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How to Start an Online Auction Site

Online businesses have exploded in the past few years, and why not? You immediately eliminate many of the setbacks inherent in business startup, such as weather, location, reaching people during off-hours, lack of space, and the difficulty of securing and maintaining a property. Best of all, it's a win-win situation---you create your own hours and work from the comfort of your home, and customers snag a bargain without spending hours perusing garage sales and discount bins.

Create a payment system. Make each type of product available as both a bid item and a flat-rate item so that customers have the option of purchasing a product right away. Determine what methods of payment you accept.

Fill a gap in the market. You can't expect customers to buy a product that a more established seller already provides. Browse sites such as Ebay.com and Amazon.com to determine what others are selling. Work off of an already existing category to meet the public's needs. For instance, thousands of sellers list health-food products but not too many list vegan energy bars. Though vegans may not compose a huge demographic, for those living in areas where there is no access to these products, you could be their only provider.

Determine shipping rates. Give customers multiple options---standard, expedited, 1-day, international. Keep in mind how much each item costs you to ship, so that you make a substantial profit. Ship each item as cheaply as possible to keep rates low for customers. For instance, lightweight items such as paperback books can easily fit in a basic manila envelope with protective wrap. Use USPS flat-rate envelopes and boxes for heavy items, because there is no weight limit. Nobody likes to get excited by a good deal, only to find out that shipping costs nearly as much as the product.

Sell your passion---products that you are knowledgeable and enthusiastic about. Sell only these products at first, and increase your inventory only after you have achieved financial success. This way, interested buyers can immediately find your product using an online search engine such as Google. If you start off unfocused, you will be lost in the glut of online sellers.

Advertise your site. Post ads on websites that appeal to people interested in your product. Create groups on social networking sites that promote your website, because those interested will spread the word to friends. Encourage friends to visit your website often, as numerous hits will increase your visibility in search engines.

Entice customers. Provide clear pictures and thorough product descriptions. Basic information such as quantity and price should be immediately visible; otherwise, customers will get impatient. Avoid adjectives like "excellent," instead choosing specific, vivid adjectives like "caramelized" or "almond-scented."

Difficulty: Moderately Challenging

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