TulipTools Internet Business Owners and Online Sellers Community

Quote:FACT #1 People buy things, use them, retire them, and potentially replace them. This is nothing new, and will continue as long as we are called consumers.

FACT #2 The internet is the broadest medium in existence, so if you market something on the internet, it will have the widest reach (this statement is platform neutral).

FACT #3 People are busy and are willing to pay for a valuable service. Similar to people that go to a car wash, there are a large percentage of people who are busy and are willing to pay for convenience. Keep in mind,...it's a lot harder to successfully sell something on eBay than it is to get out the hose and a sponge and wash your own car.

These three facts are the principle reasons why the drop-off store industry has such a large future...

full article: http://www.auctionbytes.com/cab/abn/y07/m05/i04/s05

Another point of view:

Quote:EBay drop-off stores rethink business model
As growth of eBay drop-off business slows, stores rethink their models

The get-rich-quick fantasy is fading for the eBay drop-off store business. The recent years' explosion of grand openings by independent operators and franchisors ready to help consumers sell the stuff in their attic online appears to have slowed as experience proves how hard it can be to make a profit.

California-based franchisor iSold It recently announced it would stop selling new franchises so it could focus on helping existing franchisees. The move came as the company faced complaints from ex-franchisees who set up a Web site to air their concerns that iSold It painted a too rosy picture of the prospects...

full article: http://www.post-gazette.com/pg/07123/782951-28.stm

A related survey from Auctionbytes:

Quote:Call it the paradox of eBay drop-off stores. A recent AuctionBytes survey shows that while 63 percent of storeowners say the business has not met their original expectations, the majority expects growth in the area of online consignment services. Thirty-one percent forecast high growth opportunities in online consignment services over the next 12 months, while another 43 percent forecast some growth. And with all the challenges of running a drop-off store, 69 percent of respondents said "educating the public" is one of their biggest challenges, and 42 percent said it is the biggest challenge...

A follow-up survey was sent to the 101 respondents asking specifically about profitability. Forty-three percent responded to the follow-up survey; of those, 74 percent said their store was not profitable after paying themselves a salary...

full article: http://www.auctionbytes.com/cab/abu/y207...bu0190/s02

Quote:These three facts are the principle reasons why the drop-off store industry has such a large future

With sell-throughs at 40%, as they've been for a long time, and more importantly, selling prices that continue to go down, I honestly don't see much future in it at all. 

Our local drop-off store seems to be doing quite well, as they're running 100-200 auctions a week.  (And if you ask them, they'll tell you how good ebay is!)

~BUT~

I know for a fact that many, MANY of their former clients will never return due to high expectations (the perception that ebay gets the best prices for everything), and low returns.  The fact is, if you just want to get rid of stuff, not caring what they sell for, then you'll be ok (mostly)... but if you want more than pennies on the dollar, you'll take your goodies to another venue, offline most likely.

Some of the most prominent pro-ebay posters on the ebay boards are consignment sellers, at least partly.  It's very easy to say just how good ebay is when you don't have any money in the product...

Cheers