Tim Chapman, Mr.CustomerService, shares his advice for renewing our customer service best practices. eBay seller Alec Larson of Larson Enterprises shares how he started his business on eBay selling auto parts and how he tracks and manages it today. Brian and Griff answer two seller questions about unwanted combined shipping discounts and the best strategies for multi-quantity listings; relist or restock?
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Episode 127 Links
Sellers in the Northeast
eBay 4th Quarter Results
Tim Chapman’s eBay Store
Alec Larson’s eBay Store
Shipping Preferences
Quantity Display Preference
Stock Out Preferences
Hosts:
Griff, Brian Burke
Guests:
Richard Cooley (eBay seller)
Transcript:
Sellers in the Northeast
eBay 4th Quarter Results
Tim Chapman’s eBay Store
Alec Larson’s eBay Store
Shipping Preferences
Quantity Display Preference
Stock Out Preferences
Recurring Links:
Hosts:
Griff, Brian Burke
Guests:
Richard Cooley (eBay seller)
Brian: This week on the eBay For Business Podcast:
Tim Chapman: "Essentially, it's not about you. It's about the customer. If you serve the customer and give them what they want, which is a good product at a fair price, you will be rewarded.”
Alec Larson: "What was challenging at first was when you're in the growth phase, when you're starting off that first year, you really don't have enough data to sort of compute what your real selling cost is. Am I going to move this inventory that I just bought in a year? I think it really took about two solid years to kind of get a rough idea of what my numbers were. The main expenses is inventory, obviously. The other main expense is the selling cost. So I like to really keep those two in focus. And I know I have a number based on I have to buy this much inventory every month or every quarter to sustain this monthly cashflow. So I know that if I wanted to stop this growth level right now, I have a number in mind that every month I need to spend this much on inventory.”
Brian: I'm Brian.
Griff: And I'm Griff and this is the eBay For Business Podcast. Your weekly source for the information and inspiration you need to start, run and grow a business on the world's most powerful marketplace. And this is episode 127. Hello Brian.
Brian: Hello, Griff. Good to be back after a week off for me.
Griff: If people haven't figured it out yet, we stagger weeks. So it's every other week. It's either you or Rebecca. And I love both of you.
Brian: Well, I hope so, but I think I'm going to up my game to make sure that our listeners really, really like me over Rebecca and she knows I'm kidding.
Griff: Why's aim so low? You should get them to like you more than they like me.
Brian: Oh, that would almost be impossible.
Griff: No, I think it actually would be really easy, Brian.
Brian: No, you've got years of experience doing this. I'm still like a neophyte.
Griff: Yeah, me too. Nice weather. We're having.
Brian: Well, you know you say that. And I was thinking about that cause I'm looking outside and it's all blue sky, but I know there are other parts of this country where our listeners are that it's brutal.
Griff: We're going to talk about that in a minute I think.
Brian: It impacts shipping sometimes.
Griff: It does. It impacts shipping. So we have some news for our sellers in the Northeast in a minute, you'll hear that. It's actually from last week, but I think it still bears repeating. And we also have some news about, well, eBay,
Brian: That's good. Yeah. So as you are kind of hinting at it. What's on the program for this week?
Griff: We have two sellers first. We'll talk to Tim Chapman and he's an old friend of ours from the eBay radio days. He's known as Mr.CustomerService. And we're going to talk about, well guess.
Brian: Customer service.
Griff: Correct. Specifically how to plan our customer services best practices in order to address worst case scenarios long before they happen. And then we're going to meet a seller from Florida who actually approached us and said, Hey, he'd be interested in being on the podcast. His name is Alec Larson and he runs an auto parts business in Florida. And we'll learn how he started his business. And specifically this week, how he manages and tracks his business inventory and sales. All this and more first up, let's find out what's in the eBay news this week Brian.
Brian: We have two news items this week. First eBay is extending seller protections to sellers impacted by extreme weather conditions in the Northeast.
Griff: Yeah, it was blizzard time last week in new England. Brought back memories,
Brian: Feet and feet of snow, not just new England, but the entire Northeast US. If you're located in the impacted areas in the Northeast and are not able to ship your inventory, we recommend you communicate with your buyers to advise them of the situation and extend your handling time on your listings if you expect delays.
Griff: Always a good practice.
Brian: It is. And if your business is impacted, eBay will automatically protect your seller performance, including your late shipment rate, your valid tracking upload rate, item not received cases due to late delivery. As long as you have uploaded, tracking and have a physical scan from the carrier before your case was opened.
Griff: Good. And there's more on the seller news board, so you can read the entire post there. What else is in the news? Brian?
Brian: Well, last week, eBay announced another strong business quarter for the last three months of 2020. With 18% GMV or that's gross merchandise value growth and unprecedented traffic levels. Growth exceeded all expectations in every area, including active buyers, new sellers, traffic, conversions, and sales. In fact, eBay recorded its biggest cyber five in the United States with one out of every 10 US shoppers flooding the site, seeking hard to find and sold out items. Refurbished gifts emerged as top trend with many products selling out completely. Jordan Sweetnam. eBay's Senior Vice President and General Manager of Marketplace America's added, Thank you for the incredible effort you put into your eBay businesses. The amazing variety you offered, unparalleled quality you supplied and exceptional service you delivered, made all the difference. Our sellers are great. Aren't they?
Griff: They are. And what a great way to start 2021. Let's keep that momentum going.
Brian: Absolutely.
Griff: So, lots talk about in the next year that we're now into .Stay tuned to the podcast. There's a lot of new features that'll be announced. I know that Harry Temkin is going to be on soon. Maybe even next week.
Brian: I always liked listening to Harry. I learn new stuff all the time and it's not just about products that have been rolled out, but it's insights into some things that have been out for like a year. There'll be some other nugget of information I pick up.
Griff: Yeah. And they're doing a backend change of the platform that's used for reporting. So it's a brand new platform and this will allow the team under Harry to build out an incredibly robust set of reports for eBay sellers to use for their business. The request has been out there for a long time. We love the reports. We wish we had more data. We wish they went back longer. We wish, we wish ,we really need and all of that's coming. So it's going to be exciting year. Even if you just look at stuff like in Seller Hub,
Brian: That's fantastic. Our sellers are always asking for more info about their business.
Griff: Yeah. And I'm dying to see the new listing flow. I know that I'm supposed to be in it soon. Brian, you asked for my user ID so I could be added to the pool, so to speak. And I'm dying to see that. I like to try these things out as soon as I can.
Brian: Hopefully it will be added. They're being very restrictive on who they're adding right now, but I'm sure you'll get in.
Griff: I don't like to pull rank, but I have been here for awhile. So.
Brian: Exactly. So anything else?
Griff: No, that's it. I think it's time to start the show.
Brian: So I'll be back in a little bit to help with You've Got Questions.
Griff: Great. Thanks Brian. In the meantime, we're going to meet with Tim Chapman.
Griff: February is Renew Month and one of the aspects of running a business that we should all renew every year is our commitment to providing the best possible customer service we can. Our guest today is somewhat familiar with the topic. In fact, he's known by as eBay user ID, Mr.CustomerService, Tim Chapman. Welcome to the podcast Tim.
Tim Chapman: Thank you for, thank you for having me, Griff.
Griff: I don't think We've spoken since eBay radio days.
Tim Chapman: I almost said Griff and Lee right there. Sorry. (laughter)
Griff: I'm sure she'd appreciate that. We'll have to get her to listen. I'll leave that in. Remind us how long you've been selling on eBay Tim.
Tim Chapman: I've been selling since June of 2001 coming up on 20 years. So pretty good.
Griff: Wow. Your user ID is Mr.CustomerService. Why that user ID?
Tim Chapman: First of all, well, as you know, on the early days, we got the good user IDs, but mostly it's so that people can remember me. I want my buyers to remember my name. Because I mean there's millions of sellers out there and they buy something. Well, they have to go look it up and say, Oh, I know that guy, Mr.CustomerService, it's easy to remember. And in a word it tells what I'm all about. I'm about customer service. That's me.
Griff: So I know you said the early days you could get those good user IDs. It's still possible, but you might have to get really creative. And I think that's our first tip. You lead us right into it. I wasn't thinking about this, but if you've got a user ID, that's a combination of letters and numbers. You might want to consider getting something a little bit more memorable.
Tim Chapman: Yeah. It's hard to type in. It's hard to remember and it's obscure type of thing. But the early days there were some good ones out there. I got this one and I have a number two at the end and a too at the end. So I have my other names as well.
Griff: And in case you need them, but you specialize selling on Mr.CustomerService.
Tim Chapman: That's correct. Yeah. Mr. Customer service. And you can just Google, you know this name. If you're out there, you can just Google the name. It'll jump right to the eBay store.
Griff: And I'll put a link to your eBay store in the transcript for those people who are interested and they should be because, well, you're kind of an expert on this. You specialize in it. It's a passion. What are the more common customer service mistakes you've seen on eBay ones that sellers make quite frequently?
Tim Chapman: Yeah. Griff on this one. I think you're going for specifics, but if it's okay, I'm going to go for a little bit of an umbrella point of view on this one. So essentially it's not about you. It's about the customer. If you serve the customer and give them what they want, which is a good product at a fair price, you will be rewarded. It reminds me of a famous quote by Zig Ziglar. I'm big on these quotes and stuff. And he was one of the best salesman of all time. And the quote goes like this. "You can have everything in life you want, if you will just help enough other people get what they want." And it goes with eBay, Sell a lot of stuff. You're going to make a lot of money, serve the customer. And that's what it is about.
Griff: We didn't want to get right into specifics, but there's been an incident or a situation for the last few months that's put a lot of sellers on edge and it is well, their carrier delays. You know, lots of sellers and by extension, their buyers have been impacted by these carrier delays that mostly USPS experienced during the last months of this year. And even through last month of January. Where you one of those sellers, by the way?
Tim Chapman: Yeah, absolutely. I had several items go lost .in the early days USPS, we could rely on them absolutely. If it's going to be there in two or three days, it's going to be there in two or three days. But what happens COVID came and they've become totally overwhelmed. And they're not doing this on purpose, they are doing the best they can but I've had several items go lost. And fortunate enough, a few of the buyers have, Hey, this thing finally came after two and a half weeks and they'll send me the refund. I sent them the reverse it and get it back to me. But on the Priority Mail packages. You can make a claim and if it arrives, it arrives, you know, type of thing. But yeah, we just do what we can. So I've definitely been, been hit with that one.
Griff: Did you file any claims by the way?
Tim Chapman: Yeah, I filed, I think three or four Priority Mail claims, cause it has automatic a hundred dollar insurance on the Priority Mail. But on the First Class I took a hit on a bunch of those, but it's part of business. It's not going to help to get mad. Don't take it personal. It's just part of business and timing right now. So for the most part, I'm saying 97, 98%, everything is going through fine still. I still use UPS all the time, except for my real big stuff.
Griff: What do you use for the big stuff?
Tim Chapman: Well, the good thing now UPS and FedEx are competing with each other with all the eBay sellers and they work together. And so between both of those on FedEx and ups, you can do it on eBay and they're competing with each other and the prices have gone down and for big stuff, even big stuff that goes through the post office, you might want to look at FedEx or UPS because it could be cheaper than priority mail. So thank you eBay for that one.
Griff: Well, we try. Now I know it's not about me, but when I think about customer service, I tend to divide customer service practices into two groups, reactive and proactive. So for example, there are reactive practices. A seller can use for situations like long carrier delays, like a buyer contacts you and says, Hey, my parcel is not here yet. Those are kind of reactive to a buyer's query or complaint. And these are important of course, but I've always stressed the importance of proactive practices. Do you think of it this way? And if so, what are the, some of the ways you think of proactive customer service practices?
Tim Chapman: Yeah, for me proactive, I think you might be leaning towards, you know, if you know an item's going to be late, contact the customer and perhaps I generally don't do that once it's out of my hands. Honestly, I don't have time. But if you know something's going to happen, yeah. Go ahead and contact the customer. But to me, the real proactive customer service is to take and have exceptional images and very clearly pointing out any fault in the item that the item may have in the images and the description and the condition. And I very often will even put it in the title I'll put with issue in the title. So the people know there's an issue and make sure to read it because a lot of people on their phones and stuff, they go, Oh, I didn't see that this was a problem and they're not lying. They just bought it on their phone and they didn't read everything. We know that the customers, they don't read very much. We know that. eBay knows that and they've told us that. So that's why I'll put in princesses with issue in the title and it makes them read it. It doesn't mean that they don't want it. We don't want to hide anything. That's bad customer service, you don't want to hide it and you don't want it to get there. And they say, Hey, what's this? Surprise. You don't want that to happen. You want it to be as smooth as possible. The whole experience often if there's room, I'll definitely put it in the title with issues when it has an issue.
Griff: I also like to think about worst case scenarios and how I'm going to handle them before they actually happen. That's what I mean for me about proactive. So what's the worst that can happen with this parcel. And am I ready to deal with that? And how am I going to deal with it? Not that I'm anticipating it would happen, but if something does happen, I've already thought through how I'm going to react. And hopefully I'll react calmly, professionally, like a good seller focusing on the customer.
Tim Chapman: Yeah. You know this one, especially with new sellers and you, and I know this, that new sellers, they have a tendency to take everything personal. Oh my goodness! Way too often people get upset about it. They lose sleep. It's not worth any of that. If it's really fragile, go ahead and put insurance on it. If it's Priority Mail, it's got a a hundred dollars insurance anyways, but pack it really well. And I don't worry about this stuff. You know, do whatever you can do the best you can on your end. That's all that you can do. You can't do any better than your best. I wouldn't worry about it. Just do your best.
Griff: Tim. You know, on the podcast, just like on the old eBay radio, we love tips. We especially love them when they're in order. So I'm going to ask you something. I think we asked you a few years back, Tim, what are your top three to five tips for sellers when it comes to reconsidering and renewing and recommitting to their customer service for 2021?
Tim Chapman: Really the big one, put yourself in the customer's shoes. What does the customer really want? The customer wants a good product at a fair price. And that's what eBay is about. Especially if it's used, which most of our stuff is, well, I'm an everything seller. So most of my stuff is used. So they want a good price. We'll give it to them. And you're going to have a happy customer. Pack your items really well. Make the experience good. When they open up the box, Don't put it in a pizza box.
Griff: I had a friend who got something on eBay and it came in a box. It was a Pampers box reused.
Tim Chapman: Oh my God.
Griff: Now it wasn't that it was unhygienic. But of course the message it sends is a little disconcerting.
Tim Chapman: If you have to use another box, turn it inside out, just cut the box open and turn it inside out. Then you have Brown on the outside and it doesn't look so bad. And I do that often, but I don't use Pampers boxes.
Griff: I love the idea of reuse, but there's just a point where you make yourself look bad.
Tim Chapman: Yeah. Ship on time. Do what you say you're going to do, it's not about you. It's about the customer. If you take care of the customer, everything else is going to work out. You will get a raise. If you want to have a raise. If you're not happy with what you're making now find a way to serve the customer better and sell more items and you'll have your rate.
Griff: Well, Tim, I really appreciate you taking time to tell us about all these things. Oh, absolutely. My pleasure. Tim Chapman sells on eBay under the user ID. Mr.CustomerService. Look for a link to his eBay store in the transcript for episode 127.
Griff: Our guests this week. He's a very interesting seller with a great story to tell, join me in welcoming eBay seller, Alec Larson. Hi Alec. Alec Larson: Hey Griff. Hey, everybody sort of nervous, but at the same time, excited to finally get to share some seemingly cool eBay story with you guys.
Griff: It's okay to be a little nervous. I think that keeps us on our toes, but I think you're going to be fine.
Alec Larson: I think so. And I am an introvert too. So I'll try to break out of my shell.
Griff: How did you get started selling on eBay, Alec? Yeah. So
Alec Larson: At the time this would be probably mid 2016. I was a musician at Disney. We were in a boy band and we would play four nights a week. It was great. The other good thing about that is I had the entire day to pursue entrepreneurial projects and that was a huge benefit to have that extra time. And I knew, you know, at some point the musician thing couldn't last forever. I was in my mid twenties. I'd always had the entrepreneurial bug. I was at the time living in a very, very cheap apartment. It was not nice at all, but very cheap. And my goal was to save capital. I wanted to save up for some sort of endeavor. I knew I had to do something. It was either going to be real estate or maybe some opportunity that would come up. So I was sort of savvy with WordPress and I was building websites for local businesses to save money. That was my vehicle to sort of amass some sort of capital. My other background is in aviation. I'm a private pilot as well as an AMP. So I have some mechanical background. And one of the flight schools that I got my license at, the Director of Maintenance, wanted a website for his parts business and his name was Jack and we met and we sort of hit it off. We became friends almost right away. And he was explaining to me that he needed a website for his eBay parts business. He was just explaining his model to me. And he essentially became sort of my mentor because he would share how his model works. He was selling airplane parts on eBay and he had over a thousand listings at the time. And there was sort of a light bulb moment when he said that he had not just a few parts that he was selling. He had an assortment of inventory. There was a lot of aircraft parts that he was selling. I built him a website and he kind of got me started in eBay. And I, I don't remember how I found the niche of auto parts or how I decided upon it.
Griff: I was going to ask you that. Why auto parts?
Alec Larson: Yeah. So I, I should have probably started off saying I do OEM automotive parts, primarily for GM, Nissan. Parts that you would buy from the dealerships or from the manufacturer. They come in the original OEM boxes at the time. I think I had like a tote full of old jet-ski parts from one of my mechanic friends. And in there, there was a, like a timing belt for a Honda and it had the OEM Honda part number on it. And I thought that could be what I try because I knew that with, with auto parts, the price point was kind of where I wanted it. Jack, my friend that got me started in this, he had a good point. Like it takes the same amount of effort to sell a $10 part is it would like a hundred dollar part. So I liked the price point with auto parts where you're right around like 50 to a hundred dollars on average. And what I really liked was that there is a part number and that part number is kind of like your center anchor. It's the most specific piece of data you can use. And I knew that I was going to be able to find data on Google very easily. I was going to be able to find fitment data. I was going to be able to find the competitive price points. And if you put that in eBay, having just the part number to go off of instead of like several UPC codes or different sizes, I really liked that product niche. So I had a good feeling about it. And Jack's method of finding airplane parts was using local auctions, auction websites where you can buy bulk loads of inventory. And I thought there has to be an automotive parts niche just like that. So I was kind of eager to get started. I found a local auction. The first batch of inventory I bought was a pallet of Ford parts. And it was really, it was really distressed inventory. They were in the new OEM boxes, unused and I spent around 1,500 with my initial investment in that pallet of parts. When I got the parts, I rented a little U-Haul a trailer, got all the parts home. I think there was about 170 parts initially. And it took me at least a week or two to get those fully listed on eBay. And it came out to be somewhere between 12 to 15,000 worth of parts. The objective was to recoup the initial investment as soon as I could. Because my theory and based on Jack's model was that I've got 12,000 of inventory listed on eBay. If I sell and get my initial investment back within a month or two months, I can take that, reinvest that again. Now I have maybe, you know, 9,000 of inventory but now I, I just bought another load. Now I've snowballed that. Now I have a larger inventory dollar amount and that would equate to obviously higher cashflow and you can theoretically continue to build that and it would compound. And that was my theory. And it worked. It worked really well. So at this cheap apartment I was living in, there was a little garage. I essentially used the garage as the storage space. That was my initial starting point. So there was the initial investment was like I said, 1,500 and I didn't have any overhead with the garage. It was a good foundation to kind of validate the business model. See if I could recoup my initial investment, learn all of the mistakes that I knew I was going to make with shipping, figure out the Post Office, learn eBay a little bit. That's what I did. And what's cool is I have pictures of all of this. When I first started, I took pictures of like the first load I bought almost like a journal or a diary. I made my money back, I think within two months and I had money saved. So I, I knew that I was selling, I was moving inventory. My eBay selling limits were low to start off with.
Griff: Yeah, eBay kind of guide rails people into selling. So those limits can be pretty low when you first start off.
Alec Larson: Right. And it made sense too, because if I had been turned loose on the size, I am now it could be a disaster for customers. So that was good. And I think what I did was I called eBay and I would, every month I would ask for a limit raise and I forget the actual amounts, but it worked out completely fine.
Griff: What other challenges were there when you started first off?
Alec Larson: The main challenge was space. That was the main thing, which wasn't necessarily a challenge, but I knew if I was going to grow, I would have to find either a warehouse or a storage unit, but that didn't make sense at the time, cost-wise. So I wanted to try to bootstrap a little bit. The other challenge was I saw other eBay sellers, they had compatibility charts on their listings and I thought, okay, I've got to figure out how to do that. That was another challenge. And then finding a way to have a more consistent way of getting supply of the parts. I knew that I couldn't rely on just one-off auctions. I was going to have to find a way to make that more consistent, especially if I was going to have overhead like a warehouse.
Griff: What was the solution for that?
Alec Larson: Well, I knew that the initial load that I bought, I knew that those parts had come from a car dealership at some point, either a car dealership or a body shop. I know nothing about car dealerships or how the parts departments work, but there must be something that caused these parts to end up discarded. So I figured, okay, I've got to start maybe calling parts managers at dealerships, I've got to try body shops. And I think there's 20,000 total dealerships in America. So I said, if I can just tap into that, it should be a good way to validate the whole model .
Griff: And it worked. Alec Larson: And it did. Yeah. I had to break out of my introverted shell to call that's essentially how it got started in a garage and auction websites sort of. The cool thing about this was somebody can spend very little money on a large dollar amount of inventory, recoup their initial investment back fairly quickly and continue to snowball without having a large investment or going into debt or anything like that.
Griff: So give us an idea of how big your business is now. How many listings do you have up at the moment?
Alec Larson: Any given time? There's 4,400 to 5,000 listings at my warehouse and it's 3,500 square feet. So I've got three rooms, I've got a shipping room, I've got a listing room. And at any given time I've got two helpers. They're primarily doing listings, taking photos of parts.
Griff: Do you have an area set up in your business where you just take photos and someone does the listings?
Alec Larson: Yes, yes. And that's just a really big table with a roll of white sheet over it. And I've got your basic photo lights and what's really cool about the eBay app on the phone is I just have my employees log into the eBay app and they can take draft photos with the phone. So they're just taking photos with the phone. So it makes it very quick to upload the parts in draft mode. And then I can come on the computer and list them later.
Griff: You have a staff of two?
Alec Larson: Yeah. Two. And when COVID started, we obviously lost our Disney gig, but two of the other musicians in the band came to help me. So I had some trustworthy help. One of the guys still works with me today and I've got a girl that helps me do the computer listings and things like that. It could be run as a single person operation at this level. It just would be a little bit overwhelming to get things listed. Having someone listing the parts for you really accelerates and takes a lot of the grunt work off the table.
Griff: How has the pandemic affected your business? Have you been impacted by, for example, the shipping delays that many sellers have experienced over the last few months?
Alec Larson: I had tried at the beginning to predict what would happen. There was, it could have gone in so many different directions. My original worry was how are my dealership's going to be handling all of this? How is the shipping? Is the Post Office going to close down? Is the UPS going to close down? I was so scared. And none of that happened. What I would do is I would call the dealerships and check up on them. How are you guys doing? And the peculiar thing was, they were less busy in the service departments, but they were selling vehicles. They were breaking records for vehicles being sold. I wouldn't have expected that the other wild card was that in that month of April and May, there was a shortage of inventory of vehicles. So you had people buying used cars, holding onto used cars. The value of used cars was ticking upwards. So you had smaller dealerships, flipping used cars, reselling used cars. And that helped me because I'm selling trim panels, trinkets, emblems, and things that they needed. So at the same time, when you have this sort of bad sign, that people aren't going to be driving, but then on the other side, it made up for it and sort of equalized the demand for parts.
Griff: So that should have been a relief. I would imagine?
Alec Larson: Yeah, It was in the middle of March and I just day by day, I kept watching the sales come in and I'm thinking, okay, we're still doing this. We were still listing inventory. I didn't notice a drop off in sales because I was adding listings.
Griff: What about shipping delays over the last few months. How was that?
Alec Larson: Over the last few months you saw the Post Office struggling a bit, but then at the same time you had UPS enter the realm, I guess you could say. And the main problem was the tracking sometimes wouldn't pop up, I'm doing about close to 1800, 2000 units every quarter. And I might've had to open four lost claims.
Griff: I think all things considered. That's probably not a bad figure. Yeah.
Alec Larson: If it's a $9 gasket and it's lost, I would just apologize to the customer and say, I'm going to refund you for now. If it shows up, just let me know. But I didn't notice too bad of a delay. Just going off of the messages that I got.
Griff: How many customers who then got their packages after you refunded them?
Alec Larson: Yeah. I had, I had one where I sent out two pairs of tow hooks to somebody. They had told me they got the other ones and they were like, do you want me to send it back? Or I could send it back. And I, it was, I think I was going to lose like $40. So I just said, just don't go to the Post Office. It's it's not worth your time. I appreciate you calling. Yeah. Just one like that.
Griff: What are your plans for the business for 2021, based on what you've experienced over the last year?
Alec Larson: Since I started I've I've always been in a growth mindset. I've always been in a growth phase. I haven't yet decided where I want to stop. You know, I started in that little garage, then I moved into a four bedroom house that I was renting and I turned the living room into a warehouse. So imagine I have pictures of all this too. So I had a living room full of shelving of auto parts, dusty auto parts.
Griff: Where you living alone in that place at the time?
Alec Larson: I had one roommate and he was actually helping me with the business. So, and yeah, so we didn't have a TV. We didn't have a couch, we'd have guests over and they would be..
Griff: They would be shipping packages for you?
Alec Larson: Yeah. They'd say you have a stock room inside your house? I would have freight shipments come to the house, but it worked. It was, I was able to further validate the model, further acquire inventory, and then finally justify going to a big storage unit. At some point I knew I had to get to a bigger, more official warehouse and figure out how to get to the size of being able to handle that overhead.
Griff: What methods do you employ for keeping track of your business? Do you use accounting software? Do you have an inventory tracking system so, you know when you may have some parts that need to be restocked? How do you manage all this?
Alec Larson: I'm really basic. I use Excel or the accountant and for keeping my ship in the right direction.
Griff: I do as well, I use that. A lot of other sellers will rely on different software. You said you had staff. How do you handle, for example, payroll?
Alec Larson: Yeah, so they're not on a W2. It started off as always someone coming to help. They're not even part time. They would have a full-time job and they would come in and do some listings.
Griff: Like on a contractual basis.
Alec Larson: Exactly. So it would 10 99. That's primarily the labor costs. It's pretty low. Each helper is putting in a couple hours, maybe sometimes 20 hours a week, just catching up on getting the drafts made.
Griff: But as part of your growth plan, if you want to get to a point in your business where it's self-sustaining and you even have a clone for you, you're going to have to look at don't you think having full-time or part-time employees that are actually official employees?
Alec Larson: Absolutely. Yeah. And then coming up with a seller that would incentivize them to stay just because you're investing that time, training them. I really like to find someone that knows eBay as well, or is familiar with it, but yeah, that would be essential that has to happen.
Griff: Are you utilizing the eBay feature for Multiple User Account Access?
Alec Larson: Yes, I was initially when I would have people working remotely from home on there, but for using the eBay app, there's no way to do that. I would love to have some sort of the admin feature working on the app. That would be great.
Griff: You use Excel. How often do you make entries? Do you have a regular practice where you'd have to sit down and like I do every week, I don't sell that much right at the moment, but I'm always adding in my purchases. For example, when I know they're going to be inventory, how do you use your accounting software to plan out for something like buying inventory?
Alec Larson: Yeah, so I try to do it absolutely on a quarterly basis. And what was challenging at first is when you're in the growth phase, when you're starting off that first year, you really don't have enough data to sort of compute what your real selling cost is. Am I going to move this inventory that I just bought in a year? So I think it really took about two solid years to kind of get a rough idea of what my numbers were. The main expenses inventory, obviously the other main expenses, the selling cost. So I like to really keep those two in focus. And I know I have a number based on I have to buy this much inventory every month or every quarter to sustain this monthly cashflow. So I know that if I wanted to stop this growth level right now, I have a number in mind that every month I need to spend this much on inventory. But yeah, to your question, I try to watch that Excel spreadsheet and add to it quarterly and touch base on it. I'm watching my shipping costs because with my inventory, it's so random, I can be selling a bumper that has to go freight. And then I could be selling a, an emblem that goes first-class. The shipping is just all over the place as far as costs. So you're always watching those. The other big thing I learned was that the larger the business grew you initially wouldn't worry about saving 1% or 2% on certain things like shipping, but now with the numbers being the way they are paying attention to small things like that is really worth it. Saving 2% a month on shipping or watching your return rate. So some of those things, I try to tie into the accounting as well. I think those are critical, but yeah, so I use Excel to keep track of all the receipts and inventory I buy the loads that I buy. Yeah.
Griff: I think everyone who's using Excel actually creates their own custom form of accounting. Give us an example of how you're using Excel. For example, what do you enter for an item? Are there specific attributes that you have different columns? Be curious to hear this? I think as any seller, we'd love to know what another seller's doing.
Alec Larson: I would assume. And I would hope that there are probably much better methods than when I'm doing. It would be really easy if I had 50SKUs of the same part, you know what you paid for each one, this is your supplier. This is the margin I'm always going to make. And you can plan ahead and kind of put that on, on its own autopilot. But for me, let's say that I spend $2,000 on a load of air filters for Caterpillar diesel engines or something. The only thing I know is that altogether there might be 170 units in that pallet and it might be worth 10,000 or something. I know that I can put the average sale price of each part is $59 or something or $60. I want to pay 20% of what I'm going to sell something for. I want that to be my cost, 20 to 30%. Each load that I buy, I can put a cost on each part and each inventory purchase I make, which is a bulk load. I set it as a separate store category in my eBay account. So that way I can see, okay, this is, Tampa Bay auction lot May, 2020 or something. I can go into my listings, active listings. I could see select that store category. I can see that the dollar amount of all that inventory. And on each individual listing, I could write into description somewhere, a little number that kind of tells me that this is my cost in that part. I'm sure there's much easier ways to do this. You could do this in Excel, but it would be so time consuming that it would almost not be worth it.
Griff: Because this is double data entry. You don't want to repeat yourself,
Alec Larson: Trusting eBay with all the data. I try to recoup my initial investment on everything I buy within two to three months. And I try to keep my total inventory dollar amount growing. That's like my guiding North star. It's really hard to do because some of my inventory it can take years to sell. It Is very long tail. Yeah. So it sounds unorganized.
Griff: It doesn't sound that organized to me. You have some way of knowing so that you can always go back and check.
Alec Larson: Exactly. And I think the main takeaway from that to sort of touch on is I really rely on the historic category in the eBay listing dashboard. When I buy a certain load of inventory, I always set that inventory. So it's organized. So I know that bundle, I have this much invested in it. I can see, okay, I've recouped that initial investment. Now I'm in the green with that. Or I can see if I bought the parts. If I pick them out individually and an order from say dealership, I can see what I paid the dealership for that part and immediately know, okay, I made 20% profit on this one. I know that. So that's, that's helpful. But I would say I really couldn't live without using eBay as sort of a frame for the bookkeeping. I guess you could say.
Griff: That was part one of my interview with eBay seller, Alec Larson. We'll continue with part two next week when Alec reveals his particular sourcing methods in greater detail. I'll put a link to Alecs eBay store larsonenterprises in the transcript for this episode, episode 127.
Brian: You've got questions?
Griff: We've got answers!
Brian: Our first question is from Mr. Dana Abbot.. And it's a shipping question specifically about unwanted combined shipping. Dana writes, "Dear eBay Podcast. My name is Mr. Dana Abbott. I only use the term Mister, because the last time I wrote in, I was mistaken for a female. No worries though. Happens all the time. Oh dear. We apologize. Dana.
Griff: I'll do my research next time. Brian: And we should not have assumed gender on the basis that the name will be more mindful in the future. Yes.
Brian: Dana goes on. My eBay user ID is traditional_hunter. My question is I recently sold three deer hunting tree stands And each tree stand comes in a fairly heavy large box and must be shipped individually. I should also state that the buyer had to pay for the shipping. The shipping calculator combined the weight and size of all three stands into one shipment and charge the buyer $30 for shipping. When I shipped the items, I had to create three separate shipments and was charged $16 for each. This caused me to have to pay $18 above and beyond what the buyer paid for shipping. Is there a way that I could have set up the shipping that would have prevented this problem? Thanks for your help. Love the show." Thanks for the question, Dana. This is part of the old combined Shipping Discounts Tool that we spoke of in a recent episode. Fortunately, there is a quick fix and it's one that every seller may want to check now before what happened to Dana happens to them.
Griff: So Dana, the shipping calculator is using your own settings for combined shipping discounts and applying them to your listing. That's what happened. That's why the three purchases were combined into one purchase. Now, in order to prevent this in the future, you'll need to either edit an existing shipping business policy, like the one for this deer stand listing, or you could create a new one to apply well to any relevant listings now and in the future where you don't want any of the multiple purchases to ever be combined into one shipment. It sounds like these deer stands are perfect for that. We'll tell you how to do it.
Brian: And it is easy to do this. Just go to Seller Hub listings and click on the link for Business Policies in the left-hand navigation. Once in business policies, select shipping policy to edit, or you can instead create a new one, fill out all the necessary information and make sure that the box for combined shipping discounts is unchecked. Give your new policy an easily identified name. For example, no combined shipping discounts, then save the new policy and we'll include an image of this in the transcript as well. Can then apply this policy to any appropriate listing where you don't want to combine multiple purchases into one shipping box.
Griff: Exactly. And another option too, If you just want to make this quick and the listing is still up, you can edit the policy that's in place for the deer stand listing. That would be just going to the revise button on the top of that listing and clicking it. And then when you're in the revised page, scroll down to the shipping section, click edit for the shipping policy and uncheck the box for combined shipping discounts.
Brian: There is another option, you know.
Griff: There is?
Brian: Yeah, the seller could check his settings for combined shipping discounts and make adjustments.
Griff: Of course, I forgot about that option. It's recently been upgraded by the way that tool, the old combined shipping discounts. So it looks different. So Dana, you should check the configuration for your current combined shipping discounts and adjust them as necessary. And you can find these at well, it's a long link and we'll put the link in the episode transcript. It's www.ebay.com/ship/P as in Paul, R F as in Frank P R F. For preferences, I suppose. There are two configurations you can adjust in that tool. There is a flat shipping rules set up and a calculated shipping rule set up. There's also an option for promotional shipping rules as well. Now, keep in mind that these settings are global. They apply to any listing where you offer combined shipping discounts. So for example, you can set the flat or calculated rules add or subtract a specific amount to shipping for each additional purchased item. This might work for your deer stand.I don't know the weight and the size, but it could.
Brian: So Dana, we encourage you to explore these settings, but in the meantime, the quick fix for your deer stand listing is to make sure that the combined shipping option for the shipping policy for that listing is unchecked.
Griff: The next question is from eBay seller, Wayne, who writes" Been listening for a while and loved the stories and great info. I get, I have a question about multi item listings. I often list items with a quantity of 10 to 20 in stock. As I sell through the listing, then shows the seven sold and 13 available and continues to count down and show that until it sells out. So my question is multiple. First, I feel that there is a value in customer seeing that I've sold X number and I have X number available. Does eBay account for that and rank it higher if that is the case, rather than an individual item or a listing with many but none sold. So that's his first question. Number two, I try to keep track and go in and revise the item and increase the quantity as I sell through so the listing never runs out, but is that the right practice or should I just let it sell out and then do a realist? If it is better to do the realist, is there a way to open back up the listing and update the quantity? If I do let the listing sell out to zero quantity available rather than just hitting the realist button? What is the best practice when you have multiples of the same item? Do you list them with a quantity available or do you just list each one? Thanks, Wayne ." Boy. A lot of questions there!
Brian: That was more than two, I think Griff.Yeah, but glad to hears he enjoys the Podcast. And I think I have the first part of his question. May I?
Griff: Yeah. Be my guest.
Brian: So Wayne, every time an item sells in a multi quantity listing the sale gives the listing an incremental boost in best match. The factor is called sales over impressions. The more sales from a multi quantity listing, the bigger the boost and ranking, as long as that listing exists and it can exist in two states, more in a moment. The sales over impressions number for that listing is in play. The more sales, the more solid the boost and ranking. Ending a multi quantity listing and relisting it will erase any previous sales over impressions data. So keeping that listing live is critical.
Griff: Very good. Brian, I didn't know, you knew so much about this.
Brian: I know a few things.
Griff: So Wayne different sellers employ different quantity, available strategies. Some sellers like to keep the visible quantity available amount, low to help increase urgency to purchase among buyers. Now, other sellers are not concerned with the visible quantity available mounts. A seller has the option to select a display that states more than 10 available for quantity available number, or they can just show the quantity available. These are sellers who have a lot of quantity of one item to sell, and it's not a matter of urgency.
Brian: Right. Some sellers have items that go in and out of stock. For example, based on seasonality. Sellers of these items, don't want to lose any previous sales over impressions data for a listing,. There is an option a seller can employ called stockout. If the toggle for this option is set to yes, a fixed price listing that goes to zero quantity will not end, but will instead show a quantity of zero with an indication that says this item is out of stock. As long as this listing is in the out of stock status, it will not return in any searches. Once the seller adds a quantity to the out of stock listing, the listing will resume with its previous sales over impressions0 data in place.
Griff: Yeah. And one other caveat, if a seller toggles, the out of stock option yes, it will cover all fixed price listings, including those that had a quantity of one. Some sellers find this confusing since out of stock listings will show up in the active view on Seller Hub leading those sellers to believe there's zero quantity listings are still available for purchase. They are not. So for sellers who rarely offer a multi quantity, fixed price listing it is probably best not to use the out-of-stock option. But if a seller has significant numbers of multi quantity listings that by nature go in and out of stock, that seller should seriously consider using the out of stock option. Brian, how does Wayne find these settings?
Brian: He can find the pages for changing these settings by this navigation. My eBay account, the account tab, I should say. And site preferences. The settings for quantity display and stock out are at the top of that page. And we'll put the links for the pages in the transcript for episode 127.
Griff: Thanks again, to both our sellers for sending their questions to us. They were really good questions.
Brian: And if you have a vexing question about selling or listing or anything eBay related, why not call it into us at (888) 723-4630.
Griff: Yes. That vexing little number (888) 723-4630. And if you're one of those shy persons who prefer not to call, you can always email us at podcast@ebay.com that's podcast@ebay.com
Brian: Two options, phone or email.
Griff: And now it's time for your weekly Podcast To Do List reminder.
Brian: First, then always check the Announcement board for up-to-date Seller News and always check your email for email alerts or updates as well.
Griff: Do you need help setting up your thermal printer? You know, the one you bought on my recommendation?
Brian: No, not that again.
Griff: if not, why not send us an email or call us and we'll walk you through it here on the show.
Brian: What is this the eBay For Business technical support podcast? And finally, always check out the transcript for this and all episodes for follow up on what you've heard and to see the links we referenced during the episode.
Griff: Now on our next episode, we'll have part two of our conversation with eBay seller, Alec Larson. On part two we'll talk about how he sources products for his eBay store.
Brian: We'd like to, again, thank our guests this week, Mr.CustomerService, Tim Chapman and eBay seller, Alec Larson.
Griff: It's again, Brian, we'll see you again for episode 129 in two weeks.
Brian: Yes, 129, two weeks. I'm I guess I'm an oddball. I'm on the odd numbers.
Griff: I didn't think of that. Yes. I.
Brian: 'll be here and thanks to our regular listeners without who there would be no Podcast.
Griff: So true. The eBay For Business Podcast is produced and distributed by Libsyn and podCast411.
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The eBay for Business podcast is published every Tuesday morning and is presented by eBay, Libsyn and Podcast411.
