How to set up a business on eBay

How to set up a business on eBay
Create a business on eBay

Note: Our eBay business feature has been fully updated. This article was first published in August 2012.

Celebrating its twentieth anniversary, eBay has developed into a shopping platform to rival even the mighty Amazon. Today around 11% of all retail purchases are made online according to the ONS (Office of National Statistics), with a peak each year on Cyber Monday.

Around 20 million Britons now use eBay as a retail channel, with thousands of small businesses earning their primary income from eBay alone – there are almost 2,000 eBay millionaires now.

How consumers shop has changed out of all recognition since Pierre Omidyar first set up eBay in 1995. Online retailing has exploded and shows no sign of slowing, as consumers continue to embrace the speed, convenience and savings that online stores can offer them. And with mobile commerce looking set to eclipse e-commerce online, eBay has moved to place its services on every smartphone.

Devin Wenig, eBay Chief Executive Officer, said: "Our new mobile app reflects our commitment to creating great experiences for our buyers and enabling continued success for our sellers. Looking ahead to the next 20 years, our vision is for the world to shop on eBay first because we offer the best choice and most relevance, powered by the simplest and most profitable selling platform."

Buy it now

For businesses the perception that eBay only sells unwanted items that people have stored in their attics has massively changed. The auction site is still at the core of eBay, but items with a 'Buy it now' option make up nearly 80% of all items on the service. The thrill of an auction will continue, but for many consumers, they simply want to find an item they want and buy it.

And the buying option is also what makes eBay such a powerful platform for businesses. With PayPal integrated into eBay, anyone can make a purchase instantly with any payment card they want. This immediacy and integration of one of the world's most popular payment methods ensures eBay has the services businesses need to make their eBay stores attractive to customers.

Business setup

The UK saw eBay open its doors in 1999. The first item sold on was a three track CD from German rock outfit The Scorpions. It sold for £2.89. Fast forward to 2015 and eBay's UK marketplace is visited by 18 million Britons each month.

To set up your own eBay store, you have to meet a number of minimum criteria:

  • You must be PayPal verified (to open a Basic Shop)
  • You must be registered as a business seller on eBay (to open a Featured Shop)
  • Maintain an average 4.4 score or above for a 12-month average (to open a Featured Shop)
  • Maintain an average 4.6 score or above for a 12-month average (to open an Anchor Shop)

There are three types of store you can open on eBay:

  • Basic Shop

This is the most basic store you can open and offers 200 fixed price listings and a one-month minimum contract. You also get your own URL (for example so you can drive buyers directly to your shop.

  • Featured Shop

1200 fixed price listings. A dedicated customer care team. Selling Manager Pro (normally £4.99/month) allows you to automate, improve, and streamline high-volume sales. Manage listings, sales, inventory, feedback, and customer emails in bulk. Discounted international listing rates.

  • Anchor Shop

Unlimited fixed price listings at no extra cost. Dedicated customer care team. Discounted international listing rates. Free three month trial of Storefeeder – a great multi-channel listing tool that allows you to perform all of your e-commerce tasks in one place.

What type of store you choose will depend on a number of factors:

  • Basic Shop (£20.85*/month, insertion fees from £0.10)

Consider a Basic Shop if you list more than 65 fixed price items a month. It's an easy-to-use and affordable solution for sellers who are just starting out.

  • Featured Shop (£62.60*/month, insertion fees from £0.05)

If you're a higher volume seller with more than 600 items per month, a Featured Shop may be right for you. You'll also get free access to Selling Manager Pro, plus, if you're a resident of the UK or Ireland, you receive discounts on your international listings.

  • Anchor Shop (£260.86*/month, insertion fees from £0.00)

If you're a higher volume seller with more than 5,000 items per month, who wants the best savings and the lowest package rates on eBay for domestic selling, an Anchor Shop may be right for you. You'll also get free access to Selling Manager Pro, plus, if you're a resident of the UK or Ireland, you'll receive discounts on your international listings.

(*Prices are inclusive of VAT at 20%).

eBay store

Design your own eBay business store

A major component of your eBay shop will be the fees you will be charged – and check these out here (opens in new tab). There is also a handy fee illustrator (opens in new tab) to help you decide which shop type would suit the level of fees you want to pay for your eBay store.

How your store looks on eBay also needs to be considered. You can of course create your own pages if you know how to build websites, as eBay's pages are built using HTML. However, eBay makes the design of your new store easy with a number of free templates (opens in new tab) to choose from. All you then need to do is load your product images and set your prices.