I Sold It on Ebay: cool looking store, subpar internet presence |
Loading ...Near our local Best Buy store I’ve seen this I Sold It on eBay store for awhile:
My thought was wow, what a cool looking store. It seemed like a ok business idea too, if not for that fact that paying strip mall lease prices are a real profit margin killer. And then I started wondering what type of people would stumble in there to let this store act as a proxy, giving them a cut instead of just listing themselves and keeping 100% after fees? People without computers? People who have no desire to sell anything on eBay?
And what about internet advertising for the store? If I was going to have these guys sell for me, wouldn’t one good way to measure their success would be checking their internet presence? Did they have a blog? Did they have good keyword penetration in the engines for the store location? What was their ebay feedback ratio like?
I did a Google search for “isolditonebay” (292 results) and then “I sold it on ebay” (37,900). Hmm, not very promising. To be fair I should have actually walked into the store and spoke to the manager/owner to see how things were going. Instead I think about this place whenever I go to Best Buy and see it in the distance, wondering how they are making the monthly lease payments.
I guess the assumption with these stores is people who are savvy enough to Google keywords for their business wouldn’t bother listing items on eBay themselves? I think if I’m going to pick an online salesperson than step #1 would be picking somebody who actually shows me they know something about the internet (of which search engines are an imperative resource).
The hassle factor
Clearly these I Sold It On eBay stores are preying upon people not wanting to bother listing items on eBay. I can see that thinking considering we’ve spent time listing books where we made like a $1-2USD. Recently, I’m reminded that we had hundreds of books that we ended up just giving away. Thousands of books at one point, but I did list some of the more rare ones and sold them for a decent return on eBay.
But what about these stores? What type of customers are they targeting? Would you offload a bunch of stuff at a store like this and split the money? I don’t think I ever would, but it remains a curious business idea. Ever seen one of these stores in your area? Anybody know more about them?
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It’s actually a massive business. Not this one, per se, but being an Ebay broker. A friend of mine does here in town. Charges 1$ per item, and then 15% if it sells. She does a few hundred a month and off she goes.
The lure? Twofold. First, it “costs” nothing, because people are making money on stuff they wouldn’t have otherwise. Secondly, it cuts into many of the “money saver”, “penny saver”, “stuff trader” markets where people can list objects for free that they want to sell or trade. Instead of people having an audience of a few thousand locally they have the millions on Ebay.
Huge business. Makes perfect sense for someone with no net savvy. Hell, I have net savvy and I’d be happy to dump off boxes of stuff and get a cheque for 250-500$ later. It’s the new garage sale. Just without the tables and haggling.
Comment by Jeremy Wright — April 4, 2006 @ 5:55 pm PST
In “40-Year Old Virgin”, the love interest operated a store called “We Sell Your Stuff On eBay”, where they did the same thing. The inside of the store was just shelves of inventory, and a camera area with a stool and backdrop.
A great scene was where someone came into the store, looked around, picked up something, and said, “I’ll take it”. The woman said, “No, we don’t sell anything here”. And they spent the next minute arguing, where she said it had to be bought on eBay, that he couldn’t just hand her money and walk away, like in normal life.
Comment by Nathan Weinberg — April 4, 2006 @ 6:08 pm PST
Makes sense for people who feel insecure or lazy about:
1. creating and on-line account of any type
2. running an auction
3. collecting payment, especially on-line
4. delivering the goods
Pay someone else to do it and let them sweat the details. I wouldn’t, though.
Comment by Sterling Camden — April 4, 2006 @ 7:42 pm PST
I have a store like this in my neighborhood. I wanted to sell an item and just didn’t have the time to take the photos and such myself. This place took a fee (can’t recall it’s been over a year) in the neighborhood of 10%, + other assorted fees. AND they also passed along the ebay fees to me. All-in-all I sold a $280 item, and only got $90 of it.
Next time… I take the pictures and do it myself.
Comment by Lestat — April 4, 2006 @ 8:22 pm PST
Yes I sow that idea in 40 years old virgin movie. Here in Serbia I would be the first one to do that, so I am really thinking about doing it here. Here payapal is not possible, so if somebody wants to be my partner…
Comment by Marko — April 6, 2006 @ 12:45 pm PST
Ok, In the last month I have sold over 500.00 of stuff on ebay for friends, family, myself, etc. I am very aggressive, if I don’t see anyone watching anything I am trying to sell then I will go look for individuals who have been “out-bidded” on a similar item and offer my item to them. To date I have sold everything I have posted and 10 of these sales where customers that I sought the business from. I myself am a penny pincher so when I post something I always way the value of the item and the cost it may take for me to sell it. My husband recently said that I should open a little shop in our local down town business strip but then I started looking into franchises, especially Isold it, I guess for the security. I guess what I am attempting to do is to get some feedback… If you had the opportunity to have someone service you does the “franchise” name offer you security in choosing them to sell your item or would the fact that my local shop would allow someone to walk in and purchase the item if at the buy it now price be more of a lure? Please let me know any feedback you may have. Thanks!
Comment by Tammy — April 9, 2006 @ 6:48 pm PST
We have many of these stores as well. Even some ‘mobile services’. They come with laptop and camera to your house. Take a picture, create the auction listing right in front of your eyes and get paid when the stuff sales. Many are specialized on different categories like collectibles, children clothes, etc. Great business idea
thomas
Comment by Thomas Haselhorst — May 7, 2006 @ 6:32 am PST
its a good idea: sorry i don’t think the author of this page knows much about eBay or good business marketing to really have a valid grouds for real criticisms. For one thing, I can’t see why having good online advertising would be imperitave for their business given a large portion of their target market i.e. people who don’t have internet, or are uncomforable with it but want to sell unwanted goods and would like a walk in store.
I sold it has over 900 franchise stores the US, canada, Ireland and England. I am fairly certain they have been able to make the lease payments.
Comment by winston — May 10, 2006 @ 2:48 am PST
Winston - appreciate you taking the time to offer your opinion, but I must respectfully disagree with just about everything you typed. Time will tell if these criticisms are valid. I know what lease payments are in that strip mall and they aren’t cheap. Have to move a lot of merchandise on eBay to pay the bills. We’re not even talking employees, insurance, and all the other expenses a brick and mortar business has to endure. I wish them good luck, but if you are seriously suggesting above that online advertising isn’t important to these I Sold It on eBay stores — which includes a good search engine presence in this day and age — then it is you, sir, that doesn’t know anything about “good business marketing.” How did you find this page and this author? Google, perhaps?
I rest my case.
Comment by TDavid — May 10, 2006 @ 9:07 am PST
uh no….. see I’m not in their target market because I actually use the internet regularly and know how to sell on ebay (and search on google for that matter).
dude, their business model is not that hard to understand. Search engine presence might be useful but isnt at the core of what they are trying to promote i.e. an offline access to the ebay marketplace for sellers. so try explaining why search engine presence is important for this type of business, instead of just stating it like its the holy grail of marketing.
you seem to also like listing costs as endless drains on business: lease, employees, insurance…. yeah that’s about it. okay, maybe the power bill and internet access - what a whopper!
All a store basically needs is a couple dudes that are good at ebay and know how to use a digital camera - no special skills or college degrees, you could pay them about $10 an hour. They don’t need stock, delviery trucks, warehouses, call centres, or a lot of equipment besides an internet connected computer.
By the way, are you like 16 years old?
Love,
Winston.
Comment by winston — May 10, 2006 @ 8:49 pm PST
Winston - and here I thought I’d rested my case? Ok, one more post for making me a teenager again. I won’t take the bait again though unless you have a really intelligent reply and it contains no insults.
Now relax, you are coming across like you actually own one of these I Sold It On eBay stores or some family member does. I’m a bit perplexed by your tenacity here, but whatever, some people will flame over silly shit.
If you are intimately connected to these I Sold It On eBay stores then maybe you’d know what a triple net lease entails, yes? Ahh, the maintenance and upkeep costs and that dirty word: taxes. What about the phones? Or do those two dudes you’d pay $10/hour never use the phone? Sure, they could — and should — use VoIP and that’s a minor expense but are they? If they are, then they’ll need at least a broadband connection because dialup won’t cut it for VoIP. Do you think they also shouldn’t be listed in the phone book either? Our phone ads for our brick and mortar business aren’t cheap and we’re in the same county.
And you honestly believe a $10/hour employee is going to write good quality eBay listings? Should we even go there? I suppose next you’ll argue that it takes no skill whatsoever to write a good quality eBay listing? Talk to a couple power sellers someday and get back to me. They have systems to be able to crank out listings fast but is it dialed down so a nearly minimum wage employee could — and would — do it? Are there any bonuses/incentives for these $10/hour dudes for higher yielding auctions? Or are you going to post back and tell me that the auction listing quality is unrelated to the price it will ultimately yield? Try that on somebody else that hasn’t done their fair share of buying/selling on eBay.
As for digital camera? What kind of digital camera? If these guys are pros they aren’t using a camera that came in a Cracker Jack box, they are buying good equipment (although they might have gotten a good deal on eBay).
Now what if those two dudes go to people’s homes to pick up items as Thomas points out in comment#7 above? I’m guessing they’ll need some sort of vehicle for that, yes/no? Who’s going to pay for that? Gas isn’t too cheap these days. And personal insurance policies will not cover business use without a special endorsement. So if these dudes are using personal vehicles for business use they are leaving the business exposed.
Sure, the business expense for a guy running this operation out of his basement or garage with no mobile service isn’t nearly that much — which brings us back to the whole point of my original post. Once you get a location in an over-priced strip mall, the rules of the game change and I was simply questioning how much inventory these folks had to move in order to turn a profit? I don’t know the answer, but it definitely would depend on the average cost of the items they are moving, their take and expenses and time involved in acquiring the item (are the people just bringing it in, are they going to pick it up?), creating the listing, ending the auction, finalizing payment, sending the item and following up for feedback.
Of course maybe the prices in Australia strip malls aren’t like they are in the US, Winston, so maybe you think I’m somehow overstating figures in my own local area?
Comment by TDavid — May 10, 2006 @ 11:04 pm PST
buddy you can question all you like, no matter what i say you will turn a simple business expense into the most outrageous cost in the world that no one should be able to afford.
These stores run a very trim and efficient business model compared to other businesses that rent in the same area.
Just sounds like you think your an expert on running a business and reckon you are saying something profound. Sorry for insults but if these stores seriously make you go hmmm… (which is really lame by the way) then you should try thinking a little harder.
Comment by winston — May 10, 2006 @ 11:29 pm PST
Hey Winston,
I live in the most overpriced commericial market in America. I sold it on ebay has opened and closed in almost every location in the Los Angeles metro area. You really think a guy with half a brain would put money into purchasing a franchise when the odds of making money are slim to none. The entire business model is flawed. No one in their right mind would bring items knowing what they eventually sell for on ebay. In almost every situation the consumer is better off selling it themselves on craigslist. The other aspect most franchise owners forget to consider is the amount of customer service required to sell the most useless items. Shipping issues are the biggest obstacles for obtaining a satisfactory effort versus reward return on your investment. To all of you considering putting money into one of these scams. Forge it about it. You’re better off investing your money or throwing it over a bridge. Take care everyone.
Comment by andre — May 14, 2006 @ 11:28 pm PST
[…] This brings me back to the I Sold it on eBay post where I wondered how these stores can make it with strip mall lease prices? Sidenote: see me getting flamed in the comments for not knowing anything about how business works. […]
Pingback by Make You Go Hmm: » Strip mall and housing developments moving the world backwards? — May 25, 2006 @ 8:13 am PST
I am in the process of buying an iSold It store. It has been open for 15 months, and made $240,000 in its first year. The current owner, who pays a manager to run his store and doesn’t have much involvement, made (take home–after taxes, lease, employees and EVERYTHING has been paid) $87,000 for himself. Not bad. And the area the store is in is growing. Just some information for you guys.
Comment by Katie — June 15, 2006 @ 5:28 pm PST
Very interesting, especially comment #15 re: financial stats, assuming truth & sincerity.
I never heard of these stores until 2 days ago when my son who lives in a north suburb of Dallas said his girlfriend, a successful and experienced e-bay seller, uses the stores to sell overages of merchandise which she does not have time to market herself. My understanding is that she pays about 30% in fees and charges. I was interested in selling on e-bay but had not done any homework on the methodology yet and thought utilizing the isolditonebay store could be a quick way to earn some money while learning to market on e-bay myself. But, the closest store open to me at this time is over an hour away and I would not sell anything through the brick and mortar store if their fees and charges are not “up front” and reasonable. Comment #4 states they had to pay 2/3 of the selling price in fees. I would call that excessive.
A suggestion for checking complaints and info on this franchise would be to check them out through the BBB online. I have found very helpful and useful info using this method. The company does not need to be a BBB member to have complaints listed on the BBB website.
Good luck in obtaining the info.
Comment by Lee — July 4, 2006 @ 1:37 am PST
Actually, FYI, there IS an internet presence: www.i-soldit.com
(Looks like the co. was unable to acquire the rights to the domain name containing the full co. name.) (I was searching for it myself on behalf of an elderly relative who is a long way away from being able to sell their own items - and I don’t have the time to! - when I came across this discussion.)
Comment by May-Ellen — August 4, 2006 @ 11:44 am PST
The crux of this is the financial model…comment #15 projects one example. In my own analysis, based upon inputs from franchise operators, I examined what is required to turn the typical initial $150,000 investment (including startup expenses until break-even is reached) into a $300,000 business sale price within a 3 to 4 year period. The conclusion was that the inventory turnover rate through the store would need to be approximately one $50 item sold every 10 minutes!!! I don’t believe that anybody is doing anywhere near this.
This doesn’t mean that the owner-manager cannot make a reasonably good living. But if you look at this as a high risk investment with the objective of returning 20% per annum on the investment, it is really a stretch to imagine it ever happening. If anybody would like the summary of my analysis, just drop me an email.
Bill
Comment by Bill — August 19, 2006 @ 7:06 pm PST
Bill in comment 18, I would like the summary of your analysis. Please email to me.
Comment by Neil — August 23, 2006 @ 3:13 am PST
bill,
In regards to #18 please send me your analysis
Thanks
Comment by christa — August 27, 2006 @ 6:20 pm PST
Bill in comment 18, I would like the summary of your analysis. Please email to me.
Comment by Mitch — September 13, 2006 @ 12:20 pm PST
these stores also make money on shipping. these stores get discounted rates on fedex and then charge the customer normal (higher) charge.
Comment by Jared — September 18, 2006 @ 4:55 pm PST
Hi Bill-
I would also be much obliged to read your financial calculations on the soldit-on-ebay concept. Thanks!
Comment by neal — September 27, 2006 @ 1:31 am PST
Hi Bill
I’m considering an “I Sold It” franchise so would much appreciate it if you could send me your analysis. Many thanks. Early days yet, but anybody have any comments on such franchises in the UK?
Comment by Ian — November 1, 2006 @ 9:42 am PST
Hi Bill,
Thanks for comment #18. I would like a copy of your analysis. I Sold It is fairly new to the UK and caution is required. Does anyone have any further info on the success rate (re comment #13). Horror stories welcome, will make a good balanced against the franchise sales pitch!
Comment by Vernon — November 8, 2006 @ 4:06 pm PST
Bill–I have been working at an I-Sold it franchise for close to a year. It has become very successful and am looking into opening my own franchise. Please send me a summary of your analysis. Thanks.
Comment by Scott — November 21, 2006 @ 11:14 pm PST
Hi Bill - I’m also looking at setting up an i-soldit franchise in a different country. Would really appreciate if you could send me your full analysis to compare against the franchise sales pitch.
Thanks so much in anticipation
Comment by Nadia — December 13, 2006 @ 7:14 am PST
Bill, Please also send through your analysis to me. ISOLDIT are now operating in Australia and I woul dlike to see how your numbers stack up with theirs (and mine)
Thanks
Comment by Aaron — January 4, 2007 @ 9:57 pm PST
Bill- if you can send a copy of your analysis that would be great.
As a general comment- the idea seems sound on the surface- you are just acting as a pipeline to the biggest market in the world. The supply side is a non-issue, how long have people been taking stuff to pawnbrokers, swap meets, markets or advertising in classified newspaper? This is just another channel to market, there’s plenty of inventory and will continue to be… the only thing that will impact this side is the penetration of technology and people becoming more tech savvy over time and not needing these stores. Having said all that the costs vs return scenario is still a concern.
Comment by Rob — January 16, 2007 @ 2:04 am PST
Thanks for your work mentioned in #18. Please include me for a copy of your analysis.
Thanks, Mike
Comment by Mike — January 16, 2007 @ 8:23 pm PST
TDavid - your Google search yielded so few results because both times you grouped the words incorrectly - the correct way to search is to group like this: iSoldIt on eBay (441,000 results - quite higher than 37,000). Also, a large Internet presence isn’t important for successful selling on eBay - the right products and the presentation of the products is what counts, and - like you said - the feedback rating of the individual franchise. iSoldIt isn’t ‘preying’ on anybody. The people that use the service are usually internet users who don’t want to be bothered with all the time consuming aspects of it… especially the packing and shipping. Also, many parents just don’t have the time, so it’s a nice service. Many folks I’ve spoken with love us and think it’s a fantastic service.
Comment by Johnny — January 18, 2007 @ 11:39 am PST
I used to own an iSOLD It store. Being in a high retail location, the rent costs eventually eat up any potential profit. And the amount of labor and other expense involved in selling other people’s used stuff is very high. I think that this concept is profitable, but only if the rent is kept down. I think you could be much more profitable by having a warehouse and a truck. With public retail, you have to sift through a lot of crap to find sellable items. I wish I could have spent my rent money on advertising. Because I would have had more to show and if money is tight, you can always cut back on advertising; a little harder to do that with rent.
No offense Katie, but I seriously doubt the owner you are buying from was making $87,000 a year on $240K in sales. That is only $20K a month in sales, which is maybe $6k in profit. And based on the CORP business model it is EASY to have $10K a month in expenses.
And I know that the top 10 iSOLD It stores are only $50K+ a month in sales. How do you think the other 150+ whatever stores are doing? Much worse.
Comment by Hunter — January 19, 2007 @ 6:32 pm PST
Bill,
Please send me a copy of your analysis.
Comment by John — January 23, 2007 @ 10:57 am PST
Hunter,
How long did you own the store? What part of the country was it in? Is the store still in business?
Comment by John — January 23, 2007 @ 10:58 am PST
Bill, I’d like a copy of your analysis. I have requested the franchise info on a store. According to it, there’s about 80k in startup plus your rent, etc. The interesting thing about this is that many people’s assumptions here are looking at this store as a very reactive business model - waiting for others to walk into the store. However, there are many places where overstock, refurbs, etc can be purchased cheaply. Combining these sources or other novel ideas are options here. These could be things like approaching your local church or school to partner in fundraising effort where maybe the fees are reduced. Things like this allow the organization to make money on donated items, but they would get broader exposure than a 1-2 day rummage sale. What about local stores with overstock or little ability to market their items online? They might benefit from some ebay sales where they could include a catalog/business card.
I would have to agree that waiting for walk-ins wouldn’t yield a successful business, but that if used as a front for larger efforts, those activities might act as a supplement. No business or franchise is successful just by putting a sign above the door and waiting for customers. Rent, etc would eat that type of lack of effort for any business. It takes aggressive perseverence and looking into expanded possibilities for success.
At least these stores forgo many issues that standard businesses face - lots of up-front money in inventory. Cash tracking (according to iSolditonebay there’s no cash exchanged between the store and seller - their processing system handles sending all the checks to both parties.), etc. Any type of business faces the cost of fixtures and the like - think about that neighborhood creamy-whip selling $1.50 ice cream cones from a $15-20,000 machine. I hardly think a $600-1000 camera, a tripod, any maybe a lighting setup is unreasonable in terms of startup costs.
Comment by Brian — January 23, 2007 @ 1:47 pm PST
While I agree with Brian’s statements about not waiting for people to come in the door; the fact of the matter is, you don’t need to purchase a franchise (iSOLD It) that requires that the stores be positioned in high-traffic retail locations (expensive) if you are going after non-consumer customers. Much to the contrary, I know that many current owners would love to focus on the more profitable business clients and iSOLD It corp does not dissuade you from doing so. However, there is only so many hours in a week and you still have to deal with all of the stuff that is coming in from the street.
Comment by Hunter — January 23, 2007 @ 5:26 pm PST
My store was located in a large midwestern town in the highest average annual household income area of the city ($100K+ according to city records).
No, it is not still in business. I closed it in July 2006 and sold the assets to another franchisee, whose intention was to open store#2. As a side note, this has not yet occurred.
Comment by Hunter — January 23, 2007 @ 5:32 pm PST
I used an I-Sold-it store to sell some quality pottery. Didn’t want to bother with packing & shipping. Took it to the store on November 17, 2006, they didn’t list it until January 2007. They sold most of it within 5 days. I still have not been paid, although they have shipped it to the buyer. NOT a good experience. I’ll never do that again. I’ve heard other horror stories too.
Comment by Jeanne Bennett — February 12, 2007 @ 5:38 am PST
I used an I-Sold-store and am still waiting to get paid. It two weeks to post the item, 5 days to sell it and over 6 weeks to get paid. Never again.
Comment by Johnc — February 15, 2007 @ 12:07 pm PST
Interesting dialogue. I own an ISI store. I agree with the problem of high rent in a strip mall, so I purchased the building my store is in. I rent to myself. I searched for a high traffic area. Business 101 - location, location, location.
Like any other start-up company, there is going to be a learning curve that needs to be built into your business plan. How much ebay experience do you have? Who is going to manage the store? What’s your break even? How do you supplement the walk-in business?
So many people get into a franchise for the wrong reason. They think it’s a get rich quick scenario. If that’s what you think, buy lottery tickets instead. Every successful franchise takes a lot of work.
The bottom line? Do your homework. Know what you are getting into. Make sure you have the capital to start a business. And most importantly, understand this type of business is new, it’s going to change and change and change as the general population becomes auction savvy.
Want to try and understand where it’s going? Buy the book “Future Shop” by Daniel Nissanhoff.
Thinking the drop-shop stores will fail because people can do it themselves reminds me of some other businesses that I’m sure people thought would fail initially. It goes something like this: “Let’s start a bunch of coffeee shops and sell coffee for $3.00 when the customers can make it themselves for 10 cents! And, oh, let’s put one on every other street corner.” Or, maybe “Let’s start a hamburger chain and sell burgers that don’t taste as good as the ones you make at home. We’ll use the cheapest ingredients and sell billions of them.”
So many comments about people doing it themselves on ebay. Well, of course they can. But they also can make better burgers and cheaper coffee, can’t they? BUT THEY DON’T! This is a world of convenience. And the drop-shops are another method of convenience. They will survive. You can take that to the bank.
Comment by Bob P — February 16, 2007 @ 12:06 am PST
Bob P - While I agree that the concept of eBay drop store is no different than any other convenience service, if you can’t make a reasonable profit with an iSOLD It franchise, it doesn’t matter how convenient it is. Buying the building that your store is located in doesn’t eliminate the problem of rent. If the store is not making enough money to cover rent, then it is still you as the landlord that loses. And if the store is making enough to cover expenses, but not enough to earn a decent profit, then it is you as the store owner that loses.
I actually disagree with the “location, location, location” argument. While owning my store, I found that people are willing to seek this concept out. While being in a great location might help to snag the occasional passerby and educate them about the store, so would advertising. Taking things to an eBay drop-off is a premeditated act; you don’t just happen to be driving by the store with a carload of stuff. It isn’t the same as, “I’m hungry, there’s a McDonald’s.” I am not saying be impossible to find, but a little off the beaten path would save quite a bit in rent.
I would be curious how long your store has been open (under your ownership), what general geographic area it is located in, and if you are losing money, making money, or just breaking even.
Comment by Hunter — February 17, 2007 @ 6:05 pm PST
As a franchisor of ebay drop-off stores, we at eAuction Depot are finding that our business model of brick and mortar locations is one of the best investments in the country. You have to remember, that only 65% of your business will come from walk-in customers. Our franchisees are setting up fundraisers for non-profits, schools and churches and are also liquidating overstock or additional inventory for businesses in their communities. We believe that a retail presence allows for immediate validity when dealing with non-profits, businesses, and individuals who have extremely valuable items that they want to liquidate. There are many benefits to owning an ebay drop-off store franchise. Yes, you absorb the expense of a retail location, employees,utilities, and royalties, but your return is far greater than the expense. Visibility is of the essenence and people are much more likely to bring their valuables to a store front with a national brand than to someones garage. Also, an eAuction Depot franchise offers on-going support and incredible software that allows you to list items far more efficiently than an individual who is selling on ebay from home. Ultimately, an individual has to determine what their time is worth in dollars and cents to decide whether they would bring an item to an ebay drop-off store or list it themself on ebay.
I have known how to change oil in my car for over 20 years, but have only done it once. Also, my wife makes a much better hamburger than McDonalds, but we have been known to use the drive through after a busy day. We live in a culture that values convenience. This is the main reason that an eAuction Depot franchise is such a great investment.
Joseph Testino
President
eAuction Depot
Comment by Joseph Testino — February 18, 2007 @ 12:14 pm PST
Reference post #18. yes Bill, I would also like a copy of your analysis. I’m considering an I Sold It franchise.
Comment by John — February 19, 2007 @ 7:39 pm PST
John,
I would encourage you to look closely at an eAuction Depot franchise prior to moving forward with I Sold It. Your total up-front investment will be about $50,000 less. Also, we have never had a store close and are continually having franchisees purchase their second stores.
Best Wishes,
Joseph Testino
President
Comment by Joseph Testino — February 20, 2007 @ 6:02 am PST
Hi Hunter,
Please see some very good comments by Joe Testino, although his comments are understandably a bit slanted toward his own company.
The location of my iSold-it store is on a road that leads directly to the interstate and also connects two main streets in the Philadelphia area. Yes, people don’t usually drive by with stuff to sell in their cars, but they do drive by every day and those people are coming in by the droves. They don’t have to ‘find’ it. And they also, by word of mouth, have been spreading the news. We haven’t advertised yet because we are barely keeping up with the business we are getting now.
Location doesn’t always mean high price. I searched for over a year for this location and I’m currently in search for my second ISI store location.(Got any leads for me?) The mortgage for the entire building (store and 2 - 2 bedroom apartments) is equal to the rent I would be paying in a strip mall. The revenue from the store and the apartments far exceeds the cost. (I am also a real estate investor, but that’s another story - read ‘RichDad, PoorDad’ by Robert Kyosaki.)We have only been open for a short time, so yearly earnings are a bit early to report on. However, we are covering all expenses and turning a profit.(Yes, the business and building it’s in are making a profit.)
I think more people go to McDonald’s in a premeditated way than just thinking “I’m hungry” and happen to drive by one. Just as they go to Starbucks and every other convenience establishment. I agree with Joe that people just don’t want to do the work themselves. Is selling on Ebay easy to do yourself? Kind of. It is time consuming? Definitely. And that’s the key. If you save people time they are willing to pay a premium. I personally have bought/sold stuff on ebay since it started and find the store a much better way to do so. Like Joe’s eauction, ISI and the others, drop-shops have all the back-end hardware and software, training, etc. to get someone started. But they don’t do the work. You do! So, regarding stores closing, I have seen both McDonalds and Starbuck stores close. A business is dependent on how it’s run - not just the name on the building.
I again strongly suggest to anyone thinking of getting into this business, whether it’s ISI or Joe’s or any of the others out there to read “FUTURE SHOP” by Daniel Nissanhoff. Very interesting look into the future of a society that is developing an auction mentality by the advent of Ebay and like online businesses. Fascinating!
Best,
Bob
Comment by Bob — February 20, 2007 @ 9:26 am PST
Bob,
You seem to clearly understand that your business\’ success is dependent upon your ability to generate business from the many revenue streams that are available. It is very simple—if a franchisee expects to succeed on walk-in business alone, they will fail. It is imperative to network in your community and make people aware of the services that your store can provide. We at eAuction Depot offer a service where we will go to a client\’s home or business and pick up the items. Remember, it is not as much of a priority for the customer to bring you their valuables, as it is for you to get these items to your store. It is important to make this service very accessible to both individuals and businesses.
It seems like you are on the right track. I wish you all the best with your current Isold It store and for those you open in the future.
Comment by Joseph Testino — February 20, 2007 @ 10:48 am PST
Bob,
I am glad to hear that things are going well for you and that your store is already seeing profitability. Based on your eBay sales, it looks like your have been open for about 2 months. I wish you well and I will track your store.
I do not want people to get the wrong idea, I am not saying that selling stuff for people on eBay can\’t be profitable. But as a business owner you must be VERY aware of the costs that you are involving yourself with. And, again, you must decide if what a franchise brings to the table is worth the cost. Obtaining sales outside of walk-in can be done by anyone. Buying items to resell can be done by anyone. A franchises main draw is the off the street consumer, which for the business is the most labor intensive.
For those who are considering buying a franchise, I suggest that you do a lot of research. One nice tool that will help you to determine the gross sales of ANY seller on eBay is terapeak.com. You will need to sign up for the Advantage plan which will cost $24.95 per month. It is well worth the cost. Using terapeak, you can plug in a seller\’s eBay ID and get their sales for the past 90 days in 30 day increments. I suggest that you run a few iSOLD It ids through and they are all on their website under locations. ebay id format is isoldit.state# example: isoldit.pa0237
Good luck to all
Comment by Hunter — February 20, 2007 @ 8:56 pm PST
Joseph from eAuction info - please knock off the extra signature. You do not need to add an extra signature & link in every post. You already get one link in every post the rest is unnecessary and not welcomed. You would think when that was edited out of your first post you would have gotten the subtle hint.
Comment by TDavid — February 20, 2007 @ 9:35 pm PST
Hunter makes the best point. The rent is the profit killer. I am starting out on my own using my 2 car garage and my two extra bedrooms. Say, could not that be tax deductible? That is another good point, an accountant. An accountant will really open ones eyes to the pitfalls of buying a franchise like iSoldit.
Advertising is a must so I know where I will put ads in my 25 mile business target circle.
Comment by Tom — February 26, 2007 @ 6:40 pm PST
Word on the street is that the iSOLD It corporate office laid off most of it’s staff, sold the only company owned store, and the office is up for sublease. This info is from an eBay “community” posting and amitheonlyone.org. Granted, amitheonlyone.org would more than love to see iSOLD It corp collapse, I don’t feel they would ever sink to manufacturing information.
I think that I hear the bell beginning to toll.
Comment by Hunter — March 25, 2007 @ 8:33 pm PST
Re #50 - has anyone anything to add to this? I’m looking closely at these franchises in Australia and would welcome up todate info.
Regards, Rick.
Comment by Rick — April 1, 2007 @ 11:59 pm PST
Rick
Fair warning stay away from ISI
You would regret buying into this franchise. You would be better off taking 1/3 of the money you would invest in to this franchise and investing into your own inventory such as refurbished or discontinued items renting a storage unit to store the stuff and list your own items from your own home. there is ore reliable business management software available for a fraction of the cost.
ISI wants you to invest in a high traffic area such as a strip mall. The rent for these place is very expensive. When eBay sales are down, like in summer you still have all of the overhead costs and you will put more money out of your pocket to pay these expenses. ISI is crumbling and if you franchise you could be stuck fulfilling your rental agreement for the remaining years of your lease and after the novelty wears off in your area you will have to find your own inventory anyhow and pay royalties on it and overhead expenses in a commercial area why bother buying a franchise and pay them the royalties on your own inventory?
ISI will not provide the support or the Marketing they promise. Your marketing dollars will go to help them market selling new franchises if and when they resume selling them. They do not have the staff to support any new stores nor existing stores.
They sold so many franchises so fast they couldn’t honor their commitments and their solution is for you to continue to work at your store you are at least bringing some money in and work the store yourself… but remember they will still collect royalties due them from every sale. You will have to borrow, take out more loans use credit cards hoping to stay ahead of the game to keep up with bills and finally exhaust yourself.By working the store yourself and even with family members how long do you think you will survive without sales exceeding your overhead costs and living expenses?
A majority of the people that will bring items to you to list will first bring you junk that won’t sell well and the time you spend educating those people is not worth much. Then a lot of people will come and waste your time asking you How it works what sells what percentage do you take etc. and never return anyhow. Each person that wastes your valuable time you could have listed one - three items from your own inventory. I would rather spend money on my own items that will sell well in the first place at a low cost and resell them for 30% or more than I spent on the items then have to deal with garbage people bring in and then waste my time with them and if you do list a piece of garbage to be nice to them and it only sells for 20 buck or more you have 70 percent of the time they will still complain it didn’t sell high enough and act like it was your fault. You can still list for other people but without the high overhead and royalties you can afford to be more selective too as far as who’s items you list and what items you list. I would rather list 10 items for people that sell for 100.00 or more than 100 items that sell for 9.99.
Just advice from someone who has had much experience with ISI and is truly sorry he did.
Comment by Peter — April 5, 2007 @ 4:01 pm PST
Rick,
Please be advised that there are two sides to every story. As an ebay drop-off store franchisor, we are always saddended to hear stories of businesses in this industry that have failed. Unfortunately, this happens in every industry, not just the ebay drop-off store industry. The reality is that franchisees that believe they can simply pull the open sign and sit behind the counter and wait on business WILL FAIL!! At eAuction Depot, we have NEVER had a store close and are opening new franchise stores every week.
It is unfortunate to see so many disgruntled ISold It franchisees, but they ultimately were the ones who failed to research the company thoroughly and made the ulitmate decision to join the ISold It team. When researching investment opportunities, it is important to understand that BIGGER does not necessarily mean BETTER. At eAuction Depot, we choose our franchisees very carefully. We do not accept a check from just anyone. It is important for there to be a good fit between franchisor and franchisee.
For those looking to get involved in this great industry, please take a close look at eAuction Depot. We are, by far, the most desired ebay drop-off store franchisor in this great industry.
Comment by Joseph Testino — April 6, 2007 @ 6:37 am PST
Joe;
We track close to 500 franchise stores, yours included, and 1 (yes One store, not one franchise) is making money. Most stores that say they are breaking even, have not included paying the owner, or paying back the startup investment (which includes SBA loans). You have not closed any stores because you are too new too the game, and your stores are NOT doing well, as evidenced by your ebay numbers. As for ISoldit, their UK franchisor went belly up a few days ago stranding all the new franchisees. Their US Corp office is up for lease and their company store has been sold, and over 60 stores have closed, with more closing each week. They & Quikdrop are in heavy mediation and litigation, which reaffirms that there is a problem! These franchisees are and were not poor business people, or lazy people, they did their homework, what was available at the time, which was VERY little. There is a plethera of data NOW that shows THE CONCEPT DOES NOT WORK, which makes me wonder WHY you and others are still selling a concept knowing it doesn\’t work.
Check out our website amitheonlyone.org for more information, much of it has been submitted to us from over 100 franchisees. And we have better than 20,000 pages of documentation supporting what is said. Read the suicide note from quizno\’s, we get letters like that every week, from zees in drop off stores, NONE are making the grade. So tread carefully my friend, because the whole thing is about to implode!
Comment by amitheonly one — April 9, 2007 @ 8:12 am PST
I am very aware of your website and the overwhelming resentment that you carry towards your former franchisor, ISI. It is unfortunate that you have chosen to place all ebay drop-off store franchisors in the same category. Fortunately, eAuction Depot does not operate like the others in this great industry. We offer extensive training and on-going support to each and every franchisee throughout the country, thus providing them with every opportunity in the world to succeed. Please keep in mind, that no franchisor can ever guarantee the success or failure of a franchisee.
Your evaluation of over 500 ebay drop-off stores in the country is not validated and is not accurate. If you would let go of your anger and begin researching this industry with an open mind, you would find that many in this industry are using alternative websites to sell merchandise that is either purchased or brought in to their stores. In conclusion, your assumption that ebay sales alone represent a stores success or failure is 100% inaccurate.
I have often found that I have a choice on a daily basis. I can either look at the glass half-full or look at the class half-empty. Unfortuantely, you have chosen to seek out the negative in this wonderful industry.
I wish you all of the best in your future ventures.
Sincerely,
Joseph Testino
Comment by Joseph Testino — April 10, 2007 @ 6:22 pm PST
[…] A little over a year ago I wrote a post titled I Sold It on Ebay: cool looking store, subpar internet presence that has since generated 50+ comments ranging from I didn’t know what I was talking about criticizing the business model to confirmation from others that the high lease contracts do hurt the business model to even more bizarre claims like almost none of the franchises are making money. There was even this other guy from a rival service saying how his service wasn’t having the same problems. Clearly this post struck a nerve. […]
Pingback by Local I Sold it On Ebay store vacates, business model in pricey strip mall still suspect » Make You Go Hmm — May 7, 2007 @ 3:58 pm PST
Joe, you tout your software as your best feature, yet I hear that you recently discarded it for the one we reccommend. Even with it, your stores still struggle. We have been in your stores, and they have more problems than the obvious ones, and will most likely have the same fate as Auction drop, Numarkets, ISoldit, Quikdrop, and Snappy! Your method is NO different than those who are failing. We have done extensive research and can back our statements, and we are NOT trying to sell people something. Instead we have helped many store owners keep from bankruptcy, divorce, and suicide, while you and others get rich selling them an unproven concept! Do not mistake our disgust for anger, for reality is not always positive or pleasant, and denial will certainly not help your stores!
Comment by amitheonly one — May 17, 2007 @ 7:33 pm PST
Wow! This is a very interesting discussion! As a current owner of an i-Sold It store, I too have felt the brunt of the status quo business model; high rent, high labor costs, low margins… but, we have also revisited our business model, and accommodated where needed… We are on track to decrease labor and increase margins, but not without much effort… But, isn’t that the way it is in every business? ISI and other drop shops are independent owners of franchises… While it is expected that we receive support and training, ultimately, it is OUR business to manage to success or failure… When I opened my store, I was in a similar situation as many, not having the “whole picture” available regarding the true operations of a drop shop… While I would gladly accept more business (higher dollar value, of course), we are managing through managing… I too have visited the “amitheonly one” website, and have read numerous articles… I am an open minded person, but having come from years of business, I also understand that we are still in a fledgling business, that has ample room for growth. Yes, there are numerous people selling for themselves on eBay, as well as other forums, but most franchise companies also have like competition in their immediate vicinities… Also, our Nation’s trend moves more toward convenience than “do it yourself”, and I think over time we will see the same results in our business. It’s quite easy to purchase on eBay, but not as easy to sell… We have numerous customers that have accounts and have sold on eBay before, but prefer the convenience to dropping-off. Walk-in traffic is not going to get you there… it’s only one leg of a multi-leg stool… This business has lots of room for creativity and support! Perhaps I “am the only one” that thinks this… None-the-less, even were I the only one, it is MY business that I am running… Should i-Sold It fold, flee & fail, it still doesn’t mean that drop shops have no positive future. Blind ambition and Optimism can be two different things… Will one store set you for life? Not at this point, but it can certainly benefit as a numbers game… It’s all in your business acumen and abilities… I’m greatly saddened for the franchisees in this industry that have lost their investments, homes, and more… but I can present more failed franchisees from other more well known and successfully perceived franchise companies… We, as business entrepreneurs are to blame if we failed to investigate all aspects of a business prior to entering into an agreement. I have also met many store owners that were very naive about entering this business… Unfortunately, they are reaping what they sowed; or better yet, lack of sowing has caused a lack of reaping… Knowledge is power… Personally, I wish the zealous “amitheonly one” group would direct as much energy in trying to help this business succeed as they do in trying to find more misery… Imagine where we could all be if that were the case… I will continue to read posts on their site, as I can glean from comments made, but only in as much as it helps me to continue to find a way to help my own business.
Comment by Drop Shop Advocate... — May 23, 2007 @ 3:00 pm PST
I managed one of these crappy stores in California. The customers are mostly old people that think thier garbage is worth grips of money or low-income oakies that bring truckloads of garbage and yard sale rejects and expected us to sell it all. The profit margin was total shit as well, with new stores closing every day around the U.S. and corporate announcing that they are selling no more franchises. And, I can assure you the lease payments are only being made because the owner has another full time job, but is losing his ass with this going nowhere fast business. I say good riddance.
Comment by Jared Mcanally — July 7, 2007 @ 6:54 am PST
Great Site! Just wanted to post that 2 of these I-Sold-It stores closed near me in Washington State. I liked them because I got a few good deals and then only had to pay $5 to pick the item up in person. However, the stores always looked in shambles and the staff wasn’t all that motivated when I came to pick up my item I won. And it always appeared that there was a high turn over rate as I never dealt with the same person twice. And it’s true that these stores seem to flock to Best Buy locations. The two that closed where in the same strip mall as a Best Buy store. Right now according to the I-Sold-It site there are only 2 open locations in Washington State (originally it was 5), with what looks like 10 more “coming soon”. We’ll see if that actually happens though.
Comment by Joe — July 11, 2007 @ 2:10 pm PST
The isoldit stores have completely changed their concept once again, leaving the less than 150 stores that are open to be the experimental guinea pigs. The 900 reported stores were many additional territory sales of already closed franchisees which would never open. Their stores, as well as the other franchise stores, are all losing money. Check the numbers yourself!
Anyone getting into these franchises now have NOT done their homework. The numbers of closings in 2007 alone show the unstability. As for Am I The Only One’s energy, it is well spent helping MANY of these same franchisees who posted a month ago on how wonderful it all is and are now closing. When the blinders come off, we are the only ones left to help-the franchisors sure won’t!
Comment by AmITheOnlyOne — July 19, 2007 @ 7:10 am PST
Like in any other business there are crooks in I-soldIt too.
From my personal experience I can not recomment this stores.
I went to I-soldIt # 13 here in Newport Beach and dropped some items for auction.
Items got listed and where auctioned off, received e-mail stating the fact that where sold and paid for.
Will be shipped out shortly and I will receive my check. I went to Europe and got back, called the store,
no answer, Voice box was full. Went to the store, Store had closed, note on the door saying: if you have any outstanding business please call. Nobody ever answered. Called other ISoldit stores to find out any information, got the number from a Area Director, nobody answered ever.
I lost over $ 500.00 in my share.
I call this fraud.
Comment by Adrian Davidson — September 23, 2007 @ 6:33 am PST
Regarding to posting number 62 can anybody help, who can I contact?
I could use the money. Who could I contact at IsoldIt?
Comment by Adrian Davidson — September 23, 2007 @ 6:36 am PST
Adrian,
Ken Sully’s (CEO) phone number is 858-436-2850 and his fax is 858-436-2859.
His email: Ken@isolditcorp.com
Rick Forry (CFO) can possibly also help - his number is 858-436-2860.
If all else fails call iSoldIt’s main number 858-436-2800, ask the name of the Area Manager for where you left the items. Leave him/her messages. I would not give up until you get your items back. Good luck.
Comment by Bob — September 25, 2007 @ 2:57 pm PST
… or get compensation for the items.
Comment by Bob — September 25, 2007 @ 2:58 pm PST
Yes very interesting discussion. I have also heard of a new dotcom company called zippi networks, zippi.com that offers a service to pick up your items and sell them. That way the owners of franchises (I’m guessing) don’t have to pay rent for a storefront, instead they can operate from home. This is in many ways seems more convenient.
I have a ton of new high end shoes to get rid of from a movie set that I worked on and am pretty sure I don’t want to sell them myself online. I have an ebay account, but the effort it takes me to sell online is like squeezing juice from a stone. I have a day job, a nightschool, and a ton of stuff to get rid of!
I’ll be trying zippi and report back (if anyone is interested).
Comment by CT — November 14, 2007 @ 11:03 am PST
CT~
What happened with zippy.com? Did you sell all those shoes?
Lauren
Comment by Lauren — February 3, 2008 @ 11:59 am PST
I called Zippi and they took all my contact information. A representative was supposed to call or email me within 24 hours and they never did! I decided to just go ahead and sell the shoes on ebay on my own. It wasn’t too much of a hassle and I did it slowly over a month.
I haven’t heard about zippi since - maybe they’re still getting off their feet. Wobbly I’d say.
Comment by CT — February 4, 2008 @ 12:00 am PST
Very interesting discussion here that I found through a Google search for iSoldit stores.
I am the store manager at a registered eBay drop-off location. However instead of being a franchise store, we are an independently owned and operated business located in Chattanooga, TN (metro pop. 175,000). Not a very big market, but we have been in business for a little over 3 years, but are only at a barely break-even point. We did turn a slight profit the last 3 months of 2007. This is all from “turning on the Open sign and waiting for people to walk through our door”. We’ve done very little advertising, save for a once a month coupon in the local paper. All things considered, we have done okay being that we’ve survived solely on the backs of walk-in customers. This year we are going to be exploring more options to brining business into our store, most of which have been discussed here, such as pickups and partnering with local businesses to liquidate excess inventory, etc.
At this point, the only real competition we have here in Chattanooga is a Snappy Auctions franchise on the other side of town. We have watched numerous other stores close in the past 2 years, including the infamous numarkets franchises in our area. You wouldn’t believe the horror stories we heard about that chain. Others were independent stores such as ours. The most recent one liquidated their excess shipping supplies and equipment on eBay…we won the auction for their boxes and I got a chance to visit their store which was dark, dirty and dingy. I would never feel comfortable leaving anything of value at a place like that. Our location is bright, clean, and inviting which I believe helps tremendously. Another independent store tried opening a 2nd location and very soon thereafter went out of business. That’s a big thing, IMO, is to be careful about over saturating your market with these types of stores.
One of the biggest factors for success in this market is customer service. Numarkets was a customer service NIGHTMARE, especially for the local cosignors, and their eBay feedback was spotty as well. I’m reading stories in this thread about consignors having to wait weeks or even months to get paid once their item sells. Not to mention what can happen if a store closes overnight and you are left with NOTHING. Our turnaround is FAST. Our employees are friendly and helpful and it keeps our customers coming back. Local buyers who win our auctions can pick them up without any handling fees, long waits, or extra hassles.
I also want to touch on one of the first points made in this thread regarding an internet presence. I agree that it is a good idea to have one for a business like this that is tied directly to the internet, but I do feel that the main focus for advertising needs to be in your local market. This is going to be a big focus for us in the coming months. We’ve already established ourselves as the #1 REDOL in Chattanooga, now it’s just a matter of getting more people here in town to become aware of us and this type of market.
I feel confident that our store will be turning a profit in the near future. I feel confident that other REDOLs can do the same. It’s still such a new market that so many people just do not know about. Years from now, when eBay drop-off stores are more ingrained into people’s minds, multiple locations in a given market could work. Right now, you’ve just gotta be sure your market can handle yet another store that not many people are aware of…
Comment by Sam — February 18, 2008 @ 10:46 am PST
Is there any reason why the business model has to be completely one thing or the other?
What I’m getting at is this:
One aspect of the business can be the consignment model. Where items are sold EITHER online or in store.. The operative word being SOLD! Judging from some of the comments in this thread, one would have to be very selective about items taken on consignment and how much is received for each.
The items accepted on consignment need to be as high end as possible and the return to the consignee should be as much as possible. The store owner should break even or make a small profit. Why?
Higher end merchandise attracts higher end in store consigners/buyers. Paying more to the consignees, initially, establishes a favorable word of mouth reputation about the store to their circle of friends. As this part of the business improves, higher profits could be taken based on reputation for competency, cleanliness, etc.
Another aspect of the same business could be merchandise sales EITHER online or in store. Both ends of the business can support and benefit the other. This aspect of the model assumes having knowledge of or access to wholesale priced merchandise. This merchandise is sold online, or in store, or even drop shipped direct from the supplier!
Thus the older consignment/merchandise should have a competitive price advantage over the new, making it more attractive to a certain type bargain hunter. The new merchandise has its own appeal another kind of buyer. Again, both buyers reinforce the other’s behavior.
Finally, the online aspect of the business sells both consignment and new merchandise appealing to the same kind of buyers mentioned earlier.
The three parts of this business model should make a sturdy foundation for a profitable business.
The benefit to this arrangement is each aspect of the business is enhanced by the other parts. The store location is not limited to local traffic. What doesn’t sell locally can be sold online. And vice versa. The consignment aspect brings in sellers who may become buyers, who might not have come in to the store otherwise. Buyers can later become sellers because they’ve experienced the well lit store, the competency, the customre service, etc.
All in all it seems like an interesting idea.
Comment by C.W. Wyatt — May 5, 2008 @ 11:17 am PST