Local I Sold it On Ebay store vacates, business model in pricey strip mall still suspect |
Any guesses what’s circled in red in the picture above?
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.
I just reread the original post to see if I wanted to take back anything I wrote today. Sometimes you write things that don’t prove out to be accurate over time or were terribly flawed from the beginning, but I couldn’t see back then how this business could make it having to pay the overpriced strip mall lease rates. And still can’t.
So recently we are up shopping because Best Buy is in the same complex and what do I see?
Yes, that same iSolditonEbay store is moving a little over a year later. They cite having two other locations and I didn’t get a chance to talk to the owner to see if the reason for moving was the high rent prices, so this post shouldn’t be deemed a “look, I told you so neener neener” type post. Rather, it should be further evidence to question how or why people would open one of these beautiful stores in an expensive strip mall if they intend to move location over 15 miles away. Location couldn’t have been that valuable. At least in this case.
An isolated case? I don’t think so.
I can see the model working much better in a less expensive location. Buy a house and renovate it on a budget. Don’t go to a strip mall and think the people will come because hey, look it’s in a strip mall. One of the first rules of managing business expenses is watch overspending. High rent if you don’t have a high traffic business can be a major exposed artery. And it can kill a business in the first five years when cash flow is usually most vulnerable.
Unlike visiting a retail store, shopping in a mall or eating out, people don’t just go out thinking: “You know what, we need to go sell some stuff on eBay!” If they put that much thought into it, then why not get their own account or a friend to do it for them? Or better yet hit the yellow pages or [gasp] search engine, which leads into my other point that if one of these business can’t sell itself in the search engines they might have a hard time selling my stuff on eBay too where the competition is every bit as fierce. It’s not that hard a stretch, but I was challenged on this theory too whether or not a brick and mortar business like this having no search engine presence is important.
That’s ok, I don’t mind being challenged on my opinions. That’s just another way to become more enlightened and learn more about business. The problem I see is a higher proportion of people who take issues in the comments area don’t stick around long enough to see the outcome.
A year later the I Sold It on EBay store and business that was on such strong ground is moving. I’m sticking by my original argument to find a different business opportunity or if you go into something like this then don’t overspend on location.
I don’t know if they moved to another strip mall location or not. Maybe I should keep track of the two other locations and see where they are at in a year or two. And perhaps with that post I can get an interview with the owners to find out what really happens in an I Sold It on Ebay business.
Did this post make you go hmm?
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I used the dis-services of “I Sold It”, and got totally ripped off. I sent collector cards to 9 different “I Sold It” stores in different geographical areas to be listed (three to each). I was previously Sales & Marketing Director for the company that printed these particular cards. I received payment from the Ann Arbor store for 2 of the sold cards. The third card was reportedly sent back to me by the owner of the store, but the envelope was ripped open and empty except for the letter from the owner. Apparently someone at one of the franchise stores determined for himself that these cards were counterfeit (which they were not). An internal memo alerted the other stores, who in most cases acted by not listing my items, not returning them, and breaking my contract for services with their organization. From one branch, I received an inappropriate phone call. My loss is many hundreds of dollars, but would cost more than that in time and money to legally pursue. I am writing this in hope that others are not taken in by this company.
Comment by Paul Burdick — May 14, 2007 @ 9:51 am PST
Just curious, but what kind of collector’s cards, Paul? And why did you choose to use I Sold It and not eBay it yourself? Convenience?
Comment by TDavid — May 14, 2007 @ 10:34 am PST
Hey TDavid, have you been to AmItheOnlyOne.org? It’s a website started by 2 previous IsoldIt owners to show people how the business model is flawed.
Comment by Armando — May 30, 2007 @ 9:49 am PST
No Armando, I’d never seen that site. Thanks for the tip, it’s got some good information that prospective franchisees should consult before taking the plunge.
Comment by TDavid — May 30, 2007 @ 10:03 am PST
Tell me about it. I own an independent eBay drop off business called Vendelo so it is important for me to know what is going on in the industry especially with the leader. Do you sell anything on eBay? Check out my blog http://vendelo.blogspot.com if you get a chance. I write about my entrepreneur and eBay selling experiences.
Comment by Armando — May 30, 2007 @ 10:37 am PST
Actually … a local eBay dropoff is suing me about an article I wrote about them (and their “business model”) - they so far have dragged it out in the courts to over a year and a half.
I may have beaten you to the punch about iSoldit having problems and the shells of stores not being good advertising.
I discuss these types of things regularly.
Comment by Rus — May 31, 2007 @ 4:45 pm PST
Didn’t realize there was some kind of race, Rus
Just an observation I made one day last year and at the time if you go back to my April 2006 post linked above you’ll see considerable interest since then. I wasn’t aware of Entrepreneur magazine declaring this a great business in 2007 which makes the story even more Hmm-inspiring.
Comment by TDavid — May 31, 2007 @ 5:11 pm PST
Ha - no race - just that this has been forecast by those who have actually done business with these eBay dropoffs. The statement - “I give it a year” - is finally coming to fruition.
Comment by Rus — May 31, 2007 @ 7:01 pm PST
I briefly was Manager of an ISoldit location. It was one of three that had been opened by the same entrepreneur. Within one year of opening, the store was for sale. Because I thought about “buying my own job”, I looked at the books as a prospective purchaser. In fact, this location was getting eaten up by the lease payments. There was no logical way that the store could carry that payment on its eBay model alone. Shortly thereafter, there was only one remaining employee at that location and it wasn’t me. The entrepreneur then changed the business model to include purchasing pallet lots and using the store staff to sell their own goods on eBay as well as the drop off merchandise. I can’t say for certain how it’s doing but it is still open in its premier retail location. I couldn’t see paying premium rates for what is essentially a second-hand merchandise store.
Comment by Dave — June 27, 2007 @ 7:39 pm PST
TDavid, I thought about Isoldit back in Aug of 05 and and was amazed at how quickly they said they were growing with new franchises every day on their site. I was doing ebay part time and making very good money–mainly due to the fact I have a good eye for what sells. Profit was great because I was mainly getting stuff out of the dumpsters!
Anyway, having been in the retail biz previously, I, too was amazed at the business model. Didn’t make a bit of sense for me to open one on my own, much less pay a franchise fee! Anybody who purchases one of these is a definite idiot and needs to be parted with their money. Only way for you to survive is to buy and resell your own items. Even that’s not foolproof either.
Bob
Comment by Bob — September 21, 2007 @ 9:41 am PST
I took several things from my business to the I Sold It Store in Lake Zurich, IL. One item sold in July for $200.00. I had asked and asked for the money and got a run around. Now I find that they’ve posted a sign on their old location saying they moved but guess what? They didn’t give a new address. Go figure. So now I’m not only out my $200.00 but I have no idea if they’ve actually thrown away my other items or if they’ve sold them.
Anyone having any connection to the people that owned and/or ran the store in Lake Zurich, IL please feel free to contact me. I smell lawsuit. And yes, I know it will cost more for attorney’s fee’s etc. but it’s now become the principle of the matter.
Elizabeth Freshour - Lake Zurich, IL
Comment by Elizabeth Freshour — October 18, 2007 @ 5:39 pm PST
Before moving to PA in 2005 my husband sold things at I Sold It in Lake Zurich, IL. He didn’t have any problems and received his checks in a timely manner. My son brought things to the same store in May 2007 and it has been a completely different experience for him. All of his items sold by June 15 and he was told that he would receive a check for $384 in
4 weeks. He still hasn’t received a check despite calling every other week since late August. His last call was 10/20 and the phone had been disconnected.
Does anyone know what is happening with the Lake Zurich, IL I Sold It?
Mary Ann Sokola - Perkasie, PA
Comment by Mary Ann Sokola — October 24, 2007 @ 10:07 am PST
Fascinating happenings in the drop off store world these days. As a long time eBay seller myself, I had no doubt that there would be a huge shakeout in this business. Too much sizzle, and too little steak.
TDavid,
That store, (er, former store), you pictured is in my area and, as far as I know, they did not move or open in Auburn and/or Federal Way.
Comment by Russ — November 10, 2007 @ 3:26 pm PST
I’m entering a lawsuit against a former owner of the I sold it location in Wixom, Michigan. It was my first experience with using an agent to handle a eBay sale. It was similar to the Lake Zurich situation. My item was sold online and I was told to expect payment within 4 weeks. I visited the store only to find it closed.I attempted calling the store phone number after that time and only got an answering machine whose message said that questions about outstanding payments should be sent to an email address. I sent several emails with no response of any kind. Finally my inquiries were returned as undeliverable because the mailbox was full. I also discovered that the itme I dropped off was sold under the owner’s private account so eBay could not help since my name was not showing as seller or buyer. After investigating I found the name and address of the owner and have had my lawyer send a letter requesting payment. If there is no response to that I will file a police report and pursue him in civil court. I have, however, dealt with the I sold it in Ann Arbor and have found them to be very helpful and sold several items with no problems.
Comment by RichardB — January 5, 2008 @ 11:10 am PST
Quick question, I am looking at a store that in it’s first year was in the black, which for any retail store in their first year is a good sign. However, I am curious about what everyone here has posted. It sounds as if one was just dropped and others have made terrible business decisions, just because you buy a business doesn’t mean you a smart business person. Does anyone have a more realistic positive experience with a store that has been run by a quality business person?
Comment by Leanne — March 10, 2008 @ 10:40 pm PST
These iSoldIt Ebay drop off stores are dropping like flies! Two that opened in my area both closed after about 6-8 months. It really is NOT a good business model long term. As a matter of fact it is one of the biggest Franchise Scams I’ve ever seen. Sure some are still doing business but I suspect MOST have failed. Why would anyone need to pay a Franchise fee for an ebay drop off business is a mystery to me.
Comment by ken — April 15, 2008 @ 10:34 pm PST
Oh I have been ripped off my my local I sold it store and I’m hoping to take some legal action against them. I sold three items there LAST MARCH and I still have not been paid for them. The local store is now closed and was “moving to a new location.” I have contacted the BBB to officially file a complaint, but nothing can be done because the owner of the store was not returning their phone calls or picking up the certified letters that both myself and BBB have sent. I’ve contacted the franchise several times and get the same line of crap every time, “each store is independently owned and operated. . . blah, blah, blah.” Do NOT sell anything here!!!!!
Comment by Rachael — August 31, 2008 @ 10:52 am PST
I had listed a very expensive turkish silk rug my grama gave me to pay for my wedding it sold and then they told me i would have to wait four weeks to six weeks max for my 3,900 being my sixty percent other than the forty they took for their fee i was fine with them making that much off of it cuz i need the money really bad. so i planned the wedding and now its been three weeks after i was supposed to get paid and the wedding is scheduled for friday and i cant afford it . i have called all three stores in the area and left a massage and email every day for the past three weeks and still no response. im so screwed i just wish they would call me and let me know what their doing. brett_life [at] yahoo (dot) com please contact me with any advice
Comment by brett — October 22, 2008 @ 6:16 pm PST
I just had my local I Sold It store in Baton Rouge La auction off items for me. I’m screwed as well. The store has closed it’s doors, their voice mailbox is full and I have no way to contact them. Sound familiar? Thanks to this website I was able to get phone numbers and e-mail addresses for the CEO of the company. I just e-mailed him and will wait on a response. I am not feeling very optimistic that I will hear from them. I’d advise anyone wanting to use this service to think hard about leaving your valuable in their hands. My return on a collection that cost me over a thousand dollars is about fifty dollars. They advised me not to put a limit on my collection. They did not list my items long enough to get the bids up. I suspect they knew they were closing their doors and were in a hurry to get the items sold. My sister-in-law is an attorney and I plan to speak with her today. I wish I had looked at this website before I made the decision to sell through them.
Comment by Connie — December 14, 2008 @ 5:17 am PST
Whoever said this is a great business model is smoking a lot of crack. I am a platinum powerseller on eBay. I have my own eBay business that I guarantee you is far more succesful than any iSold it store.
They claim on their commercials that they are the #1 seller on eBay. Total lie everydaysource and accstation are the #1 sellers on eBay. I have 6 times as many feedbacks as that iSoldit store that I used that just went out of business.
I recently had an item in storage that was big and heavy and I just simply didn’t have the time to ship it myself as this oversized stuff would have been a pain to pack. I didn’t want to throw it in a dumpster as I thought somebody would be able to use it, and at the same time it was taking up space and I needed to get rid of it. I decided to drop this stuff at an iSold it store. It was a heavy antique trunk that I used in a photoshoot and I just didn’t want to bother shipping something this heavy and big. I actually bought it off eBay in an auction for $200
Anyways I told the iSold it store that I just wanted to get rid of this stuff and not have to worry about shipping.
The owner at the iSold it store and I agreed that it would be auctioned off at a starting price of $9.95 and I didn’t really care what it sold for I just wanted to get rid of it. I tried to get them to start it at a penny but they said that they won’t start any auction for less than $9.95.
so one day I decide to look up my auction, and they started the bidding at $24.95 and it got one bid. I get a check in the mail for $9. The reason you start auctions at a penny or a dollar is to get people’s attention and get them to bookmark or click on “watch item” and then it will usually start a bidding war. By starting to $24.95 it made the auction look like the seller was looking to get $24.95 on it and it ended up ending with 1 bid.
I didn’t complain because I just wanted to get this out of my storage but the bottom line is that these guys had no idea what they were doing. If they had any brains whatsoever they would have passed on this business oppurtunity.
I drove past this business today and it’s gone. They haven’t received any feedback since August which indicates they went out of business shortly after I dropped this off.
Bottom line is that this is a sure loser and the only people getting rich are the franchisee’s. With the new eBay policies this business is even further in the grave.
Items auctioned off by iSoldit stores sell for significantly less. The reason being because most buyers know that iSold it stores are middle men and know very little about the products they are selling. People are more likely to drop off counterfeit and broken goods to iSold it stores.
An example is my friend bought a complete set of 1985 topps baseball cards from an iSold it store. The set had every card in it but the Roger Clemens, Kirby Puckett, and Mark McGwire rookies. Obviously the owner of that iSold it store knew nothing about baseball cards. My friend end up filing a dispute with paypal to get his money back. This is an example of why ASP’s (Average Selling Prices) on items sold from iSold it stores sell for significantly less. Would you rather buy a laptop from an iSold it store or the original owner who knows if their were any issues with it.
iSold it stores usually have poor feedback and with eBay’s now tying your feedback to your visibility in search results, this has gotta hurt iSold it stores.
These iSoldit stores have to give the franchise a cut of their sales, have expensive rent to pay, and when I look at their feedback histories it looks like they do about 1/2 to 1/3rd of the volume that I do (and I sell my own stuff, not only peoples stuff); I can’t imagine how I could stay in business if I did 33% of the revenue that I do, had lower profit margins, expensive rent (I work out of my home), and had to pay a cut of the sales to the franchise.
Also think about this, if you have an expensive watch or guitar to sell, in most but not all cases your going to sell it yourself on eBay before you take it to an iSoldit store. So people end bringing their crap to these stores.
So the iSold it store sells this item with their crappy pictures and it sells for $25, and one of the employees gets paid to pack it and photograph it. Now you can see why this business has failure written all over it.
This is a failure and I’m willing to bet that a lot more stores are closing than opening.
Now I’m sure with this recession more people who aren’t “computer savy” are bringing in their crap to iSold it stores to help pay bills but the problem is that with the recession ASP’s (average selling price) on eBay are *WAY* down.
The business model doesn’t work. I’m sure there are a few exceptions but those are the exceptions not the rule. I’ve looked at the feedback of many iSoldit stores and they don’t have the revenues I have, profit margins are much smaller, and they are paying a ton of overhead. The vast majority of them aren’t money and many have gone out of business.
Comment by David Portnoy — February 7, 2009 @ 1:08 am PST
I think it started off as a good idea. A few major things have changed since the inception of their model; namely the Ebay/Paypal ‘war on sellers’ - where they raised fees 60%, placed holds on transactions, disallowed negative feedback ability for sellers, etc.
Anyone with half a brain could look at the model isolditonebay propose and recognize overhead discrepancies.
I am interested in collabing with anyone for a better model, based on experiences selling online and case studies.
send an email to makeaformula at yahoo, subject ebay
Comment by aaron — March 30, 2009 @ 1:35 am PST