An online reseller is an individual or business that acquires goods to sell for a profit through digital platforms. This business model offers a flexible entry point into entrepreneurship, serving as a side hustle for extra income or a path to a full-time career. The core activity involves sourcing items at a low cost and listing them at a higher price, with the difference representing the reseller’s profit margin.
Find Products to Sell
Finding the right products is the engine of a reselling business. A common starting point is local thrift stores, garage sales, and estate sales, where unique items can be found for low prices. Look for undervalued goods, such as brand-name clothing with minimal wear, vintage home decor, or classic books. Developing a routine of visiting these locations regularly can lead to a consistent supply of inventory.
Retail arbitrage involves buying clearance items from retail stores like Walmart or Target and selling them online. This requires using smartphone apps to scan barcodes and see the item’s current online selling price and sales history. Profitable finds include toys, seasonal items after a holiday, and discontinued electronic accessories. This method involves sifting through clearance aisles to find products with a significant price difference to make a profit after fees and shipping.
To source in larger quantities, purchasing liquidation pallets from wholesale suppliers is an effective approach. These pallets are filled with customer returns, shelf-pulls, or overstock inventory from major retailers and can be bought from companies like B-Stock or Liquidation.com. While the per-item cost can be low, this method carries higher risk as the condition of items can vary. It is recommended for resellers with experience who can handle a larger volume of diverse products.
Choosing a niche, such as vintage t-shirts or first-edition books, can help a reseller become an expert and build a dedicated customer base. A generalist approach, selling a wide variety of items, can also be successful. Many new resellers start as generalists to learn the market and gradually narrow their focus as they identify what sells best for them.
Choose Your Online Marketplace
Selecting the right platform depends on your inventory, as each marketplace caters to a different audience and has a unique fee structure. Researching these platforms before listing is a key step in aligning your products with the right buyers.
eBay
eBay offers access to a massive global audience and is well-suited for unique, collectible, and vintage items. Its auction-style listing format can help drive up the price for rare goods, though sellers can also use “Buy It Now” fixed-price listings. Fees on eBay consist of an insertion fee for the listing and a final value fee, a percentage of the total sale amount, including shipping. This platform is a strong choice for diverse or hard-to-find inventory.
Poshmark
Poshmark is a social marketplace focused on new and used clothing, shoes, and accessories. The platform has a community aspect where users can “share” listings to their followers, increasing visibility. The fee structure is straightforward: for sales under $15, the fee is $2.95, and for sales of $15 or more, Poshmark takes a 20% commission. Poshmark provides a prepaid shipping label for all orders, simplifying fulfillment for sellers.
Mercari
Mercari allows for the sale of a wide variety of goods, from electronics and toys to household items and clothing. This makes it an accessible starting point for beginners selling items from around their home. Mercari’s fee structure includes a payment processing fee and a 10% selling fee. The platform’s simplicity and broad categories make it a versatile option for generalist resellers.
Facebook Marketplace
Facebook Marketplace uses the platform’s social network, making it a powerhouse for local sales. It is effective for large, heavy, or fragile items that are difficult to ship, as sellers can arrange for local pickup and cash transactions, avoiding fees. For sellers willing to ship, Facebook also offers nationwide selling with a 5% selling fee. This platform is a great option for moving bulky items and reaching a local customer base.
Set Up Your Business Operations
Separating personal and business finances is a foundational step. Open a dedicated business checking account to deposit sales revenue and pay for business expenses from one place, which simplifies financial tracking. Accurate record-keeping is also necessary for managing your business and preparing for tax obligations.
A simple spreadsheet can track every transaction, including the sale price, cost of goods, platform fees, and shipping costs. This data provides valuable insights into your most profitable products and sales channels, helping you make smarter inventory decisions.
As your business grows, you may need to consider its legal structure. Many resellers start as a sole proprietorship, which is the simplest structure and links your business and personal liabilities. Forming a Limited Liability Company (LLC) can provide a layer of protection by separating your personal assets from your business debts. Consulting with a legal or tax professional can help you choose the right structure for your situation.
Create Compelling Product Listings
High-quality photographs are the most impactful element of a product listing. Since buyers cannot physically inspect the item, your photos must serve as their eyes. Use a smartphone or camera to take clear, well-lit pictures from multiple angles against a plain, neutral background. Capture any important details, including brand tags, unique features, and any flaws or defects, as honesty in photos builds trust.
The title of your listing draws buyers from search results, so think like a customer and use keywords they would use. Include the brand name, item type, color, size, and style. For example, instead of “Blue Shirt,” a more effective title would be “J. Crew Men’s Slim Fit Button-Down Shirt Medium Blue Gingham.” A descriptive title improves your visibility and attracts relevant buyers.
Your description should provide all the details a buyer needs. Reiterate the information from the title and add measurements, materials, and condition specifics. Be transparent and thoroughly document any signs of wear, stains, or damage. Pricing your items competitively requires research; search for similar items on your platform and filter by sold listings. This “comps” research helps you find a price point that is both fair and profitable.
Manage Shipping and Customer Service
Assembling the right shipping supplies ahead of time prevents delays. Your toolkit should include boxes of various sizes, padded mailers, packing tape, and a shipping scale to weigh packages accurately. Many of these supplies can be ordered for free from carriers like USPS or purchased in bulk from online suppliers to reduce costs.
Most online marketplaces have integrated shipping solutions that simplify the process. You can purchase and print a shipping label directly from the platform, which often provides a discount on postage rates. Using a thermal label printer can further streamline this process by eliminating the need for ink and paper as your sales volume increases.
Prompt shipping and clear communication lead to positive customer feedback. Pack your items securely to prevent damage during transit and aim to ship them within your stated handling time, usually one to two business days. If a buyer asks a question, respond politely and professionally. Handling issues like shipping delays or returns with a helpful attitude can turn a negative experience into a positive one.
Scale Your Reselling Business
To manage a growing operation, an inventory management system is needed for tracking what you have, where it’s stored, and how much you paid for it. This can start as a detailed spreadsheet but may eventually evolve into specialized software. Knowing your inventory prevents overselling items and helps you identify slow-moving stock that may need to be discounted.
Reinvesting your profits is a primary driver of growth. As you generate income, allocate a portion of it back into sourcing more inventory. Increasing your purchasing power allows you to acquire higher-quality items or buy in larger quantities, potentially at a lower cost per item. This cycle of selling and reinvesting builds momentum for your business.
Upgrading your tools and workspace can also fuel expansion. Investing in better lighting for photography, a mannequin for clothing, or a thermal label printer can improve the quality of your listings and the efficiency of your shipping process. As your business grows, dedicating a specific area for inventory storage and a packing station will keep you organized and streamline your daily workflow.