Tallone
Hero Member
So I went to check my eBay stuff this morning and was greeted with the following image on the eBay home page:
An eBay valet service? eBay will sell my stuff for me?! How does that work? So, I click the link and find out that you can send stuff to sell to one of their valets, they will do all the processing (research, pricing, photos, listing, shipping), and keep 30% of the sale. Reading further, I find that there are limited types of things you can send and each item must be worth at least $40.
And then, at the bottom of their FAQ page, was this little gem:
How do I become a valet?
Valets are carefully screened for inclusion in the program. Requirements include, but are not limited to: (1) ability to list 100,000 listings each month, (2) storage capacity sufficient to hold and manage items received for at least 21 calendar days, (3) ability to list items across all eBay categories, (4) physical presence in all major metropolitan hubs in the U.S. and (5) demonstrated ability to reach Top Rated Seller status on eBay within 90 days of starting valet services.
I didn’t have any interest in becoming a valet in the first place but good lord…
Now, I’m a competent manager. I can organize the bejeezus out of the most complex mess. I can create systems and processes to handle things very efficiently but contemplating what would be required to meet these requirements made me dizzy. Consider the logistics of setting up and managing the staff, physical space, and tracking systems in every “major metropolitan hub in the U.S.” of sufficiently large size to handle 100,000 items per month. I understand that isn’t necessarily 100,000 items in each location and I’m not sure how many hubs eBay is talking about but I would think this would include, at the very least, the following cities: Los Angeles, Seattle, Denver, Houston, St. Louis, Chicago, New York, Atlanta, and maybe a couple of more. 100,000 items spread evenly over 10 cities is 10,000 items per month in each location.
eBay talks about shipping things in this valet system in 12” X 12” X 12” boxes. Stacked 10 boxes high, 10,000 items requires 1,000 square feet of floor space. Of course, you are going to need a lot more room than that to accommodate staff and processing infrastructure. Assuming one person can list an item every 15 minutes (and I think this is a VERY optimistic assumption), you would need 4 full time staff people plus a manager to handle 10,000 items per month.
eBay says that each item has to be worth at least $40 to qualify for the service. So, for the sake of argument, let’s say the average sale price per item is $50. You get 30% of that or $15 per item. If you are moving 10,000 items per month in each location, that is gross revenue of $150,000 per month per location. If each of those 5 staff people make $3,000 per month, that is $15,000 in salaries. Using a 3.0 overhead multiplier, your monthly cost is close to $50,000 per month leaving a net of $100,000 per month. Of course, I suspect the average time required to process an item is more like 30 minutes which will double your cost or, if you prefer, cut your revenue in half to about $50,000 per month per location. If you’re running 10 locations, that is half a million per month or $6,000,000 per year for the enterprise as a whole.
You would need some serious front end capital to put the infrastructure together (warehouse space, office equipment, shipping supplies, etc.). You would also need considerable time to hire and train staff. And eBay wants you to be Top Rated within 3 months. Tall order, that.
These are just kind of “seat of the pants” calculations but the income stream looks pretty good. But it would be an absolute management nightmare if you are starting from scratch. Maybe if you are a shipping company (or something like that) and already have staff and infrastructure in place in multiple cities, it might be doable.
I don’t think I’ll be applying to become an eBay valet. It might be interesting to test the service on a few items, though.
An eBay valet service? eBay will sell my stuff for me?! How does that work? So, I click the link and find out that you can send stuff to sell to one of their valets, they will do all the processing (research, pricing, photos, listing, shipping), and keep 30% of the sale. Reading further, I find that there are limited types of things you can send and each item must be worth at least $40.
And then, at the bottom of their FAQ page, was this little gem:
How do I become a valet?
Valets are carefully screened for inclusion in the program. Requirements include, but are not limited to: (1) ability to list 100,000 listings each month, (2) storage capacity sufficient to hold and manage items received for at least 21 calendar days, (3) ability to list items across all eBay categories, (4) physical presence in all major metropolitan hubs in the U.S. and (5) demonstrated ability to reach Top Rated Seller status on eBay within 90 days of starting valet services.
I didn’t have any interest in becoming a valet in the first place but good lord…
Now, I’m a competent manager. I can organize the bejeezus out of the most complex mess. I can create systems and processes to handle things very efficiently but contemplating what would be required to meet these requirements made me dizzy. Consider the logistics of setting up and managing the staff, physical space, and tracking systems in every “major metropolitan hub in the U.S.” of sufficiently large size to handle 100,000 items per month. I understand that isn’t necessarily 100,000 items in each location and I’m not sure how many hubs eBay is talking about but I would think this would include, at the very least, the following cities: Los Angeles, Seattle, Denver, Houston, St. Louis, Chicago, New York, Atlanta, and maybe a couple of more. 100,000 items spread evenly over 10 cities is 10,000 items per month in each location.
eBay talks about shipping things in this valet system in 12” X 12” X 12” boxes. Stacked 10 boxes high, 10,000 items requires 1,000 square feet of floor space. Of course, you are going to need a lot more room than that to accommodate staff and processing infrastructure. Assuming one person can list an item every 15 minutes (and I think this is a VERY optimistic assumption), you would need 4 full time staff people plus a manager to handle 10,000 items per month.
eBay says that each item has to be worth at least $40 to qualify for the service. So, for the sake of argument, let’s say the average sale price per item is $50. You get 30% of that or $15 per item. If you are moving 10,000 items per month in each location, that is gross revenue of $150,000 per month per location. If each of those 5 staff people make $3,000 per month, that is $15,000 in salaries. Using a 3.0 overhead multiplier, your monthly cost is close to $50,000 per month leaving a net of $100,000 per month. Of course, I suspect the average time required to process an item is more like 30 minutes which will double your cost or, if you prefer, cut your revenue in half to about $50,000 per month per location. If you’re running 10 locations, that is half a million per month or $6,000,000 per year for the enterprise as a whole.
You would need some serious front end capital to put the infrastructure together (warehouse space, office equipment, shipping supplies, etc.). You would also need considerable time to hire and train staff. And eBay wants you to be Top Rated within 3 months. Tall order, that.
These are just kind of “seat of the pants” calculations but the income stream looks pretty good. But it would be an absolute management nightmare if you are starting from scratch. Maybe if you are a shipping company (or something like that) and already have staff and infrastructure in place in multiple cities, it might be doable.
I don’t think I’ll be applying to become an eBay valet. It might be interesting to test the service on a few items, though.
