Industry sector: Retail and wholesale

Ebay trader: Postage, stationery, advertising

Enter in your cash flow forecast the amounts you will spend on:

  • postage. Your postage costs will depend on the type of goods that you sell. For example, things like stamps are small and light to send - antique furniture will be a good deal more costly. You may decide to pass on some or all of your postage costs to buyers. However, note that eBay policy prohibits sellers from charging inflated postage and 'handling' costs
  • business stationery such as letterheads, invoices, printer paper and so on. Your local printer will be able to give you an estimate of how much a package of essential business stationery costs. You will probably pay for this in month one or two and then reorder as necessary later in the year. Many eBay businesses use the standard invoice format generated by eBay or by special seller's software. The free eBay 'Checkout' feature automatically sends the buyer an invoice as soon as the listing ends
  • miscellaneous stationery items
  • advertising. This might include promoting an eBay 'Shop' or advertising a traditional shop that you run alongside your eBay business. You might want to take advantage of eBay's promotional tools to boost the profile of your listings

Freight and courier charges

You're quite likely to be spending considerable amounts each month on parcel or freight services. You'll need to decide which carrier is the best suited to the products you sell and provides the most economical and efficient service. You could consider using several different carriers depending on what you're sending.

Unlike general business postage costs and other overheads, you'll only incur shipping charges when you make a sale. So if you think you'll sell 100 items online each month, and they'll cost you £2 an item to send, then your monthly shipping costs will be £200.

It's important to price up shipping costs before you start selling. If you're going to offer free or subsidised delivery then you'll need to know how much to build into your margins so that you make a profit. And if you intend to charge for shipping at cost price you'll need to know how much to charge.

As with your selling prices, it's often important to be competitive with shipping charges. If you're planning to charge £5 to send something make sure your competitors aren't selling the same item at the same price as you - but with free postage.