Tamebay reader Glenn is a pretty experienced eBay seller but is facing ever increasing competition from his own suppliers. How do you cope when your supplier starts competing directly with you on the same marketplace? Here in his own words Glenn sums up the problem:
There have been several occasions on which I have been fortunate enough to be the sole seller of a particular product and have turned a good profit in the absence of competition.
However like most sellers I generally find that I am in competition with other sellers and price my products accordingly. I look at my competitors and in particular their sales history and may well choose to let them “sell out” of a product rather than matching them price for price. There are other factors such as Top Rated Seller status, listing content and their feedback profile, but generally I consider price and quantities offered for sale. I do not follow the philosophy of being the lowest priced seller, but by the same token I cant afford to isolate myself and need to price competitively.
This strategy has worked well enough for the last few years and although not a perfect formula it was a formula which worked, until recently. Over the last few months I have personal experience of purchasing CDs from three different wholesalers only to find each one of them opening accounts on eBay and Amazon and selling the same products. I purchased at a price below my selling price and am now faced with the problem of competition against wholesalers who have a limitless supply of products.
I know that there have always been factory outlets and the wholesalers are perfectly entitled to sell on any channel they choose, but it seems to me that they are killing the golden goose. I still purchase CDs from two of the wholesalers, but no where near the range or quantity I used too, because I am not prepared to compete in an unfair fight.
Considering that many professional sellers purchase products to sell on several channels I wonder how others like me will be changing their purchasing strategies.