Building Your Business How to Make Money on eBay What To Know To Start Selling on eBay By Ella Ames Ella Ames Ella Ames is a freelance writer and editor with a focus on personal finance and small business topics such startups, business financing, and entrepreneurship. She has a background in business journalism and her work has appeared not only on The Balance, but LendingTree, ValuePenguin, EE Times, PolicyMe, AllBusiness.com, and more. learn about our editorial policies Updated on June 30, 2022 Reviewed by Khadija Khartit Reviewed by Khadija Khartit Twitter Website Khadija Khartit is a strategy, investment, and funding expert, and an educator of fintech and strategic finance in top universities. She has been an investor, entrepreneur, and advisor for more than 25 years. She is a FINRA Series 7, 63, and 66 license holder. learn about our financial review board Fact checked by David Rubin Fact checked by David Rubin Facebook Instagram Twitter David J. Rubin is a fact checker for The Balance with more than 30 years in editing and publishing. The majority of his experience lies within the legal and financial spaces. At legal publisher Matthew Bender & Co./LexisNexis, he was a manager of R&D, programmer analyst, and senior copy editor. learn about our editorial policies Share Tweet Pin Email In This Article View All In This Article Create an Account Get Administratively Prepared Prepare For Your Listing Set the Right Price Optimize Your Listing Review Your Niche (or Lack Thereof) Streamline Wherever Possible Selling on eBay FAQs Photo: svetikd / Getty Images Selling items on eBay can be an effective way to bring in some extra cash. On your own terms, you'd sell things from your home, whether those things are related to your hobbies and interests or those things simply need to be done away with. Depending on how much time you're willing to commit to make online sales, selling on eBay can be a nice side hustle to bolster your rainy day fund or a full-time job if you find that you are really good at it. Let's discuss the nuts and bolts of how to make money on eBay, optimize your listing, and set yourself up for success. Key Takeaways You can simply create an account to “List an item" to start selling on eBay. eBay charges upfront and final value fees for listing items for sale and on each item that sells, respectively. Gather unused or unwanted items from around the house, such as books, to sell. You can gauge the true market value of an item on eBay by what it sells for, not its asking price. Optimize your eBay listing by choosing the right keywords, emphasizing item details like brand and color, and adding good, clear photos. Create an Account Before listing any goods, you must have an account with eBay to sell goods. Consider whether you need a personal account or a business account. Although the decision is ultimately up to you, you should consider operating with a business account if: You are reselling goods or dealing with bulk listings.You create the products you are listing on eBay and operate as a manufacturer.You manage large quantities of sales regularly. A business account may reduce the fees on your sales and generate better business exposure.You sell items that are not intended for personal use. A business account may reduce your taxes due.You are selling goods for someone else. A business account often allows users more flexibility in the quantity of postings. If you're not sure whether you need a business account or a personal account, you can always switch after your account has been created. Navigate to the 'My eBay ' tab, then select 'My Account' followed by 'Personal Information'. By clicking the 'Edit' button, you'll be able to change the account type and enter your business details when you're ready. eBay Business Account Pros You have a higher limit of listings per month. You have access to better tools and promotions. You're able to use your company name as your registered name. You get greater selling privileges in crisis situations. Cons Tax reporting is more complicated. You are required to report your eBay income as business income. You will need to keep detailed records of all transactions for taxes. Get Administratively Prepared There are several additional administrative items worth considering before you list your first item. When setting up your account, consider an appropriate eBay name that invokes trust. Set up a PayPal account in advance to ensure you can promptly receive payment when your first item sells. If you've never used eBay before, consider navigating the site, identifying an inexpensive item, and testing out the 'Buy' feature to see what a customer is going to experience. If you plan on listing your first items with "Buy Now" options, consider getting armed with shipping supplies before you list. You won't know how long it may take for your first item to be sold and if it goes quicker than you realize, you may be forced to make your very first customer wait as you gather what you need to ship the good. Prepare For Your Listing It's time to start selling! Gather items from around your house that you no longer want or use instead. It's time to do some research after you’ve collected a box of things to sell. Start the process by going to the “Selling” section of the website and hitting the blue “List an Item” button. You’ll be prompted to fill in your product's details, upload photos, and name an item's price and shipping rates, among other information. Before preparing your listing, consider navigating to this part of the website to better understand what information will be needed. After a while, you'll get a hang of what is needed; for your first listing, write down a list and gather the information before proceeding. Note A book is a good item for beginner sellers to start with. Its straightforward size and shape make the shipping process simple, and its price can often be easily determined by other postings. Set the Right Price Learning how to price your items is an important part of being a successful eBay seller. You can see how much similar goods are sold for by searching for the item on eBay and adjusting your settings to show sold listings. You shouldn't determine current market value by the selling price but by how much sellers are able to get for an item. You can also use other online selling platforms, such as Facebook Marketplace, OfferUp, Craigslist, Poshmark, and Nextdoor to gauge the right listing price. This may be straightforward if your item is common and standard (i.e. a specific book). If your item is more specific or unique, make a list of comparable items, how your product is similar or different, and adjust your pricing accordingly. Spend some extra time when researching how much to charge for more expensive items, such as antiques, art, or collectibles. You'll want to make sure you understand the item’s value before you list it so as not to sell yourself short. Sites like WorthPoint.com can help you to pinpoint an appropriate listing price. Optimize Your Listing As you create your listing, your goal is to make your listing as attractive as possible to potential buyers. Pay attention to what other sellers are doing, especially those who are generating sales. Whether it is offering free shipping or using specific keywords in their titles, there are always ways to gain an advantage in your eBay listing. Title eBay product listings have up to 80 characters. Your goal is to easily communicate what you are selling and have the consumer easily identify what the product is. Try to include two or three primary keywords in your title as well as descriptors such as brand name, color, size, product attributes, or product condition. Some product listing types also allow for a subtitle up to 55 characters for an additional fee. Note Shoppers may be used to using acronyms to scan product listings. Consider using terms such as "NWT" (new with tags) or "GUC" (good used condition) if space allows. Keywords Leading up to creating the product listing, spend some time researching what keywords best identify your product and drive search results. As you become more serious about selling, consider investing in SEO tools to help identify these search criteria. For your initial listings, check what phrases Google auto-completes as you search for your product, see what words similar listings use and analyze recent Google Trends data for search criteria. These keywords should be used throughout your title and product description. Don't plan on spending too much time on your description; try to find the balance of describing the good for sale without leaving any potential unanswered questions. Product identifiers and item specifics aren't required, but it's often best practice to include this information on your listing. By typing out information such as the condition, color, brand, ISBN, or UPC, buyers are likely to be driven by your listing should there be keyword matches. Photographs You're allowed up to 12 free photos per listing, so consider documenting your product from different angles or different spaces. This is the opportunity to also build trust with your clients by clearly displaying any defects or issues with your product. It's often advised that photos should be at least 500 pixels on its longest size. Ensure good lighting in a clutter-free environment, and be mindful that text or some artwork are not allowed in photos. You can also pick a stock photo to use using the eBay product catalog. Shipping/Returns eBay's fast shipping program 'eBay Fast 'N Free' is designated on a listing by a prominent tag. If you plan on shipping your product quickly anyways, these types of listings attract buyers and invoke confidence in your sales as Fast 'N Free products are guaranteed by eBay. As the seller, you're allowed to set whatever return policy you want. Be honest about whether you're willing to accept returns, being mindful that customers may choose a different seller (with even a higher price) for the flexibility of a return. You can set a return period (i.e. the buyer is allowed to return the product within 14 calendar days of the receipt of payment). Note Avoid the common beginner mistake of listing your item in the wrong category. Your listing may not receive any traffic if left up or removed by eBay should the posting be reported. Review Your Niche (or Lack Thereof) Some sellers might prefer the focus and direction that a niche market provides, but don’t worry too much about finding one. When getting accustomed to eBay, consider selling what you can to learn about how the marketplace work and what it's like partnering with customers. In time, you may naturally find you prefer selling certain types of goods or working with certain types of customers. It can seem daunting at first, but you’ll acquire an eye for what buyers want as you become more experienced. Even when you're not selling, consider having the eBay (and other marketplace) apps on your phone so you can check the value of the items and teach yourself what to look for when you’re at garage sales, thrift stores, or antiques shops and shows. Streamline Wherever Possible After you've completed several sales, it's time to review how things and gone and come up with ways to improve. Identify areas where you can make the process simpler. Even the smallest changes to make things a little quicker can add up and save you a considerable amount of time in the long run. Ask yourself the following questions: Is it faster to take photos and list items using your smartphone? Would the change in quality be noticeable?Can you have a dedicated shipping station set up in your home so you don’t have to move things around or gather supplies every time you need to send a package? Is there a more efficient way of gathering information (i.e. using stock photos, using specific sources for UPC numbers).How have your client interactions gone? Have you responded to inquiries quickly, and what would make customer service easier? Note eBay charges “insertion” or upfront fees for placing items for sale and final-value fees for items that sell. As you sell products, understand how the gross proceeds differ from these net amounts you receive. You can create templates ahead of time if you consistently use certain words in your listings. If you decide to pursue a specific niche, think of how a single post can relate to others and attempt to replicate a successful listing. If you've noticed that certain layouts, keywords, or listing features have driven more success, leverage those in other listings. How Do I Offer Free Shipping on eBay and Still Make Money? You’ll want to incorporate the cost of shipping into the price of the item if you're offering buyers free shipping. You can get custom shipping and packaging recommendations from eBay as well. You can estimate shipping costs using eBay’s shipping calculator. Is it Easy to Make Money Selling on eBay? Be prepared for a learning curve when you first start selling on eBay. After a while, you’ll get the hang of where to find products, how to price your inventory, write listings, and ship items. You’ll likely find that selling on eBay can be an effective way to make money on your own terms once you get comfortable with the process. How Much Money Can You Make on eBay Before You Have to Pay Taxes? How much tax you have to pay depends on how you’re using eBay. You might not need to pay any tax if you’re selling casually in the same manner that you would if you were having a garage sale. This is often the case with person accounts.You'll have to report your earnings to the IRS if selling on eBay is an actual business for you and/or you begin bringing in even moderate money. You should receive a copy of a 1099-K form reporting your earnings to the IRS if your gross sales on eBay are more than $600 for the year as of 2022. This is a decrease from $20,000 in sales and 200 transactions in 2021. Was this page helpful? Thanks for your feedback! Tell us why! Other Submit Sources The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy. eBay. "eBay Now Guarantees Fast 'N Free Shipments." eBay. "Selling Fees."