A Practical Guide on Finding a Profitable Product to Sell on eBay

find profitable productsYou are in the business for profit unless you sell items for charity or donations. It is, therefore, very important to know how to find a profitable product.

Finding a profitable product is to know how to research, calculate and workout margins. It is not enough to see products on the so called wholesale websites with bogus MSRPs or RRPs which promise high margins. To know whether a product will earn some money is a process which involves gathering data, manipulating data into meaningful information and working out to reach meaningful conclusions.

Finding the Right Product is the Hardest Part of the Game

Trust me, it is true. It is true without any exaggeration. Find the right product, and boom, you are done!

I highly recommend that you check out Terapeak. It will make your life a lot easier during your research.

What about all other strategies, learning curves, tips and blah blah? Yes, there is a learning curve in all these, but these are easy to learn. And once you master them, there is little to add on top of them every now and then.

But…when it comes to finding the right product, it is an uphill task, especially for beginners.

eBay is wonderful playfield. However, it is tough by the rule of competition. It is highly competitive. Unless you find something that you can sell relatively better than competition, it is very hard to establish yourself as a successful entrepreneur.

The price variable can either make you a loser or winner in the game. It is that simple!

I don’t mean to scare you off. I just want to tell you something that you need to be ready for and that you need to think it be the most important of all your eBay’s business priorities.

Nobody Will Tell You What to Sell?

O, Yes! You cannot go to an experienced and seasoned eBay seller and ask them if they can show you some profitable products. Trust me, no one would do that no matter how close you are to the person.

Also, there are no miracle products. There is not any such thing that you can easily source constantly and sell them at higher margins. No, there is no such thing.

You need research, research and research.

Why Do You Need Research?

You need a lot of research if you are completely new to eBay without any prior experience in sourcing stock to trade. If you have already been retailing or wholesaling in the offline world, this is comparatively easy to manage.

But if you are a newbie, then you need a lot of research before you commit to buy anything.

I said a lot of research. Yes, that is right. You need a lot of research because there are millions of products and hundreds and thousands of wholesalers. You will find the right product only if you carry an intensive research to sieve through and filter the fluff or as the saying goes to find a needle in the haystack.

Finding a profitable product is like looking for an honest man in the Congress. lol

All I want to say is get into a research mindset. Research, research and research!

Avoid the Most Popular

Hum, what? Avoid the most popular? Why? They are more popular, so they sell more! You may be asking question like these. Yes, the more popular sell a lot. That does not mean they are profitable.

What will you do of a sale that does not bring you profit? Making one sale with 20% margin is better than making a thousand sale with no margin.

Most popular products these days are like IPhone, electronics, laptops, iPad and all other related categories.

There is a huge inventory of these products on eBay and they sell in good number each and every part of a second.

For a small starter seller, there is no way to compete in these products unless you come across a windfall inventory!

When I started first, for a year I struggled as I stepped into mobile phone accessories niche. It was easy to find the products all around. It was easy to source them. But I struggled to make any real money out of these because there was a lot of competition. Everyone else was selling that.

And to make any real success, you must do something different.

 Storm Your Brain

This is what people call it brainstorming. I prefer to call it storm your brain because brainstorming feels to refer to abstract ideas. “Storm your brain” on the hand, feels more practical, real, solid and even enjoyable.

Storm your brain is a simple process of gathering ideas and noting down them either on a piece of paper or on computer notepad program of your choice. It is very important to write them down. You will need them later on to process them and filter through and reach your needles in the pile of hays.

Storming your brain is quite easy. You can start from anywhere. The easiest thing is to look around where you are sitting and you will immediately come up with so many ideas. For instance, if you are in the bathroom, look around and you will come up with so many product ideas. Here are a few examples:

  • Toilet Seat (is that that first you noticed, wink)
  • Shower curtain
  • Tooth brush
  • Tooth brush holders
  • Trash bin
  • Bath mat
  • Hooks
  • Bath towels
  • Soaps
  • Shampoos
  • Lighting
  • Bleach
  • Mirrors
  • Hand towels
  • Wipes
  • Taps
  • Plumbing stuff

These are 16 ideas came up by storming your brain just looking around in the bathroom. Remember, these are not limited to 16. If you have a second look, you will find many more.

Last time, I was sitting in my car waiting for my wife outside the local doctors clinic. I knew these guys take a lot of time and never call your name in time. I took out my IPad and looked around in the car in and out and noted the following list of products just within a few minutes.

  1. Air Refresher
  2. Belts
  3. Car cover
  4. Car mats
  5. Phone older
  6. CDs h holder
  7. Seat covers
  8. Air compressors
  9. Internal mirrors
  10. Side mirrors
  11. Gear Knob
  12. Key chains
  13. Tool box
  14. Wipers
  15. Steering lock
  16. Tax disc holder
  17. Horns

You see, how easy it is! Next time you are in the lounge, shop, office, kitchen, garden, riding a bike, wherever you are, just look around and make a list. Once you get used to it, you will be able to storm your brain in no time.

There are other methods which you can combine with the ones shown above. The other methods should not be used on their own. I prefer the practical method above as it gives you a feeling of real things. Also, you are not talking about things which are simply ideas. If you list the stuff in your own bathroom or the accessories from you own car, that means you actually bought them and so should be other people.

So, you are dealing with real products. And remember, I said to storm your brain and not simply brainstorm.

Search What Other People Are Selling on eBay

I do not mean you go and copy them. May be they have spent a good time and know where to source from. Their experience enables them to find the right product at the right price. Looking at them and noting down a couple of product ideas will open up your mind to new possibilities.

In order to reach some good conclusion, I recommend to, at least, search for 9 sellers in a particular segment.

  • 3 Top and Best Sellers
  • 3 Average Sellers
  • 3 Worst Performers

In most case people go and check what the top sellers in a given niche are selling and they jump into conclusion. This is strategy is flawed. Those top sellers may have strengths which you may not achieve as beginner or as a casual seller.

The top 3 sellers in the niche will give you a good grasps of the market demand and the size of the market. You will also be able to estimate the potential in the market. Also, do not forget that we simply want a list of some products for the purpose of gathering ideas.

The 3 average sellers will reveal the low spectrum and how the product perform if you end up in becoming an average seller without equaling the top performers.

The 3 worst sellers should give the other side of the coin. What will happen in the worst case scenario.

Just search for all the products you made a list of in step No 3 i.e. brainstorming. Now is the time to find the sources for buying these items.

Once you have located the wholesale source and found the product that you are interested in, make a note of the products and it is the time to test the product price.

How to Determine the Buying Price

calcluating price

This is the most important and the trickiest part of the whole process. Make sure you follow the instructions here and do your homework the correct way. Finding the right product at the right price is the one thing that will either make or break your business.

Remember, do not be tricked by the so called wholesale prices quoted at the online wholesale websites or directories. Many times you will find wholesale vendors quoting fake or inflated MSRPs and RRPs of the products and the sale price. They will also quote how much can you sell it for and pocket the big so called margin.


Items MSRP $100
Offer Price $ 55

Profit Margin $45

Never ever trust these so called profit margins unless you do your homework to reach at the correct prices. The next step will guide you how to do that.

Compare Your Price Against eBay Sold Listings

cow leather soldThis is one of the greatest features of the eBay platform. Just enter your search product in the eBay search items and check the completed list items. It will show a list of all the items that have already been ended. It will show you both sold and unsold item.

If you check the sold listings box, it will show only those listings which have successfully ended. This will give you a general idea of the product you are planning to buy.

Your next task is to find the average sale price. The reasons you need to find the average sale price is that you will find some times sold at a higher price while some at lower prices. There can be a variety of reasons such as condition, listings, descriptions, titles, postage etc.

Once you are on the sold listings page, just count the items by adding it either using your calculator or jotting down the price to a spreadsheet. Add up the sale price of all the items and divide it by the number of items.

If the numbers of items are too many then you don’t have to count all of them. Just any number like between 100 to 200 is fine.

Check the Demand for the Product by Calculating the Conversion Rate

Once you check the completed items, make sure that there is enough demand for the products. Higher demand means more sale potential and more profits.

Conversion rate is the rate at which a product is sold. The higher the conversion rate, higher are the sale and success rate. The conversion rate can be calculated by dividing the number of sale by the number of listings. For example if a particular product has a total 100 number of completed listings and 20 of the are sold, the conversion rate is 20/100 which is 20%.

If you are doing all this manually, you may find it difficult and very time consuming to calculate conversion rate for different products. Some products have more than a thousand completed listings. It will take a lot of time to count all the items and sold number of listings. To make things easier, you simply take a certain number to reach at an average conversion. Ideally 200 completed listings should be ok to arrive at good conclusions.

What is the ideal conversion rate?

Conversion rates can be as high as 90 to 100% and even below 5%. The ideal conversion rate depends upon the inventory, profit margin, listing format etc.

For instance, if you listing it in the auction format, ideal conversion rate should be above 25%. The reason is that all unsold listings cost you the listing fees which narrows down the margin. Unsold listings when relisted are credited with the listing fee if they sell. If you relist them with an average conversion of 25% again, you still have to pay listing fees for 50% of your unsold inventory.

As far as the buy now format is concerned, it depends upon the listing duration. Recent changes in the eBay’s fee structure do not charge listings fees up to a certain number of listings depending upon the level of your eBay shop subscription. In this case conversion rate above 10% is above the risk. Please note that you still have to pay final value fees once the items are sold.

Real Example of Calculating the Average Price

For the sake of this example, let say that you found a cow leather shoulder bag with a supplier who quoted a wholesale price. In order to find out whether the price quoted will bring you any profit, we need to find out the average price.

1. Go to eBay.com or the country specific website you are interested to sell in.

2. In the search category enter the phrase cow leather shoulder bag.

cow leather search
3. On the left hand side, narrow down by clicking the relevant sub-categories.

results found
4. From brand options check not specified.

not specified
5. Check completed listings and make a note of the number of items.

completed items
6. Now uncheck completed listings and check sold listings.

sold listings
7. Note down the number of listings.
8. Divide the number of completed listings by the number of sold listings. in this case so the conversion rate is
10. Add up the sale price of all the listings or 100 to 200 in a spread sheet or just using calculator. You may round the decimal point to make things easier.
11. Divide the total amount by the total number of sold listings that you added up and you get your average price which is 3885/111=35

Cannot do all this manually?

I know it is very time consuming, boring and even sometimes disheartening. Some excellent tools can save you a lot of precious time and so increase your return on time. Check out Terapeak to make your research easier and fun!


I am KK an eBay and Amazon expert, teacher and internet marketer. I offer advice on e-commerce, content marketing and guest posting.

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