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The Honolulu Advertiser
Posted on: Wednesday, July 6, 2005

EBay sellers immersed in careers

By Leslie Walker
Washington Post

WASHINGTON — Brenda Lorisch is considering buying a new home and keeping her old one to store the mountain of designer clothes she sells on eBay.

Asad Bangash and Jody Rogers of Orlando, Fla., use a backyard apartment to store thousands of shoes and bangles they import. Clutter is one of the biggest challenges for online entrepreneurs.

Asad Bangash via Washington Post

"We have a 2,600-square-foot house with three bedrooms, but only one bedroom we can sleep in," the Houston entrepreneur said with a laugh. "But my husband doesn't complain any more because I make more money than he does."

Candance Mahlendorf sells collectibles from her home in Fremont, Neb., and struggles with the same issue. "We have five bedrooms, and three out of five are all eBay. Now my husband insists that all our eBay stuff goes right into the three bedrooms the moment it comes in the house," she said.

Their challenges pale beside those facing William Bowman and Sabrina Morales, who sell exotic woods from their two-bedroom apartment in Harrisonburg, Va. "The only room in the house that does not have product is the bathroom," said William Bowman. "That is no lie."

Clutter is one of many thorns prickling the horde of Internet entrepreneurs angling to strike it rich on eBay, the global online bazaar featuring 50 million items for sale every day. There is also the loneliness of working from home, the tedium of photographing hundreds of items, the grind of answering customer e-mails and the anxiety over competing with other eBay sellers who regularly pop up out of nowhere.

Overcoming obstacles

The challenges are intensifying as Web commerce and its biggest player, eBay, turn 10 this year. What started as a hobby for many has overtaken careers and personal lives, transforming them as a new form of commerce takes shape online. Now that thousands of eBay entrepreneurs have years of selling under their belts, they are wrestling with serious issues of scale.

"We have gone from a minivan to a full-size cargo van to a FedEx delivery truck," said Mark Anthony, a Phoenix entrepreneur who has been selling model car kits on eBay for five years. Anthony stores 9,000 to 11,000 model car kits in and around the large house he bought when he started on eBay.

Yet he still loves the lifestyle, he said. "It's kind of like having a garden: You go out in the morning and pick out some stuff to sell that day, whatever you feel like depending on your mood."

EBay dealers tend to go through a predictable evolution. They start selling junk lying around the house, branch out to buy inventory wholesale either online or from local stores, then really ramp up once they find a product that clicks with the site's bargain shoppers. Most sellers work solo or with spouses at home, at least until sales hit $10,000 or $15,000 a month, because the cost of hiring staff and renting space would gobble up any profits.

Eventually, high-volume sellers often buy a small warehouse or storage barn and drop it in their backyards, or rent one in town to not only hold inventory, but provide office space. They hire part-timers to help pack the oodles of stuff they ship to buyers around the world.

Join the sales club

All told, eBay reports more than 100,000 merchants belong to its multitiered "power-seller" group, which requires sales of at least $1,000 a month and carries various perks. The color-coded levels of the sales club start at bronze and progress to titanium, which requires monthly sales of $150,000. That sounds like a lot, but remember, actual profits are a fraction of sales.

Phoenix entrepreneur Mark Anthony, shown at the eBay convention in San Jose, Calif., has been selling model car kits on eBay for five years. He has gone from a minivan to a FedEx delivery truck, he said.

Leslie Walker • Washington Post

Gary Richardson is a typical early stage power-seller, hawking Harley-Davidson sunglasses from his home atop a rural mountain in Locus Grove, Ark., for the past two years. He works full time as an industrial refrigeration technician, but with his eBay sales doubling monthly, he is hoping to quit soon. He has attained "silver" sales status, meaning his eBay revenue exceeds $3,000 a month.

Also at the silver level are Jody Rogers and Asad Bangash, both 31, who sell an unusual product you won't find elsewhere: khussa sandals handmade in Pakistan by a man who develops the designs by phone with Rogers. She and Bangash — who go by "beachcombers!" on eBay — were working for car dealerships before the Internet bug bit them. Now they work side by side, six days a week, in a backyard apartment behind their house in Orlando, Fla.

"While my income has gone down, I have never been happier," Rogers said. "I own my own business and I make my own hours."

Rogers believes her business will eventually take off, even though eBay millionaires likely represent a tiny fraction of the 430,000 people earning income selling on the site.

Unique lifestyle

But the prospect of wealth does not appear to be the primary motivator for most. Rather, it's about calling the shots.

"After years in the corporate world with people breathing over your back, this is the perfect job for me," said Emily Sabako of San Marcos, Calif., who quit her post as a chief financial officer to spend more time with her two young children and now sells Mary Frances handbags on eBay. "Where else can you work in jeans and bare feet, have the blues on in the background and be drinking your iced tea?"

After four years, Sabako, 46, has reached the "gold" level, grossing more than $10,000 a month.

Angela Cash of Kennesaw, Ga., is on the ladder's next rung, a platinum seller with monthly sales over $25,000. She finally bought a warehouse last year to support her home-decor business, which employs two full-timers and eight part-timers. "I'm what happens when your eBay business gets out of hand," she said.

EBay won't say how many sellers have hit the platinum or titanium levels. Nor is much data available on how many of the site's 60 million active users are sellers. In 2003, the most recent year eBay conducted a major survey of its users, the company estimated there were nearly 4 million sellers on eBay in the United States. Nearly 120,000 were using the site as their primary or only source of income; an additional 310,000 used it as a secondary sales channel, the survey concluded.

EBay dealers are quick to tell you their Internet businesses can be turbulent, even on the upper rungs of the sales ladder.

"Last year was horrendous for me; my business sagged," said Mike Lazar, a Philadelphia-area video dealer who had been one of the site's biggest sellers, auctioning nearly 10,000 close-out movies a week. After he lost a key supplier, sales took a hit. Now he lists 1,000 titles a week on eBay and remains profitable by also selling at rivals such as Amazon.com.

"I went full circle," said Lazar, who pared his staff from 21 to seven in recent years. "I started in my house, and then we got into a big warehouse. I had 19,000 square feet at one time. Now we have about 2,100 square feet."

All of which suggests a get-rich-slow dream on eBay. It may be more about taking control of lifestyles than raking in moolah.