Running an eBay Business

Just because you are operating a business in the "virtual" world does not make your business any less real. Regardless of location their are a number of laws that you have to be aware of because your eBay business will be expected to comply by them.

Creating a business plan: Your business plan should be the first step for any type of business venture. For your business to be a success you should have the dedication to work hard and be passionate about selling your products to customer. Good sellers are those that are proactive and willing to go the extra mile, because they enjoy what they do, if you are just looking to get rich quick, then eBay is not for you. Selling on eBay could take several years and many long hours before your business starts to bring in enough income to stay afloat.

Research the market: Before investing every dollar you have into buying random products on eBay, do market research. If you have a passion for collecting and finding antique items or another collectible, you should spend time collecting data on product trends, pricing and demand. The more information you have on what eBay buyers are looking for the more you can focus your shop and finding the items that you know will sell.

Contact local authorities: If you are going to be operating your eBay company from your home local zoning ordinances may come into play, most areas have restrictions on where a business can operate and by opening a retail business in your home you could be in violation.

Registering your business: Operating a store on eBay means you are running a commercial enterprise and as such, your business has to registered locally. You can choose to set your business up as a limited liability if you are in a partnership or sole proprietorship if you are the only one running the business. You should also request a federal tax ID number and register for all state and local taxes.

If you have no experience and need assistance with understanding how to register your business you can contact your local camber of commerce. The services of a business lawyer and accountant can also help explain the process.

Keep your business separate: Personal and business accounts should not be mixed set up a business account to avoid problems with tracking and paying income taxes at the end of the year. All profits from your eBay business must be reported on income taxes and when selling to buyers who live in your state you are required to pay state taxes on their purchases.

Get organized: If you are operating your business from your home, set up an office in an unused room and make sure you invest in the equipment needed to run an eBay business including a scanner, quality digital camera, updated computer and high-speed internet access. Setting up a separate email account to only handle messages from buyers on the site can also make you look more professional and reassures your buyers that your busy can be trusted.