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Pandemic boosts eBay self-made millionaires by 35% year on year
There are more eBay self-made millionaires than ever before – the number has risen by 35% in the last 12 months as British entrepreneurialism continues to thrive despite challenging trading conditions prompted by the pandemic… or maybe because instead of despite as the high street was shut for part of 2020 and online was the only way to shop.
An eBay millionaire is defined as businesses trading on eBay UK with revenues of £1 million or more generated through the online marketplace. Comparing last year to this, in the Oct 2018 to Sept 2019 period there were 782 new eBay self-made millionaires but this rose for the period Oct 2019 to Sept 2020 to see 1058 new eBay millionaires added to the roster.
“I started Hugglepets with my dad eight years ago on eBay. What started out as a small business has now grown to an 18-person operation and a huge warehouse full of stock. Following the success of our online business, we have even managed to open a bricks and mortar shop on the high street. Hitting the million-pound turnover milestone was a huge moment for us and I’m proud of our team for continuing to operate in the pandemic, too. The coronavirus pandemic actually gave our business a boost, as customers had more time to research and invest in new products for their pets.”
– Mike Dixon, founder, HugglePets and eBay millionaire
eBay self-made millionaires capitals
The data also reveals the “eBay millionaire capitals” across the UK – the cities that have created the most eBay millionaires in the last 12 months. While London tops the list with 52 new eBay millionaires coming out of the capital last year, cities in the North and Midlands dominate the top ten list. The top ten eBay millionaire capitals include:
- London (52 new eBay self-made millionaires)
- Manchester (36 new millionaires)
- Birmingham (35 new millionaires)
- Leeds (14 new millionaires)
- Bradford (13 new millionaires)
- Leicester (12 new millionaires)
- Rochdale (11 new millionaires)
- Glasgow (10 new millionaires)
- Bolton (9 new millionaires)
- Oldham, Nottingham & Halifax (each with 8 new millionaires)
“I started out selling everything I could on eBay, but realised that the swimwear and underwear I offered was much more popular than anything else. I decided to set up Belle Lingerie while raising my three children, with my dad initially helping out by packing and posting items to be shipped. Today we employ 20 permanent staff and our turnover is in the millions. It’s fair to say that the pandemic did affect us, but where we lost sales in categories such as swimwear, we saw a huge growth in athleisure and loungewear, which overall helped our business thrive.”
– Janine Dutton, founder, Belle Lingerie and eBay millionaire
When it comes to the most lucrative product categories for eBay entrepreneurs, the top ten list reflects consumer spending trends of our “new normal”, including a rise in the number of Brits taking on home DIY projects and working remotely, as well as a boom in Brits getting in shape and recreating salon experiences from home. The top ten categories for eBay millionaires include:
- Home, Furniture & DIY
- Vehicle Parts & Accessories
- Clothes, Shoes & Accessories
- Business, Office & Industrial
- Health & Beauty
- Sporting Goods
- Garden & Patio
- Computers/Tablets & Networking
- Mobile Phones & Communication
- Sound & Vision (e.g. TVs, smart glasses, speakers)
“We started our business, AwesomeBooks, after realising that many books from charity shops end up going to waste due to the sheer volume of donations they receive. We spotted an opportunity to start a business selling second-hand books, while also giving charities well-needed funds to take stock off their hands. AwesomeBooks has grown immensely over the last 17 years, and we now ship 6,000 books per day through our eBay store. From small beginnings, our turnover is now expected to reach £25m this year. Lockdown meant that sales of our books went through the roof. It seems like our customers used their spare time to read their “bucket list books” and find sources of entertainment for children.”
– Mubin Ahmed, foundern AwesomeBooks and eBay millionaire
As the cost of Covid-19 on businesses is fully realised and the UK prepares to enter into a recession in the coming months, eBay predicts growing economic uncertainty will create a new wave of “post-pandemic entrepreneurs”.
“The uplift in new self-made millionaires on eBay proves that Britain’s entrepreneurial spirit is alive and kicking, despite the challenging economic times we are facing. The pandemic has certainly hit business hard, but it has also shown that entrepreneurs are cut from a different cloth and can turn a crisis into an opportunity, making millions in the process. It is these forward-thinking small businesses who will help power the UK’s economic recovery and thrive in the long term. That’s why eBay is committed to providing a platform for these side-hustlers, lockdown start-ups and entrepreneurs, helping to deliver growth for the economy and communities across the UK.”
– Murray Lambell, UK General Manager
Labelling sellers with a million revenue as millionaires doesn’t make any sense.
Sadly they need to make out every seller on eBay is doing well to encouraging others to try, they have been doing it for years.
Margins on eBay are terrible at the moment, you’d need a turn over of about 50 Million to make 1.
Whats 35% of 3 ?
As per the article 35% (NOT of 3) is 1058
Without knowing their profit margins, this story is utterly meaningless.
Turnover is vanity. Profit is sanity. This is something ebay still doesn’t seem to understand!
Thing is if your business has big turnover then it’s even better for eBay!
I will use this article to encourage and try and spark my kids’ entrepreneurial spirit and become successful online sellers, as I have done.
With encouragement, excitement and a bit of a plan anything is possible.
I really don’t understand all those that come on places like this and just moan. I think they must be in the wrong game.
They fail to omit some of these sellers have good physical retail outlets as well as prominent websites. I’m sure eBay is good at generating extra volume but i can see it generating a lot of margin.
I’m sure eBay is good at generating extra volume but i CANT see it generating a lot of margin.
Yeah, but they are trading 1 product, and not dealing with the heap of nonsense normal retailers are.
I just think the margins are very slim
take a sale for 9.99 and 1kg
After eBay fees, Sponsered listing fees (5% at least), Postage (48 £2.71 exc vat), packing, warehousing.
Then actually buying the item and effort in handling it, unloading, shelving etc.
Your left with Jack.
You could raise prices and sell nothing off course and let all the sales goto some Chinese sellers, but that just increasing your warehouse costs even more.
The sad part is, that’s prob a best-case scenario, whos got sponsored listings at 5% that actually work.
Give it a rest ifellow.
You are now dominating every thread on here with your negativity and hatred of ebay. Why Tamebay allow it is beyond me as you are the opposite of inspirational for the platform.
Post after post after post. 80% of the posts above are all you and your trash comments of your fellow ebeyers and the platform. Victor isn’t much better.
You cant make ebay work, that much is obvious. but you attack any idea that is even trying to make it work.
I remember coming on Tamebay to get inspired …………
All his examples are wrong as well 🙁
I’m no “ebay millionaire” but have 100s of items a month that sell around that price of £9.99 and they each make somewhere between £2 to £4 net profit, or more if buyers purchase multiple items. Sponsored listings do not have to be set at 5% or higher to achieve this.
There may be categories where it is impossible to achieve this, like whatever ifellow sells, but there are plenty others where it can be done.
‘Britain’s entrepreneurial spirit is alive and kicking’ – Love that line, you can’t beat us Brits for bouncing back from tough times!
The key is an innovative product that catches peoples attention, eBay is a great platform for getting your product out there and coping with scale in a way that is very difficult to do on your own.
All things are possible. Much is perseverance, much is the luck of being in the right place at the right time, much is being willing and able to take advantage of opportunities when they show themselves and much is being willing and able to proactively seek out such opportunities. So far, we are thousand-aires working our way to the hundred-thousand-aires. We will Persevere. We will put ourselves in the right places at the right time and be willing to take advantage of opportunities. The more and better we do, the more and better will be the opportunities of which we may take advantage.
I DO take some pause at the lack of proofreading in the article. The very first thing the viewer sees, the title, is either very poorly worded or misspelled. “boost” should most likely be “boast”.
Good luck making a living wage on margins of £2.00 an item with all the returns and postal costs . The major reason Ebay is such a mess in 2020 is because of idiot sellers like you.
Boy…i wish there was a keyboard stroke i could press that would give you a slap and say wakeup and get your prices increased so we could all make decent margins
I think is margins are based around not paying VAT and sending large letter.
Anything that’s 1KG at 9.99 and you purchased for £4.00 or more, is a loss.
He says i can’t do the math.
Don’t need luck, but sarcastic thanks anyway. I’ve been running my business 10 years and I’ve been selling on ebay since last century. I know what I’m doing and how to do it well.
Note that I said net profit and was referring only to items around the £9.99 price point, so a net £2 would be 20% and £4 would be 40%. When selling higher priced items, or orders of multiple items, the aim is to repeat those percentages.
Those are perfectly decent margins and if you google what is a good net profit margin UK (like I just did out of interest), top of the listings might be:
“A good margin will vary considerably by industry and size of business, but as a general rule of thumb, a 10% net profit margin is considered average, a 20% margin is considered high (or “good”), and a 5% margin is low”
So by those standards, I’m smashing it out of the park. Not bad for an idiot seller. And if those are my margins, I can’t exactly be rock bottom prices as well, can I?
As for returns, I just don’t get that many to worry about, or make even a tiny dent in the ebay profits.
Guess it depends on what you sell and what your competition is. I sell quite a lot of customer return stock and sometimes the only person who has that item so can charge a good price for it and make good money. The brand new stock I sell, sometimes on Amazon there are 12 other sellers competing and racing to the bottom.
If it is a popular product I let them get on with it, wait for them to sell out and once they have prices go back up again once the wholesaler is out of stock. I tend to do much better with the end of line clearance or past season stock as less competition and better profit to be had than competing with the big high street stores and competition online happy to make a few pounds on each sale.
Are you really sure on those margins. Add in Ebay Fees, Managed payment Fees, Promoted Listing Fees, Postage Fees, Return Fees and Warehouse costs.
You must be running around like a blue arse fly to make a living wage making 2 quid an item. Hope its worth the anxiety and stress
When it comes to ebay, a spreadsheet with cost of goods, fees, P&P costs and VAT means a sale price can be worked out properly and show what’s left as net profit. Tweak the sale price to make sure the net profit is acceptable. It’s that simple.
Some fees aren’t included in the spreadsheet I set up, like ebay PL fees. They’re set very very low and only apply to sales about 50% of the time, so you can’t apply it to everything accurately. It still needs to be considered, however, I don’t include the ebay TRS discount in the spreadsheet either. The 2 roughly cancel each other out though, so that works out just fine. As for returns, they are so low for me, that’s it’s not worth worrying about. It’s just a very small amount that comes off the bottom line at the end of the month.
Warehouse costs aren’t something that can be factored into individual sales, rather, you’ve just got to look at that as a cost of doing business as a whole. As long as you sell enough, it’s not a problem. I don’t even have to run around everyday like a blue arse fly to do it. Only some days 😀
As for the £2 profit fixation, this is not a typical per item profit. That was an example of the lower end profit on sales in the £10 region, referring back to ifellows “you can’t make money on £9.99 sale items” post. Other times it might be £12 profit from a £24 sale. It varies, but the margins are all good.
I never said you can’t do the math, rather that your examples are wrong.
if someone buys an item to resell at £4 that needs to go as a parcel and the selling price is £9.99, they’re not going to make much. If anything, they may make a loss. But if the items costs £1.50, or £2? That means profit and that’s why your example was wrong. That’s why and how sellers can sell at £9.99, all day long, making a profit while they do. You assume a cost price that is too high. You assume margins are low. Wrong. It can be done at that price, sending as parcels, all VAT and above board.
Im sorry im not having your numbers. List your item with all costs on here including vat with a promted fee at 5 percent and you will find your numbers dont stack up.
What you dont mention with margins as low as that is what happens when your item dosent sell. Result a net loss
Derek, you need to set yourself up a spreadsheet, then you’ll have less problems with numbers.
I’ll give you an example of one from mine
sale price £10
cost of goods £1.50
Ebay fees* £0.89 (*TRS discount applied and yes, it’s a low fee category)
Profit = £3.21
Even if PL fees applied at 5% (they’re not 5% and only apply about half the time) that would knock off roughly 50p, so still £2.71, from just a £10 sale.
What about the costs if they don’t sell? They do sell though, multiple times, every month. Even if they didn’t sell that frequently, even in the worse case, no ebay shop, 30p a time listing fee scenario, they’d have to take about a year to finally sell to make a net loss on fees.
This wouldn’t work for all items. For one-off listings, the set up would outweigh the profit. If they took too long to pack, that would also outweigh the profit (I’ve dropped some listings for this reason). But if they are bought at the right price, can sell for the right price, are easy to pack and repeat sellers, then that’s how it’s possible.
The majority of sellers dont in the slightest have stock for £.150 they sell for £10. I cant see it myself, you are clearly in a lucky position if you have various stock you are able to mark up like this and sell in volume.
The point I was making which you failed to miss is. Sure an item that costs £5 should retail at £15.
But realistically this never happens on marketplaces.
If you have a product that costs 1.50 and your selling for 9.99 without much competition and VAT evading Chinese sellers, then good for you. But I’d argue the majority of sellers are not in this position. What I sell for example, is flooded with Chinese sellers, there are more than domestic sellers.
If your making these margins buying a few units from a UK wholesaler then your even luckier.
I havent seen these type of margins ordering from the factory door 1000s of units a time, as the factories are practically here selling tax free already and have done for 5 years.
Dont forget having to buy so many units adds costs like
Unloading, warehousing and youd need an accountant, possibly a van and prob other things I’ve forgotten.
Some people may find it ‘unmotivating’. But the margins are very thin.
Yes, Chinese sellers, business sellers pretending they’re just private sellers, duplicate accounts, VAT evaders, these are all bad. And I see them too in the same categories I sell. If I’m selling something at £10, someone else is probably doing £9 or £8. But it is possible to get things at the right price, sell at a reasonable price, make a decent profit. And I can’t be the only one doing it.
As for warehouses, vans, staff, etc, these are overheads that any business selling physical goods has to handle when they get to a certain size. You just start the month on a negative figure due to those costs, and as the month goes on, as sales roll in, you pass neutral and move into positive. By the end of the month, it’s all good.
Thank you for that. I guess if you can get stock delivered from where ever at £1.50….it can work
For Myself, if i buy my stock at £1.50 an item i have to add shipping costs, vat and import tax from Thailand. Note this is where my suppliers are from.
All in all a £1.50 item costs £3.50 to get to the UK.
On a serious Note if you want some newlines and are happy with 20 percent margins let me know you can buy my stock together with my own copyrighted designs…myself i had enough of online selling. I liked it when margins where 150 percent but have no energy for 20 percent margins
The item in that particular example was UK sourced and included delivery cost, though I import too. It’s expensive, but it pays off.
I’d imagine your lines with 150 percent margins were very nice before dropping to 20, but it’s not something I’d look to take on. My business isn’t just ebay or online sales, so any new products, need to be what I do, rather than just sellable.
Hope you can find something else to sell online with that level of margin again. I’ve had to drop product lines that were once good too. It’s just the way it seems to go.