eBay "To Go": Franchisors mine new no-hassle niche selling on eBay

No one can question the mammoth success that eBay has experienced over the past decade. It's the virtual place where one person's junk becomes another's treasure. Consider this: In 2003, nearly $24 billion worth of merchandise changed hands through eBay. That's more than $65 million in sales every day. In fact, it's estimated that eBay provides a marketing platform for more than half a million Internet entrepreneurs.

Once again, the franchise industry has found a way to get in on the action. Witness the growth of eBay "drop-off" or consignment stores. These businesses have found a way to provide a locally based channel for selling goods on behalf of others who are too busy (or too computer-shy) to sell directly on eBay. The stores allow customers to offer all kinds of items for sale, from automobiles to antiques to jewelry.

At least a dozen franchise-based companies have sprung up to serve this thriving online market, including: QuikDrop, QuickSELLit, iSold It, eAuction Traders, FoundValue, The Online Outpost, eAuction Depot, and more.

These drop-off franchises charge a fee to take over the online marketing and selling of the products. They have the resources to create attention-grabbing auction listings and handle all questions from would-be buyers. The stores list the goods for sale and provide all necessary information for buyers. When the auction ends, the drop-off franchise takes care of payment, packages the item, and sends it off to the new owner.

iSold It is one of the larger U.S. drop off franchises. The company is expecting to open 300 stores by the end of this year, with merchandise sales topping $100 million. Kenneth Sully, iSold It's president and CEO, says, "Now more than ever, consumers and businesses are using drop-off stores such as iSold It and realizing how our service can benefit them financially. We're bridging the gap between brick-and-mortar retailing and Internet retailing, then providing access for consumers to sell instead of buy."

Drop-off franchises usually require storing all items in secure warehouses in or near the drop-off locations. These fully insured warehouses protect both the franchisee and the customer against possible loss or damage.

Many drop-off businesses offer customers the chance to re-list their items for free if they do not sell the first time; and, if the seller wishes, they can even donate unsold items to charity. In fact, a growing number of drop-off franchises offer services to directly raise money for good causes.

As with any franchise, make sure you fully research the local market before laying out capital for the venture. Look for competitors in the area. It's also a good idea to have some experience and knowledge of eBay, and how to develop successful listings that will generate strong sales. And of course you'll need access to a reliable and secure computer system and ISP.

Commissions can vary, but drop-off franchises can demand anything from 20 to 40 percent for helping sell customers' goods. To many people, time is money, so they are willing to pay fees to ensure their items get sold-especially if it saves them time.

Published: November 9th, 2006

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