In 1995, when Pierre Omidyar introduced an online business venue that was essentially a virtual garage sale with auction pricing, no one knew a retailing revolution was about to occur.

That site became known as eBay, and it's hard to find someone today who hasn't at least heard of the popular online auction company. On any given day on the site, an estimated 12 million new and used items are available, 1.7 million new listings are posted, and sales totaling some $40 million take place. And all it takes to get your share of that market, which is worth nearly $15 billion annually, is a computer, a modern, a digital camera or scanner, and something to sell.

What's important to understand from the start is that eBay is a sales channel that you can use exclusively or in addition to selling through a retail operation, mail order catalog, independent Web site or network of direct salespeople. You decide the type of business you want to have, what type of merchandise you're going to sell and how you're going to operate.

To sell on eBay, you'll pay a listing fee to post your merchandise and a final value fee (a small percentage of the sale price) when the item sells. To get a full explanation of eBay fees, check the eBay site.

What Can You Sell on eBay?

Deciding what to sell on eBay can be particularly challenging because your options are virtually limitless. Some of the more popular categories of items are cars, computers, consumer electronics, books, movies, music, sports items, collectibles, clothing and accessories.

Though eBay is a popular place for the sale of used items--ranging from high-dollar antiques to pieces of secondhand junk--it's also a good venue for brand-new, up-to-the-minute merchandise of all types and in all price ranges. Nona M. Cunane, 30, started out selling antiques on eBay in 1998. She did well, but decided she really wanted to work with a product she enjoyed more and that was easier to ship. So Cunane launched Stylebug.com, an online business that specializes in high-end designer clothing for women. Her Bear, Delaware, company does about $800,000 per year in sales--half of that on eBay.

Adam Ginsberg, 35, was already selling billiard tables in his retail store in Los Angeles when he auctioned one on eBay on a lark. It sold so he put up another one. Within a year, he had closed his retail store and was selling exclusively on eBay under the name Zbilliards. This year, he predicts his eBay sales will hit $15 million.

David Schultz, 27, learned about eBay when his former boss asked him to study ways to sell merchandise online. Schultz launched IEPVisions in Orlando, Florida, in 2000 to sell baby and children's furniture primarily on eBay; he expects 2003 sales to reach between $2.2 million and $2.8 million

Can you duplicate the success of these entrepreneurs? They all say sure--as long as you choose the right product line and apply sound business practices to your operation. As you take the first step of deciding what to sell on eBay, keep these points in mind:

* The right product: Don't choose a product based on potential profits alone; be sure it's something you'll enjoy selling.

* Cost and sale price: How much will the item cost you, and how much can you reasonably expect to sell it for?

* Availability: Is the merchandise you need readily available, or will you risk having to deal with supply problems?

* Storage: Do you have room to store the merchandise?

* Packing and shipping: Consider what's involved in packing and shipping the merchandise. Even though the buyer typically pays the shipping costs, think about your labor, time and potential breakage.

* Seasonal issues: Will the item sell year-round, or will it be subject to seasonal fluctuations?

eBay does place some restriction on what can be sold on the site and provides a detailed list of forbidden and questionable items. Essentially eBay prohibits the sale of items that are illegal, fraudulent or harmful in any way; that might cause injury or damage; or that might infringe or someone's trademark or copyright Users are responsible for ensuring their items are acceptable. If you do post an item for sale that is prohibited, eBay will notify you and terminate the listing.

If you buy from wholesalers, choose them carefully. You'll see plenty of ads on the Internet for liquidators, closeout sources, distributors and wholesalers--but, Schultz points out keep in mind that everyone else has access to those same resources. "You need to find your niche," he says. The best approach is to decide what you're going to sell, then look for a source for it. Of course, you should always deal with reputable suppliers who provide quality merchandise and top-notch service.

How Do You Sell on eBay?

eBay is not a one-size-fits-all site--you can choose among several different types of auctions and fixed-priced ways to sell your merchandise. In a basic eBay auction, you post your item with a starting price (the amount at which bidding starts) and wait for bidders to drive the price up. You are then obligated to sell to the highest bidder when the auction closes.

You can also set a reserve price, which is a hidden minimum price that is the lowest amount you're willing to accept. Buyers are not shown what the reserve price is, and if it is not met, you are not obligated to sell the item.

eBay offers a "Buy It Now" feature that gives bidders the option to buy your item immediately for a set price. Or you can choose a fixed-price listing, which simply puts the item up for sale at a set price, with no bidding allowed.

If you have two or more identical items for sale, you can post them in the same auction by using a Dutch (or multiple-item) auction. In addition, eBay offers restricted-access auctions, which can be used for a variety of reasons, but primarily to make it easy for buyers and sellers to find or avoid adult-only merchandise.

In addition to auctions, you can also set up your own eBay store, which will allow you to sell auction and fixed-price merchandise from your special location on eBay. You'll pay a monthly fee based on the level of store services you want, plus additional fees for items listed and sold.

The Technical Side of eBay

eBay has evolved into one of the most user-friendly sites on the Internet. Getting set up as a user is a simple process that you can complete in just a few minutes. You'll be required to provide your name, address, e-mail and telephone number, as well as a credit card number and your checking account information, eBay uses this information to confirm your identity--which protects the integrity of its operation--and to collect auction fees. If your contact information changes, be sure to notify eBay immediately.

You must register in order to buy or sell on eBay, but you can browse around the site without registering. Before you do any business on eBay, be sure to take some time to get to know the site. Set aside several hours to get online and browse around, study listings, read the help pages, understand the various tools and how you can use them, check out the forums, and get comfortable with how the site works.

Once your business is up and running, you'll probably want to consider using supplemental auction management software, which will save time and money, make you more efficient, and improve the level of customer service you offer.

Customer Service the eBay Way

Providing top-notch customer service is an essential element to successful eBay selling. "Everything on eBay is about total customer service," explains Ginsberg. He has three full-time employees who answer e-mail and phone calls from his customers.

"You can't just respond to an e-mail two days later or ship a week later," says Cunane. Whenever her customers ask a question about a garment or sizing, they want an answer fast--and if they don't get it, they probably won't bid on the item. But when your customers are happy with the service, they'll likely buy items from you again. "Make the buyer feel like they're involved in the whole process," Cunane advises. "Answer e-mall quickly, ship within two days of receiving payment and send them a tracking number"

Schultz agrees. "Customer service is your [top] priority, and it's going to take more time than you think," he explains. "For every auction you put up, you're probably going to get at least two e-mails that have to be answered personally."

If you see a pattern in the questions, consider addressing those issues in your listings or on your "About Me" page--a free service eBay offers to sellers to post information about themselves and their operations--or in your eBay store, if you have one, In addition, Schultz recommends developing standard responses that you can cut and paste into e-mails to speed up your answers.