Profiting From eBay Arbitrage

I think the best way to explain eBay arbitrage is to give you a few examples. Each example illustrates a different method of eBay arbitrage.

Every few days, I go through my bookmarked searches and see what is new. A few months ago, I found an auction with a pile of Lionel Trains from the 1920s and 30s containing a pair of cars I wanted for my collection. Also included in the auction were a few other cars and a locomotive. The pictures were terrible.

I save bad eBay images to my drive and then enhance them to see what the seller has. It takes a few minutes to clean up an image, but it is worth the effort. After I had cleaned up the images the stuff looked really clean. So I figured up what it was worth and set up a snipe. I bid $425. for the group of trains and bought them for $87.91.

This big difference between what I bid, and what I ended up paying was due to the poor pictures and because the auction was listed in the wrong category.

After I got the items in the mail, I pulled the two cars I wanted out for my collection and listed the rest on eBay. I ended up selling everything except the two cars I wanted for $480.00.

I put a pair of cars worth about $350 into my collection and made $375. Not bad for a half hour of work.

There is also a variation of this. I started buying trains out of England on eBay and then sell them locally. This is the true definition of arbitrage. Taking advantage of geographic price differences.

When I am looking for items in England, I look for really clean boxed items in groups. I need to get 5 or more items at a time because the shipping cost eats into my profits. I buy common items in England for up to 10 pounds each (An English pound is about $1.60 so that's about 16 dollars each.) Here in the US I can get 30-50 dollars a car at the local shows.

eBay Arbitrage is Profitable

It's a no brainer. For every dollar I spend, I get at least two dollars back. Sometimes I get much more.

There are also foreign language sites like the German ebay.de. I can't speak German, but do know the manufacturer's names and model numbers for the items I want. When I find something interesting on the German site I check to see if the seller will ship to US - the site is laid out the same way as the English site we are familiar with look for the word "Weltweit" which means worldwide.

Once I make sure the seller will ship to me, I translate the page by copying and pasting it into the text translation tool at Dictionary.com

http://dictionary.reference.com/translate/text.html

Many Germans speak English, and those who do not will be able to pull your address out of the translated messages, so you won't have a problem communicating. Use the Dictionary.com site to convert your emails from English to German.

Look for sellers that take PayPal because it is the easiest way to pay. If the seller doesn't take PayPal, you can safely wire transfer money directly to the seller's bank account for a 20-30 dollar fee from the United States. Make sure you specify the amount the seller receives in Euros, not converted dollars as the amount to send.

Make sure you factor in the wire transfer fees and currency conversions along with the shipping cost to determine your bid amount.

There are three more forms of eBay arbitrage I need to mention. I have been buying and selling trains for almost 30 years, and have a good reputation and following. I know lots of collectors who do not buy trains on eBay. Either they are too busy, or they do not want to risk getting ripped off.

Because they will not buy items on eBay, I can make money off them. When I see something that will interest them I bid on it and when I buy something I offer it to these local collectors. Probably the best example is a few years ago, I bought a train set on eBay for $581 including postage. When the trains came in I made one call and sold them for 1600 dollars. I made over a thousand dollars for an hour of work. Even better, the seller took credit cards so I paid with my Visa card, and sold the stuff for cash before the credit card bill came in.

This might seem like free money, but it is really a result of knowing what the stuff is and where to sell it. Arbitrage requires knowledge.

Another form of eBay arbitrage has to do with location again. I also buy large steel pedal cars and wagons. I look for desirable ones in areas where I can pick them up.

Last year I bought one out of Southern California for $85.00. I had a friend pick it up from the seller, and another friend bring it back to Arizona. I cleaned it up and got $750 for it. A profit of $665!

The final and last form of eBay arbitrage is searching local auctions. This is not as profitable as the other forms, but every now and then it pays off.

I look for local auctions where people are selling all their trains in one lot. If they have an insane reserve that is even better. I contact the sellers through eBay and then call them to try to go over and see the stuff personally. It is almost impossible to buy trains from these greedy sellers, but I am more interested in getting into their homes.

You see these sellers have "researched" their trains, but not the toy car sitting on a shelf in the garage, or the guns in the closet, and the bicycles in the back yard.

Have you figured out what I am doing here? I am going into these people's homes with a pocket full of cash and buying other items. The a great recent example of this is a small toy car I paid $35 for then sold on eBay for $335.00. I also do pretty well with dishes and vases.

I'll wrap this up now with a few last pieces of advice. In order to do this successfully you MUST use two different eBay accounts. I have my main selling account with the high feedback that everybody knows about. I also have other eBay accounts I buy with. I use these buying accounts until I get 30 - 40 feedbacks or until people figure out it is me, then move on to another account.

Never buy something for resale using your selling account. Keep your buying account private, and do not become attached to it.

In order to successfully benefit from eBay Arbitrage you also need a good knowledge of the collectibles you concentrate on, and a list of local buyers is quite helpful.

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Terry Gibbs has taught over 7,000 people how to make a good living on eBay. Terry's most recent eBay instruction manual is The Auction Revolution . The Auction Revolution is your guide to eBay and beyond. Here on Iwantcollectibles.com, you will learn about buying and selling antiques and collectibles, and about eBay.

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