The firms taking advantage of lockdown and making a profit on eBay

When the UK went into lockdown some entrepreneurs took advantage to set up eBay businesses from home. Many are now seeing they can continue to profit from this work coming into the ‘new normal’, writes Zlata Rodionova

Henry Cawley of UK Components (UK Components)

The coronavirus pandemic and the subsequent national lockdown have crippled businesses across the UK.

Most brick-and-mortar shops were forced to shut while consumer demand dropped, with customers struggling financially after losing jobs.

However, despite these economic uncertainties and while others were busy baking bread, some entrepreneurs took advantage of the time during  lockdown to launch a new venture or start selling their products online on eBay – and business took off.

June saw the biggest year-on-year spike in new businesses joining eBay UK, up 335 per cent compared with the same month in 2019.

Since lockdown began, sign-ups jumped an average of 256 per cent year-on-year, according to the auction website.

For some young entrepreneurs, having some downtime and being furloughed from their usual employment enabled them to create new business ventures or take their business online for the first time.

This was the case for Henry Cawley, 23, from Norfolk, who studies mechanical engineering at Bath University but was forced to move back with his parents after his degree was put on hold in March.

He used his time at home to launch UK Components – a company that sells parts for 3D printers – and sales have increased month-on-month with no signs of slowing down since. In the last week alone sales have grown by 30 per cent.

Judging by recent sales growth, the young entrepreneur predicts a yearly turnover of £40,000.

He tells The Independent: “Selling products on eBay was quite a low risk to take, all you need to do is buy a little stock. I started very small before expanding my range of products.

“Being at home just allowed me to work on my listings, do my research and see what’s selling well. When you start on eBay you also immediately have access to a very big market and you’re part of a bigger network. It helped me to scale a lot faster with very little risk. 

“I’ve still got time before I go back to university, and I’ve got loads and loads of new products to list. I’m basically using my time to make all these listings as slick as possible. Hopefully, by the time I go back I will be in a good enough position to not do any other job. I used to work night shifts at the supermarket and I’m hoping this could subsidise that income.”

Although setting up a business on eBay is relatively easy, there are fees involved.

A basic subscription usually costs £25 per month, while an anchor subscription, which offers unlimited fixed-price listings and is aimed at businesses with a bigger turnover, would set you back £399 monthly.

But during lockdown the auction website lifted the fees for small businesses.

The offer, which was originally launched on 26 March, was then extended until the end of July – a generous discount for savvy entrepreneurs considering selling fees are the second-biggest cost to businesses on eBay after shipping, amounting to 10 to 12 per cent of sales.

Starting a venture on the auction website can also represent a quick route to international trade, and UK sellers in particular are taking advantage of this opportunity.

Last year, Steve Capon, a former Dragon’s Den candidate from Brighton, won a global licensing deal for his latest invention, Matey Measure – a DIY tool that helps builders to accurately measure corners.

I think selling on eBay opened a whole other audience for us. Since the pandemic, home beauty is massive, so we’ve seen an increase of sales by 300 per cent in one week in April

Mr Capon successfully launched it on the auction website during lockdown, and the 51-year-old is now getting interest from international buyers in countries including the US, Japan, New Zealand and Australia, boosted by his appearance on BBC One’s The Customer is Always Right show in March .

“The key with any new invention is people talking about the product, and eBay is a great place because it provides you with the feedback that is crucial to my business model. Sales went off the Richter scale after my appearance on TV and I didn’t have time to keep up with packaging,” Mr Capon says.

“eBay also gives you access to a wider marketplace. I’ve just ordered 10,000 units – 2,080 are already on their way to Australia and New Zealand, 500 to Japan, and the rest will go off to the UK and the US.”

The entrepreneur is hoping the business will be profitable next year, which would allow him to quit his building career and focus solely on his invention.  “We’ve only been trading six months but we expect our yearly turnover to be close to £100,000. This has all been done without borrowing money or taking any loans from the government.”

While some companies have used eBay to launch or test their products, others who were already selling online have taken advantage of the pandemic to expand their online presence.

Claire Parkes, from Wolverhampton, is part of the team at Bluesky Cosmetics, which started on eBay during lockdown as a way to get their products to the market after their plans to open pop-up stores were paused.

Ms Parkes tells The Independent: “Our pop-up store in Birmingham, which ran from October 2019 to 2020, was extremely successful, so our growth strategy was to open more shops across the UK this Christmas but obviously Covid hit and we had to change our plans. We started exploring online channels and eBay was one of them.“

As consumers missed their manicure treatments and salon visits, they turned to at-home beauty treatments, which boosted sales for companies like Bluesky Cosmetics.

The company sells gel polish and nail extension but their most popular product has been a starter kit, which gives customers everything they need to recreate the salon experience at home, including a lamp, a base coat and a top coat as well as three different gel polish colours.

Ms Parkes says: “I think selling on eBay opened a whole other audience for us. Since the pandemic, home beauty is massive, so we’ve seen an increase of sales by 300 per cent in one week in April. In August, things have started to level up but we have now gained a huge customer following.”

A recent survey by the Chartered Institute of Personnel and Development and recruiter Adecco found one in three UK employers expect to make staff redundant between July and September.

But Ms Parkes says Bluesky Cosmetics has just hired a new member of staff and is looking at recruitment across the board. “We just haven’t had time up until now to stop and recruit,” she explains.

“We’re exhausted but the pandemic has been fantastic for our business. It forced us to move a little bit faster in some areas, but that speed has got us where we are now. It’s mad to think that we managed to do that with a small team of eight – the kind of progress we've made as a business in six months has been phenomenal.

“Now we just need to see what 2021 brings and whether we could start looking at opening stores again – but we’re not in a hurry. Since we’ve had such an increased online awareness, some retailers already approach us about stocking our product.”