Tips for success with Private Label Products as part of your eBay business

I’m busy getting ahead of myself again, finding lots of ideas to help you make money on eBay and wanting to tell you much, much more than there’s space for in my weekly eletter!

And that is why today I’m going to provide an exciting introduction to a concept that helps you find unique, regular selling products for your business – without heavy investment and few risks of any sort to slow you down.

This concept revolves around what are called ‘Private Label Products’.

Private Label Products are sometimes called ‘unbranded’, ‘unlabelled’ or ‘white’ products, but they all mean essentially the same thing. PLP describes a product made specifically for other sellers to add their own labels and product packaging and market the goods.

It might be best to get started with Private Label Products by identifying bestselling products on eBay and Amazon – where competition is probably very high – and then look for similar or closely-matching private label products. Sellers have labels printed to add to product and packaging and they list the product as if it were entirely their own.

Private Label Products provide major benefits for sellers in excessively competitive markets, including:

  • Different product names and gallery images help sales items stand out from main competitors in marketplaces and outside site search returns.

To illustrate, imagine several pages of identical product listings appearing uninterrupted in eBay search results – and then out of the blue comes an altogether different listing.

That sudden burst of interest is enough to make a person open the new listing and read about the product and possibly make a purchase.

  • Sourcing costs are usually lower for Private Label Products and their new product and packaging materials than for similar items purchased wholesale from brand name suppliers. That helps sellers price their rebranded products below those of their main competitors, tempting first time buyers for their own new products.

When those customers like it – which they almost certainly will because the two products are basically the same – many first time buyers will become regulars.

Second and later purchases can be made outside of eBay, from the seller’s own blog or website, helping the seller avoid paying hefty eBay listing and final value fees.

  • Virtually any product and service can be acquired with a Private Label, including food and drink, health and beauty products, website design and hosting, pet food and accessories, greetings cards and stationery.
  • It helps brand a seller’s business and make it memorable to repeat buyers, as well as highlighting ecommerce site email and website addresses to generate back end sales to customers originally sourced through eBay.
  • Private Label Product owners can start their own affiliate programme or dropshipping business, as well as selling goods in wholesale quantities to non-competing sellers online and offline.

There are downsides to Private Label Products, too – but nothing to make them anything less than a great opportunity for most people selling on eBay, Amazon and other third party marketplaces.

For example, these points are certainly worth taking into account:

  • The new product might not reach its anticipated sales level due to a feature that can’t be copied from the base product. The original product may be patented, for example, or based on a copyright protected design.

Careful study of the base product should reveal all important product features and reasons for its popularity, as well as points that can not be applied to other products.

  • Private Label Products may have to be bought in high quantities to keep sourcing costs low and profit margins high. That can represent a major loss if the product doesn’t sell.

A way around this problem is to stock the lowest possible product to test the market and judge demand and optimise price. This might mean initially paying more for the product than the seller’s intended resale price. But if the product doesn’t sell, the seller doesn’t face major losses.

If the product does sell in high numbers, the seller begins buying in large quantities at substantially lower unit cost.

Note: AliExpress.com is part of Alibaba.com and both are the preferred Private Label Product suppliers for millions of sellers on eBay and Amazon. The first sells in low volume for sellers to test market a proposed new product; the latter offers similar products in high volume at discounts providing high profit margins. Key ‘private label’ into the search box at either site and you’ll find hundreds of products to choose from.

Tips for success

  • Make sure Private Label Products match consumer laws in your target market. Millions of Private Label Products are available from all over the world but not all are suitable for the UK market.

Some low-level drugs can be sold in the US, for example, but not in the UK and other countries.

Another example: toys sold in the UK must reach very high safety standards that do not apply in some other countries.

eBay gives useful advice here – but it is an important subject which I will cover in more depth in my free report next week.

  • Look at products selling in high numbers for other eBay – or other site – sellers. My favourite place to begin sourcing new products for my business is Goofbid.com. Choose ‘eBay Tools’ top of the home page and ‘eBay Most Popular Tool’ bottom right of the dropdown menu.

On the next page, key words into the search box describing the kind of product you’d like to sell. The page that follows will reveal products and listings matching your keywords, alongside number of bids (which actually means number of products sold) and prices.

Find a product that takes your fancy and click on the title taking you through to its eBay listing page and a much clearer image of the product.

Look closely for features that can and cannot be applied to a Private Label Product. When you’re sure you can introduce a new product to compete with the one you’re reviewing, you can begin searching for private label products and their suppliers.

Start with AliExpress and Alibaba because their stock is extensive and prices probably the lowest available. Buy as few Private Label Products as possible to test your market. Create your own product labels and packaging or have a design expert make something for you at Fiverr.com.

List your new product at auction to see how many people place bids and how much they offer. See how many people bid more than your minimum acceptable price for the product after taking sourcing and delivery costs, as well as eBay and PayPal selling fees into account. Fulfill the winning bidder’s order and send Second Chance offers to all unsuccessful bidders offering more than your lowest acceptable price.

Do another couple of test runs and calculate how many orders you might receive and how much profit you could make each week. If all bodes well, use profit from initial sales to buy further private label products and repackaging materials.

Private Label Products are very big business and there are several websites dedicated entirely to helping people find Private Label Products and differentiate their end products from anything similar on the market.

Until my free report about Private Label Products appears next week, you might take a peek at the following sites: StoreBrands and The Private Label Manufacturers Association.

This article first appeared on Auction Genie. Read more and comment here