eBayers Attain Risk-Free Profits

Business 2.0:

Like many mom-and-pop teams that sell on eBay, Cheryl and Gary Casper started with stuff lying around the house–baby clothes, old toys, even VHS copies of Cinderella and Sleeping Beauty that their daughters were still watching. “I was ripping them out of their hands,” Cheryl says. “I was, like, ‘I’ll buy it for you on DVD.’”

The Caspers’ quest to build a presence on eBay has paid off. Last month they sold $15,000 worth of products. But the really good news for them and their children: Their strategy no longer requires rummaging through their Houston home.

That’s because the Caspers now sell goods they don’t even own. They look for vendors that have too much inventory (ideally, hard-to-find merchandise) and then sell the stuff on eBay. The sweet part: The vendors hold the inventory until after the sale. The Caspers only touch the stuff when it’s time to mail it out. The couple’s product assortment might sound dull–they specialize in floor mats for Ford automobiles–but their inventoryless business model is amazingly efficient and virtually risk-free.

The Caspers have teamed up with a Houston-based auto surplus company that supplies them with a product list. Some days they put as many as 50 mats up for auction, at $16 to $125 a pop. Once or twice a week, they drive to the warehouse to buy the mats they’ve sold. The profit margins are as much as 75 percent, even after paying the dealer. “If I only wanted to make a few hundred dollars a day, I’d be done by noon,” says Cheryl, a former Merrill Lynch sales associate. Some days, she says, she and her husband make $700 in pure profit.