Absolute Beginners Guide to Launching an eBay Business

Let's start with the "white collar " part of your eBay operation ”your home office. This is where you'll perform all your online operations and manage all your paperwork.

We'll look at all the parts of your home office separately, but let's start by going over a checklist of the major items you'll need:

Personal Computer

A decent personal computer system is a necessity for any eBay business. After all, you need the computer to get online and manage your eBay auctions!

How fancy a computer do you need? Fortunately, not too fancy. Your computing needs will be fairly modest, so you don't have to spend a lot of money on a state-of-the-art powerhouse PC. In fact, you can probably get by with one of the lowest -priced models available ”or just use your existing PC, if you already have one.

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What kind of PC are we talking about? Here are the minimum specs I'd consider if you're looking to buy a new PC:

• 1.5GHz Pentium or Athlon family microprocessor

• 256MB memory (RAM)

• 40GB hard drive

• CD-R/RW drive

• 17" CRT or 15" LCD monitor

• Windows XP Home Edition operating system

In today's market, you can find a PC that fits these specs for well under $1,000. (And if you're an Apple fan, similarly featured Macintoshes are also easy to find.)

Naturally, you should also outfit your PC with the right type of modem for your Internet connection, which we'll discuss in a few pages. That means a traditional modem for a dial-up connection, a cable modem for cable broadband, or a DSL modem for DSL broadband.

If you have more than one PC in your business (or want to connect your business PC to another home PC), you might want to invest in the appropriate equipment to network your computers together. Your network can be either wired or wireless; the easiest solution is to buy an all-in-one networking kit that includes all the equipment you need to assemble and configure the network.

You can shop for a new computer in a number of places; just about every type of retailer carries computers these days, from Wal-Mart to CompUSA and everywhere in-between. You can even find good buys on brand-new (but often close-out ) PCs from fellow eBay merchants .

That said, you should buy at a retailer with which you're comfortable. Look for a decent selection of models from a variety of manufacturers, good pricing (of course), knowledgeable salespeople (harder to find), and after-the-sale service and support.

"Mike Sez"

Computer Software

You'll use your PC not only to access the eBay Web site, but also to manage all your auction transactions and your business's record-keeping . That means you'll need to install the appropriate computer software for your business needs.

What software do you need? Table 7.1 shows what I recommend:

Table 7.1. Recommended Computer Software

You should also consider a decent backup program, to create backup copies of all your important customer and accounting records. At a bare minimum, you can use Microsoft Backup (included with Windows) to regularly back up your data to CD-R/RW discs. If your backup needs are more sophisticated than what Microsoft Backup can achieve, check out Handy Backup (www.handybackup.com), NTI Backup Now (www.ntius.com), or Retrospect Backup (www.dantz.com). Or you can use an online backup service, which lets you back up your files online to a separate Internet site; this way, if your office burns down, your key files are safely stored offsite. Some of the more popular online backup services include @Backup (www.backup.com), Connected (www.connected.com), IBackup (www.ibackup.com), and Xdrive (www.xdrive.com).

Printer

One of the key components of your computer system is your printer. You'll be printing lots of invoices and labels, so there's no point spending the money on a color printer; buy a good black-and-white model that can handle a heavy printing load.

You'll need to choose between inkjet and laser printers. Inkjets are lower priced, but could end up costing you more in the long run; all those replacement ink cartridges add up, over time. Laser printers cost more, but are faster and better suited to heavy printing loads. If you think your eBay business will generate a high volume of sales, a laser printer is probably the way to go.

Digital Camera and Scanner

You might not think of these next items as absolutely necessary ”but you'd be wrong. You need both a computer scanner and a digital camera to capture images of the items you'll be selling on eBay.

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A scanner is good for flat items ”CDs, books, small packages, and so on. A digital camera is needed to capture three-dimensional items. Both pieces of equipment save their images as digital files, which you download to your computer's hard disk. Once stored on your PC, you can edit the pictures with your image editing software, as you'll discover in Chapter 19, "Working with Photographs."

What kind of digital equipment should you buy? The scanner is relatively easy; go for a decent flatbed scanner, something in the $100 “$150 range. Choosing the right digital camera is more complex. You can find models as low as $150 or so, or as high as $1,000 (or more!). Fortunately, your needs are modest. You don't need a camera with lots of megapixel resolution; the pictures you post on the Web will be low-resolution JPGs. Look for a model that's easy to operate and ( especially if you plan on selling smallish items) includes a macro or close-up focus capability. You can probably find what you need in the $200 range.

Internet Connection

As you manage your eBay business on a day-to-day basis, you'll find yourself connecting to the Internet a lot . For that reason, you may not be happy with a traditional dial-up Internet connection. As you probably already realize, a dial-up connection is slow (56.6 kilobits per second) and cumbersome (you have to make a new connection every time you want to go online). For your new eBay business, something better might be in order.

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That something better is a high-speed broadband Internet connection. A broadband connection can speed up your Internet access by 10 times or more ”plus it's always on, so you don't have to waste time dialing in to connect. Whenever you want to check your eBay auctions, just launch your browser and you'll be connected to eBay almost instantly.

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Telephone and Fax

Your home office needs its own communication system ”and that means more than just email. You'll need a separate phone for your office, even if that phone shares your home line. (You can choose to invest in a separate business phone line, but that's probably not necessary unless you generate a large volume of outgoing or incoming calls.) Consider a phone with a built-in answering machine or access to some sort of voice mail system, so that you won't miss any calls when you're away.

If you do decide to go with a separate business phone line, invest in a two-line phone. This way you can run both your home and business lines into the same phone, and use either line as necessary. You can find a good two-line cordless phone for less than $200.

Another option is to use your cell phone as your business phone. This is a good way to keep your business calls separate from your personal calls. This is also a good idea if you need to remain in contact with the outside world even when you're not in the office.

You may also have need of a fax machine. While a separate fax machine will work (and, with the proper devices, connect to your regular phone line), a better solution for many is the all-in-one printer/fax machine we discussed earlier. If nothing else, an all-in-one machine takes up less desk space than separate printer and fax machines.

Filing System

In the course of running your eBay business, you're going to generate a lot of records. Many of these records will be electronic, which are easy to deal with by using the appropriate software program. However, you'll also generate a fair amount of paper records, which you'll have to keep on file.

Short- term paperwork probably needs to stay on top of your desk. You can employ the "multiple pile" method of desktop filing, or go the more organized route and use a series of desktop baskets and organizers. I recommend the latter.

For your longer-term paper storage, nothing beats a good old fashioned filing cabinet. Go for either a two- or a four- drawer model, and keep things organized with the appropriate filing folders. You don't have to buy anything fancy, either; those low-priced metal filing cabinets work just as well as expensive wooden ones.

Furniture

The subject of filing cabinets brings us around to a bigger issue ”office furniture.

The biggest and most obvious piece of office furniture you need is a desk. Your desk has to be big enough to hold your computer, printer, scanner, and other equipment, and still provide enough desk space to let you spread things out and do a little paperwork. That probably rules out using a folding card table ”although some swear by the old wooden-door-laid-on-top-of-two-filing-cabinets approach. My personal preference is an L-shaped desk with filing-cabinet drawers on either end; I put my computer equipment on one side of the L, and use the other side for desk-based paperwork.

Another option is to go with a smaller desk and a separate computer stand. In any case, just be sure you have enough space for all the different kinds of office work you'll be doing.

Of course, you need a place to sit while you're doing all this work. Your office chair is maybe more important than your desk, in that it directly affects your physical comfort . Choose the wrong chair and you could end up either uncomfortable or in physical pain. And since we come in all different shapes and sizes, it pays to get a chair that adjusts to your own personal preferences ”and to test-drive any chair before you buy it.

We already discussed filing cabinets, but you should also consider whether you need a bookshelf or two in your office. If you find yourself frequently referring to printed matter ”like this book, for instance! ”then by all means include a bookshelf in your office plans. Remember, your bookshelves can hold all types of books, from dictionaries to phone books to software instruction manuals. If you need one, get one.

Your local office supply store should have a good variety of furniture to choose from, at affordable prices. Also good are retailers like Ikea or traditional furniture stores. If you're on a tight budget, consider buying your furniture second-hand . Check out the "previously used" section at your local business furniture rental store, or keep an eye out for businesses that are going out of business. (A lot of entrepreneurs were able to snatch up fancier-than-normal furniture when all those dot-com companies went bust!) Naturally, eBay is also a good place to look for these kinds of bargains.

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Office Supplies

Don't forget to stock your office with all the odds and ends you need to conduct your daily business. Your personal needs may differ , but here's a starter list of the office supplies you're likely to need:

You should find space in your immediate office for those supplies you'll be using on a regular basis. Additional quantities can be stored somewhere less convenient .

Configuring Your Space

Of course, you have to have enough space to put all this new equipment and furniture ”and that space has to be conducive to actually working. It won't do to place your home office in the corner of a busy living room; you need to be able to separate your work life from your personal life. That might mean utilizing a separate room ”preferably one with a door you can close.

How much space do you need? Think through all the equipment you'll have, then add an appropriate amount of clean desk space to write checks and spread out a few file folders. Make sure you have enough room to actually roll or walk around comfortably. Then take this total space ” and double it . That's right, you'll always end up needing more space than you think, so you might as well plan for it from the start. Over the next several months you're bound to buy more computer equipment, add extra filing cabinets, or need to store something that you hadn't planned on. Plus, you might actually have visitors ”and where will they stand or sit? Your home office has to be comfortable, so don't start out cramped. Whatever space you allocate, you'll end up filling it!

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And where, pray tell, should this space be located? This is definitely a personal decision, and one that depends on what space you have available. I definitely don't recommend carving out space from a high-traffic public area. It's better to find a spare bedroom or area of your basement that you can partition off. Worse comes to worst, you can use a corner of your bedroom ” assuming , of course, that it's a room that is otherwise vacant during working hours.

Another option, of course, is to rent office space outside your home. While this might sound appealing (especially if you want to get away from the kids while you work), it's expensive and not typically necessary. Still, if you can find affordable space nearby, it's worth considering.

After you stake out your space, make sure it has enough electrical outlets for your needs. Consider everything you'll be plugging in ”your computer, monitor, external modem, printer, scanner, telephone, desk lamp, whatever ”and make sure there's a plug for everything. And, while you're at it, make sure you have the appropriate phone and cable jacks for your telephone, fax, and Internet connections.

You should design your workspace with you in the center. Put your most important task ”your computer ”right in front of you, and everything else within reasonable reach. In this aspect, it pays to think vertically . That means incorporating a series of shelves above your desk, rather than spreading out sideways from your working area. There are lots of innovative storage options available that let you expand your workspace up instead of out.

Ergonomics are also important. You want everything in your office to be within comfortable reach. You should pay special attention to the relationship between your chair, computer screen, keyboard, and mouse. Consider one of those split ergonomic keyboards, such as the Microsoft Natural keyboard.

You should also pay attention to light. Your office needs to be well-lit ”and that means more than a small desk lamp. Natural light is always good, if you have a window nearby, but appropriate artificial lighting is also necessary. Consider a combination of uniform and task lighting ”which probably means both a floor or overhead lamp and a desk lamp. And you don't have to make do with flickering fluorescent lighting, either; you can upgrade both desk and floor lamps with full-spectrum bulbs that simulate sunlight.