In Kent, Ohio sits a 2,500-square-foot warehouse with garage space that offers clients restoration through recycling. TunerJunkyard.com is a subsidiary of Lost Gypsy Forge, Inc,. It's owned and managed by Marisa Alma Torres and Jerod Husvar. TunerJunkyard.com started out in October 2007 by selling restored automotive parts on eBay, using a mix of online auctions and eBay ProStores as the company's main selling channels.
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» Vendio Lifts Veil on eBay Competitor Strategy In an interview with Ecommerce-Guide.com, Jerod Husvar said that his eBay business resulted in the purchase of the warehouse and garage, and it also meant turning down a well-paying IT job to run TunerJunkyard.com full-time." With a successful business underway, Husvar said that this year it has become increasingly difficult to maintain the business using only eBay for sales. He said, "I have a real love/hate relationship with eBay. I've learned that it's extremely difficult to conduct business in circumstances where the rules are always changing."
The Problem with eBay Policy Changes
Citing specific examples of eBay policy changes over the past year that had a direct effect on his business, Husvar said that many sellers, including some of the biggest PowerSellers on eBay, are seeing their feedback ratings go down, even though they haven't changed the way they do business to warrant the drop. When, earlier this year, eBay decided to count neutral feedback as a negative one instead of a zero, Husvar saw his own score lower from 99 percent positive to 97.3 percent. While that may not seem like a significant decrease, Husvar said his sales dropped as a direct effect of this change. (Following eBay Live, the company reversed its position on this and no longer counts neutral feedback as negative.)
Husvar thinks that the Detailed Seller Ratings system involves too much math for the average consumer to understand. Seasoned buyers who suddenly see that several of their favorite sellers have decreased feedback scores will get it, but he said, for your average eBay shopper, these decreasing numbers show that a near-perfect seller is now only a good seller even though the seller's way of conducting business is still near-perfect.
Husvar says the DSR changes also mean that achieving PowerSeller status to obtain fee discounts is now near impossible. One area of concern for Husvar is the shipping score in his DSR. "My shipping is at 4.7, which I am very happy with. The problem is going to come in when buyers, who usually do not have as good of an understanding of how shipping really works, downgrade me because of shipping costs. Many consumers don't realize that shipping a 250-pound engine from Ohio to California just can't be done for fifty dollars." While the eBay buyer may like the overall price, they can still choose to rate a seller lower due to the expense of the shipping.
In an attempt to keep buyer's shipping costs lower, and also to increase his overall customer service, Husvar said it is not uncommon for he and his partner, Marisa Torres, to jump into their own Jeep and drive all over the Eastern U.S. to deliver parts. "We do deliver a lot of our own freight, simply because this saves our customers money." Even after paying the couple a set fee, which is enough to cover their own fuel and accommodation costs, TunerJunkyard.com customers can save hundreds of dollars on their purchase when they don't have to pay freight charges to a shipping carrier.
Overall, Husvar said that trying to keep up with the many ways in which eBay has been changing how sellers are presented on the auction site has made running an eBay business a challenge that is not easily overcome. TunerJunkyard.com is also expecting to be impacted somewhat next week when eBay rolls out Best Match as the default search on eBay Motors. Husvar sees Best Match as something that will handicap a lot of sellers.
"The product I sell is unique enough that I believe that I will continue to do well in Best Match searches, but with the burden of so many changes being put on sellers, this is just another issue that hinders your ability to keep things 'business as usual' on eBay."
The Solution: Mix it Up With Wigix
When you invest your savings and livelihood in starting a business, external issues, such as eBay's policy changes and the way it now presents sellers to buyers, makes doing business difficult for sellers like TunerJunkyard.com. Husvar said his niche business started without any lofty goals, but it grew so quickly on eBay, he and his partner decided it was worthwhile to invest over $50,000 in the business. While policy changes at eBay have made things more difficult for the duo, they have not decided to leave eBay, but rather look at other alternatives as a way to increase their online exposure and sales.
TunerJunkyard.com first considered investing in and setting up their own auction service for their own product, along with merchandise from other related businesses they refer customers to. Husvar said he felt that this route would involve too much technical work on his part, and was not the ideal situation for the company. "We looked at a number of alternative selling sites but felt none were big enough. Even craigslist was unsuitable for our business, despite the traffic it gets."
During his search for a selling channel to use in conjunction with eBay, Husvar heard about Wigix, a startup online marketplace launched by CEO James Chong, formerly in charge of Charles Schwab's online trading platform, that uses a price-matching system similar to that of Nasdaq. At Wigix, buyers and sellers list desired prices for merchandise and the system will alert them when they match up. Or, buyers can offer an alternative price, with both parties having the option to accept or reject the bid.
After some investigation, Husvar decided this newly-launched platform would serve well as their secondary selling channel. Even though Wigix is not expected to be out of the testing phase until October, Husvar and other eBay sellers are taking a chance that this financially backed and well-developed platform will provide a much needed boost their online eBay businesses.
The Benefits of Using Wigix
After contacting Wigix, Husvar said he realized that this company offered services and tools that eBay could not offer. "Wigix customer service is excellent and they are in a position where they can assist sellers, regardless of their need. For my own listings I required some very specific categories and they had no problem with working one-on-one to meet my needs."
TunerJunkyard.com currently pays out about 15 percent of its revenues in eBay and PayPal fees, compared to just two percent on Wigix. What eBay does offer that other sites cannot, however, is high shopper traffic. Because of the niche category of TunerJunkyard.com, Husvar said that his company, through its own Web site, which is being developed now, and their highly visible MySpace profile, will be able to direct their own customers and traffic to where they need it. While unsure about what the future holds in terms of casual browsers and buyer traffic from Wigix itself, Husvar is pleased to see Wigix leveraging social networking avenues to accelerate its growth.
While there is no plans for TunerJunkyard.com to leave eBay as a seller, Husvar will also be using the TunerJunkyard.com Web site as well as the Wigix platform to boost online sales.
Overall, Husvar likens his online selling experience to playing the stock market. "You have to look at the overall investment, and most people who claim to know such things will tell you not to put all your investment into one stock. That's the road too that we are going to take with TunerJunkyard.com; we're going to spread it out a bit, and consider the more viable selling channels, like Wigix, rather than leaving all of our stock in eBay, so to speak."
Vangie Beal is a seasoned online marketplace seller, frequent contributor to ECommerce-Guide.com and avid online bargain hunter. She is also managing editor of Webopedia.com.