget about that item.

Then a few months later you realize you have a bunch of things for sale that are not moving, so you start checking your various item’s prices again and realize that prices are way cheaper than you remember. (These cheaper prices are ultimately why you are stuck with these items.)

The items I’ve had this bad experience with over and over again include categories like Video Games, Blu-Rays, DVDs, VHS Tapes, Books, Knick Knacks, New Old Stock Merchandise, Board Games, Various Hand Tools, and just about every other household product or mass produced collectible you can think of.

So the bottom line is this: You need to have experience with your products so you know how strong the demand is for that product so you can price it competitively knowing it will sell in a reasonable amount of time. As you gain experience, you’ll know how strong the trend is and if it’s going up or down. If the trend is going down, always price your item to be the cheapest so you can get a quicker sale. If you don’t like the idea of selling an item for the cheapest price, then you need to deal with products that people are willing to pay a higher price for which are not mass-produced or in a downward trend. Figuring this all out will not be easy!

What I Learned Actually Works When Valuing an Item You Want To Flip (Using eBay Sold Comps)

When I’m evaluating an item to resell, I like to ask myself a few things upfront before I price and list it for sale.

  1. Is the item rare or hard to find?
  1. How strong is the demand for the item I am selling?
  1. What is the lowest and highest sold price range?

NOTE: The following pricing strategy could be utilized on other marketplaces like Amazon as well, by researching the competition. However, since eBay is the largest marketplace (aside from Amazon) for reselling new and used items, most people set their prices by comparing to eBay, even if they are selling on Mercari, Etsy, OfferUp, Craigslist, etc

By using the eBay sold comps the right way, you can easily learn the answers to the questions presented above.

An example of what I do to value an item I don’t know much about is the following:

Say I am selling a DVD movie (or any other mass-produced item) on eBay. The first thing I do is scan the barcode, and then look at the active listings that show up. If there is no barcode, then just do a keyword search.

Next, I’ll then immediately go into the filter options and note the number of listings to filter, if that number is less than 5 or 10, the item would be considered “hard to find” in my opinion. If the number of available listings is more than 25 or 50, it’s pretty readily available.

If there are more than 100 listings of that item for sale, which is the common case for many DVDs, that means it’s extremely common and it’s not looking good for being a very valuable item to resell.

Next, I’ll sort the listing by the lowest price first. If I see a low starting price of 3 or 4 dollars with free shipping, I know it will not be a good DVD movie to list for sale, regardless of the condition of the movie.

There is just no money to be made here. If you try and list this movie at a price of 10 dollars, you most likely will wait a very long time for the sale, or in most cases it will never sell!

In fact, when you sort the active listings by low to high and see a very low starting price of just a few bucks, a lot of times I don’t even need to use the sold listings filter option to know this is a bad DVD to list for sale. The same is true for CDs, Books, Trading Cards, or any other mass-produced product or collectible.

My Final Decision and Assessment of Value For Selling This DVD Would Be The Following

Overall, in my opinion, there is just too much competition and that DVD movie is not hard to find at all. In fact, the market is saturated and everyone is pricing to the bottom of the market. I’d bulk that DVD into a box and do a large sale of discounted DVD movies in one lot.

Let’s Look Up Another DVD Movie

Now, say I look up another DVD movie, using the same look-up method I just described previously. If this DVD movie has only 10 listings and a low starting price of 10 to 20 dollars, it will most certainly be worth my time.

From there I’ll go ahead and click on sold listings just to make sure.

A lot of times I’ll see sold listings that will match the price range and I’ll price that DVD movie somewhere between the 10 to 20 dollar range depending on the DVD’s overall condition.

NOTE: In this example, I just provided for DVDs, a 10 or 20 dollar sale might not be too bad for a hobby side business on eBay. However, if you are trying to do this full time, you’d want to mostly focus on higher value items of 30 dollars or more. So with that said, you would probably be better off not even considering DVDs as a product to resell.

IMPORTANT! Pay Attention To The Sale Through Rate

Another statistic to pay attention to for an item you want to resell is the sold-through rate for your item.

When you look up your item, if you see 100 active listings but only 1 or 5 items actually sold when you filter the sold listings, that would be an item that is saturated and will probably go at a very low price.

Versus, an item that has 100 listings and has 50 that sold recently, here’s why!

An item that sells 5 out of 100 is only a 5% sold-through rate vs. 50 out of 100 listings is a 50% sale-through rate which will prove to have much more demand.

To learn a more technical definition of what a sales-through rate is, check this article out:

Indeed: What is Sell-Through Rate?

Practice Make Perfect, Selling Experience Is Very Important For Success

Remember, practice makes perfect!

I recommend you spend a lot of time sourcing and looking up certain types of products that interest you when starting out. If you are flipping items you already collect or buy regularly, you’ll have a good shot of becoming an expert for selling that product much quicker than another type of product.

And guess what will happen when you become an expert? You might come to the conclusion that the product you are trying to profit from is not worth your time, from a business perspective. 

Or you might discover a home run and double or triple down on it to maximize your profits!

Lastly, depending on whether you are doing online reselling as a hobby or side hustle, don’t be afraid to expand into other categories for products and items that might be more of a profit maker for your time.

I’ve changed categories all the time, even if the products are not my passion or hobby.

Final Thoughts

There are a lot of ways to interpret the marketplace and what to price an item at for your type of product. So get as much experience as you can by specializing in a few different categories when starting out. Once you can move items regularly and for a decent profit, feel free to branch out to other categories.

The biggest takeaway of being an expert at valuing and pricing items you want to flip for a profit is that you’ll know what price you should be paying to source the item, and what price you’ll need to list it for to maximize your profit, while still moving the item for a quick sale.

Then, you can avoid having hundreds of items sitting around, filling up your storage space, and not making any money for you!

Comments

One response to “How To Value and Price an Item You Want To Sell On eBay [and Other Online Marketplaces]”

  1. Personal Finance Geeks Avatar

    I agree, most buyers choose the cheapest price but if the buyer knows the value of the item it will surely buy even if it costs a bit expensive.

Leave a Reply

Your email address will not be published. Required fields are marked *