EBay 'Drop' Shops Growing In Popularity
POSTED: 7:04 pm EDT July 8,
2004
UPDATED: 8:02 pm EDT July 8,
2004
RICHARDSON, Texas -- More than 95 million people have purchased a variety of items at auction on eBay.com. Only 7 million people, though, have sold merchandise on the popular Web site.The disparity has created a relatively new niche market for businesses called "drop-off" shops. The shops act as a "middleman" for people who want to sell goods on auction sites like eBay, but might not have the time or Internet experience to post the items themselves.Bill Scherek recently opened a drop-off shop, auctiongateway.com, in Richardson. For a fee percentage of 35 percent of the total sale, the company performs the legwork required to post items for sale.
"We do the digital photography, we do the product write-up, we do the research if it's necessary, we list it on eBay, handle all the customer service correspondence, we collect the money and ship the product, and send them 65 percent of the gross sale price," Scherek said.This new class of consignment retail business has generated growing popularity and a new breed of customers. Business leaders also are taking notice.AuctionDrop, a San Carlos, Calif., company is one of the most successful similar companies in the United States, according to Entrepreneur.com. The company operates about 40 locations split between the East and West coasts. Its management raised about $6 million of venture capital, and the chain generated more than $1 million in revenue last year.
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