- Matthew Thorsen
- Erik Holcomb and Peter Becker
This is how Global Garage Sale, an eBay drop-off store in Winooski, made its biggest sale: In May, a woman from Upstate New York phoned to say she wanted to sell an 1875 baseball trophy she had recently inherited. A man in New York offered her $5000 for it, but she had heard that the guys at Global Garage Sale could fetch top dollar for collectibles on the online auction site. Erik Holcomb, the store's scruffy, bearded 27-year-old co-owner, knew little about baseball trophies, but he asked her to bring it to the store.
When she arrived at the airy, brick warehouse -- tucked in the back of a renovated woolen mill on West Canal Street -- Holcomb and Peter Becker, his 40-year-old longhaired business partner, eyed the trophy. They spent a few minutes researching it online, then confidently predicted that they could sell it for between $60,000 and $90,000. "It was like a real-life 'Antiques Roadshow,'" Holcomb remembers. "Except that we actually sold it."
The two entrepreneurs photographed the trophy against a white backdrop, using professional-quality cameras and lighting. They wrote a description, slapped on an opening bid of $49,999, and posted it on eBay. They drew only one bid until the final 15 seconds of the 10-day auction, when the price jumped $25,000. A collector in New York City ended up with it, paying more than $76,000. When the auction was over, they sent their client a check, minus their commission. She called to thank them -- she'd just bought a new car.
It's a memorable anecdote, but this is just one of hundreds of transactions GGS has completed this year, and their business is growing. In 2004, they moved $75,000 of merchandise on eBay. In the first eight months of 2005, they've sold more than $500,000. Holcomb expects to hit at least $700,000 before the year is through.
Not bad for a couple of former T-shirt tie-dyers.
The store is part of a national trend. In December 2003, Holcomb and Becker's laid-back, funky storefront was Vermont's first eBay drop-off store. Today there are two others in Chittenden County. In other parts of the country, chains have popped up that will sell your valuables for you online through dozens of drop-off outlets. And an entire cottage industry of eBay-sanctioned "Trading Assistants" provide essentially the same service from their homes; there are more than 100 in Vermont, with screennames such as "vermontgypsy" and
"8kidz2feed." According to a survey released last month by ACNeilsen International, more than 724,000 Americans cite eBay as their primary or secondary source of income.
Holcomb welcomes the competition. Like other drop-off storeowners, he says his focus on convenience and first-rate service keeps customers coming back. "When we first started out," he notes, "everybody was skeptical about what we were doing." The other drop-off stores, he says, "helped legitimize our business." And owners of these businesses agree there's still room for more. Sonny Schumacher, co-owner of vBay in Williston, optimistically describes the growth potential as "mind-boggling."
It's fairly easy to grasp why eBay and its Trading Assistants are popular. For 10 years, eBay has enabled anyone with an Internet connection to buy and sell sundry items online to its more than 100 million users. In the first six months of 2005 alone, eBay moved more than $10.6 billion worth of stuff. The site might not be the most effective place to sell popular products -- you might have more luck listing your '97 Camry in a newspaper, for instance. But it's especially attractive for sellers of collectibles or rarities that might be difficult to unload locally.
Peter Becker gestures at his warehouse. It's stocked with, among other things, musical instruments, World War I recruitment posters, a Qing Dynasty bowl that just sold for $375 and a pair of lizard-skin cowboy boots. A clipboard near the packing counter confirms that the $5000 player piano shipped out last week. Becker explains that you might need to catch millions of eyeballs in order to sell some of this merch for what it's worth. "The only way to get a million people to see this stuff around here is to put it on eBay," he says.
So why don't their customers just put it on eBay themselves? Though buying on eBay is relatively simple, selling can be complicated. Sellers must be tech-savvy or willing to learn how to handle listing the item online, posting good photos of it and processing the payments, as well as packing and shipping it to the buyer. If buyers feel they got screwed, they can leave negative feedback on a seller's profile, which decreases the likelihood of future sales. For people who just want to unload one or two items every now and then, the whole process can seem like a hassle.
Enter the Trading Assistants -- that's the title eBay gives to all of its auction brokers, including drop-off stores. To claim the title, and be included in eBay's searchable database, dealers must have sold four items in the past 30 days, and have at least 50 satisfied customers and a 97 percent customer-approval rating. Their eBay profiles generally include street addresses and phone numbers, so they're easy to contact in case of a problem.
Trading Assistants get paid a commission. Most charge roughly 30 percent -- not including the nominal fees eBay charges to list the items -- though that number often falls as the price rises. For a high-priced item such as the baseball trophy, Holcomb says his commission is "negotiable." Most advise customers not to bring them anything worth less than $75 or $100.
Trading Assistants often justify this payment by pointing out that their good reputations make buyers more willing to do business with them. Fraud is still a concern on eBay, and users who aren't careful can get duped. But anyone viewing an item on the site can see how many items the seller has sold, and how many complaints people have lodged. Buyers may be willing to pay more to experienced, reliable sellers like GGS, which has sold 1411 items on the site and received only one complaint in the last year.
GGS' success has enabled it to climb the eBay ladder from Trading Assistant to "Trading Post," a distinction reserved for drop-off stores that are open to the public at regular hours, have more than 500 satisfied customers, boast a 98 percent customer approval rating, and sell more than $25,000 worth of merchandise a month.
So far, GGS is Vermont's only Trading Post. But that hasn't stopped Peter Jewett, Peter Bruhn and Michael Morris from calling their Burlington eBay drop-off store "Go Trading Post." The three college students started trading on eBay as a hobby last summer. Now they occupy a second-floor walk-up on Pearl Street above a salon. Their tiny, 19-by-11-foot, air-conditioned suite is literally packed with oddments and boxes. Jewett says the piles of stuff are sometimes overwhelming. "A lot of people come in the door and take a step back and go, 'Oh, are you guys the eBay guys?'" he says, a note of disbelief in his voice.
The shorthaired, 22-year-old Champlain College E-Business Management major guzzles a can of Rockstar Energy drink between answering questions with his Maine accent. He sits behind the front desk, an antique Remington 9 typewriter poised beside his desktop keyboard. A pink Energizer bunny wearing sunglasses and flip-flops stands on a white background on the table next to him, surrounded by lights and a camera. The bunny's about to go up on eBay.
Jewett says that at first they got most of their inventory from family and friends, but business picked up after his great aunt died and they sold some of her things. "Before we knew it, we had people knocking on our door," he says. The students have also sold inventory for local antique stores, including the one owned by Morris' mom, and they've helped liquidate leftover office supplies. Peter Bruhn adds that they recently sold his neighbor's car.
They've also benefited from their association with Champ- lain College -- Bruhn, like Jewett, is a student there. They say they often bounce ideas off their professors, and apply their schoolwork to their extracurricular activity. "Instead of sitting in class daydreaming while the teacher's talking about cash flow," Jewett notes, "I'm actually thinking about my own business."
They advertise their services using door hangers, and by displaying a sign outside their building. They've even designed company T-shirts, which they offer for sale on the Cafe Press website. Still, Jewett says most of their business comes from word of mouth. No new customers wander in during a recent weekday afternoon interview.
Jewett and Bruhn have sold 621 items, and have received only four negative comments in the past year. They say they're making a profit, though they're plowing most of it back into the business. Regardless, Jewett says he's having a good time. "It's a lot more fun hanging with my friends than working for The Man," he says.
Sonny Schumacher phrases the sentiment differently, but seems to share it. The 41-year-old full-time airline pilot invested in his vBay store with a friend after investigating several other small-business concepts. "We are cogs in big machines," he says of himself and his business partner. "It's nice to say, 'Let's be in charge of things for a change.'"
vBay, which looks more like a Kinko's than an Internet start-up, opened its doors in a strip mall off Route 2 seven months ago. Since then, they've sold 310 items and logged zero complaints. A new store manager arrived in June, and they're looking to hire more part-time help.
Schumacher says they don't expect to get much drive-by traffic, especially since they're located in the back of their building. He sees the store as a destination spot. He wants families to stop by on a Saturday, after running errands. "We want to be on their list," he says.
To get there, the store is advertising in the Yellow Pages, and partnering with groups such as the Flynn Center for a fundraising drive. The Flynn will encourage its members to bring items to vBay to sell. vBay will charge a reduced commission, then give the proceeds of the sale to the nonprofit. Schumacher hopes that once the customers give the service a try, they'll come back.
As with other drop-off stores, he's also hoping to franchise someday; several chains have already cornered part of the market elsewhere in the country. In 10 or 15 years, Schumacher predicts, the entire industry will be dominated by five or 10 chains -- he hopes vBay will be one of them.
Not everyone is sold on the idea. Dick Noreault, owner of Main Street Sportscards in Winooski, is still moving plenty of collectibles in person. Although he acknowledges that many of his customers now check prices online, he hasn't seen a drop in sales. "I've had people come in and say they won't buy anything on eBay," he says. "Overall, people like to see what they're buying."
David Steiner, president of AuctionBytes.com, an online auction resource, questions whether the drop-off-store business model is viable. In an August 12 article in the Milwaukee Journal Sentinel, he says that he's suspicious of the concept. "The beauty of eBay has always been that it is a person-to-person transaction, that it eliminates the middleman, and now these consignment stores are putting the middleman back in."
Not surprisingly, Hol-comb and Becker at GGS dismiss this logic, pointing to their skyrocketing sales. "We get high school kids here, we get grandma and grandpa," Holcomb notes. "They've learned how much work it is," says Becker, "and how hard it is to get it right."
"Not everybody who starts [a drop-off store] is going to stay with it forever," Holcomb says, "but for the long run, there are going to be companies like ours forever."