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Sourcing the Best Products to Sell on eBay, Amazon

Expert shares his step-by-step buying strategy.
best products to sell on ebay

Can you source the best products to sell on eBay, Amazon or elsewhere online almost methodically via a step-by-step process?

Considering how important sourcing is to your business, yet how challenging it is, perhaps a step-by-step process would be a good thing.

Recently, we interviewed someone who has reduced sourcing to just such a process. He’s Nick Spence, the marketing coordinator for AmazonGenius, a website for eBay and Amazon sellers that focuses on the latest news, and selling tools for things like repricing, inventory management, shipping, funding, and outsourcing.

Spence is also an ecommerce merchant himself, and he shares his sourcing strategies below.

There really is no wrong way to source products if you can find something to make a profit from

The power of cross-reference

Schepp: Nick, please summarize the manner in which you source products.

Spence: I do my sourcing very differently. Essentially what I do is this: I cross reference Amazon’s bestselling list with manufacturers on Alibaba.com and AliExpress.

Once I find an item that has a high profit margin and doesn’t have many competitors, I buy it and list it on Amazon. Usually I will start out by purchasing one or two of them on AliExpress to see how quickly they sell. Once I know they’re selling, I will then buy in bulk from Alibaba.com.

Maybe I’m old school, but this method has worked very well for me.

Schepp: You refer to yourself as ‘old school.’ In your estimation, are sellers sourcing in less methodical ways than you are? How do you feel most people are going about it?

Spence: Everyone sources products differently. Some like to scout products by visiting local retail and flea markets, while others like to scour the U.S. finding the latest blowout and discount stores.

Packaging pictures are extremely important when contacting overseas manufacturers because they help identify if the manufacturer has the real product or just a knockoff

There really is no wrong way to source products if you can find something to make a profit from.

Knowing the products

Schepp: Please describe the sourcing steps you take in detail.

Spence: As I mentioned, when sourcing new products I tend to look at the bestselling categories on Amazon.

From here, I am better able to gain an understanding of which products are popular, how much they’re selling for and what the competition is like.

The first thing I do is create a list of items I’m interested in selling from Amazon’s bestselling list. I tend to save the product pictures to a folder including packaging pictures of each particular product. Packaging pictures are extremely important when contacting overseas manufacturers because they help identify if the manufacturer has the real product or just a knockoff.

The next step I take is to cross-reference these Amazon products with products on Alibaba.com. I tend to email manufacturers my entire list of products I’m interested in (the ones in the picture folder), and see what they can do.

Once I’ve established a price per item with a manufacturer, I compare these prices with other Alibaba.com manufacturers. Once I’ve found the right price, and right manufacturer, I purchase a couple of these items via AliExpress.

Editor’s note: Through AliExpress, which is an Alibaba.com offshoot, sellers can buy products in smaller quantities than through the main Alibaba.com site at wholesale prices.

The reason I purchase from AliExpress first is to test the product out. I want to see how quickly it will sell before I commit myself to buying it in bulk. Why gamble with your money when you aren’t even sure the product will sell?

Once the first item starts selling, I immediately contact my manufacturer and make a medium-sized order

After receiving my test products from AliExpress, I then list them on Amazon.

I don’t worry about the profit margins while using AliExpress because I already have a manufacturer who can provide me with a great deal.

Once the first item starts selling, I immediately contact my manufacturer and make a medium-sized order.  Although I wouldn’t recommend sourcing products entirely from AliExpress, it’s a great way to see if your product will actually sell without having to gamble your money away.

Getting a great deal on inventory does no good if the item doesn’t sell.

Questions are important

Schepp: You mention the global sourcing platforms Alibaba.com and AliExpress. Can you tell us a bit about the best ways to work with these platforms?

Spence: I’ve had success and failure using both Alibaba.com and AliExpress.

When I first started using Alibaba.com I had absolutely no idea what I was doing. All I cared about was finding the manufacturer with the lowest minimum order quantity and the lowest price. Now I ask manufacturers more questions, such as for references and samples.

I also ask to see photos of products in their complete packaging so I know exactly what I’m buying. When dealing with Alibaba.com, it’s all about the questions you ask them. I also recommend only using PayPal when dealing with Alibaba.com. Sure they may add an additional fee, but you always know you can get your money back if anything happens.

Although I use AliExpress merely for testing, I love how the site is set up. If you buy something and the manufacturer doesn’t ship it on time, you can immediately cancel the order.

Sellers on AliExpress are graded on feedback and seller rating similar to Amazon and eBay, which gives buyers more control

If the item shows up broken or not as described, you can easily dispute the sale and get your money back. Plus, sellers on AliExpress are graded on feedback and seller rating similar to Amazon and eBay, which gives buyers more control.

‘Start slow’

Schepp: Is there anything else you’d like to say about how you source, and how it compares to the way others source?

Spence: Find a sourcing method that works for you, your time and your wallet. Start slow and see what works.

Don’t gamble your money away by buying products in bulk you aren’t even sure will sell. Just because you have an idea, doesn’t mean it will actually sell. Do your homework on your competition and products before committing yourself to buy anything in bulk.

When dealing with manufacturers on Alibaba.com or AliExpress, never let them intimidate you or make up your mind for you. Take your time and start slow.

Find a manufacturer who sells quality products and ships on time at reasonable prices. Once you find trustworthy manufacturers to work with, you can begin to order more products without taking the gamble.

Thank you for your time, Nick!

About the author

Brad & Debra Schepp
Brad and Debra Schepp are the authors of 20 books, including eBay PowerSeller Secrets and The Official Alibaba.com Success Guide: Insider Tips and Strategies for Sourcing Products from the World's Largest B2B Marketplace. Their most recent book is How to Find a Job on LinkedIn, Facebook, Twitter and Google+. Brad is also a literary agent for Waterside Productions. For further information, visit the couple's website, bradanddeb.com. Opinions expressed here may not be shared by The Online Seller and/or its principals.

  • jbmalik

    Great article, I think it’s one of the first that sheds some light on Alibaba (I ordered from them before and it was a disaster, now I know how it’s done the ‘right’ way). I teach other eBay/Amazon sellers how to source with my e-book http://Blesha.com (how to ‘buy low on ebay and sell high on amazon’) and I have a bunch of free ideas over at http://SourceAzon.com .

  • http://www.facebook.com/connie.pickerill.7 Connie Pickerill

    I ordered some Zumba DVD sets a couple of years ago that were selling like hotcakes on eBay. I thought Alibaba was secure because it was recommended by Auctiva. I ordered from a Gold Supplier. I listed five sets and they were doing great then they disappeared…removed by eBay for being counterfit. They were identical to the ones selling on eBay. The seller would not send an RA. He said it was not his fault that I couldn’t sell them. Thankfully, I had used my Discover card so I got my money back. So be careful with Alibaba and Ali-express. I have 50 sets I cannot sell.