There is no easier way to get started in online trading than setting up an eBay account. You can be up and running in a few hours and once you get into the way the system works, it’s quite quick and easy to get you products listed.

On the other hand setting up an ecommerce website seems to be fraught with problems and the short term costs are much higher. So what is the answer? Which is the best to go for, and what are the benefits and disavantages of each?

Based on my experience of working with both types of online business models, I’ve come up with the pros and cons of each type of system:

eBay trading benefits

It is very easy to set up
You don’t need to worry about taking credit cards as it is fully intergrated with Paypal
The more you trade on eBay the better it gets. You can develop an eBay shop and if you sell enough, with good rating you will awarded Power Seller status
You don’t need to worry about marketing for your products, eBay does this for you. Millions of people are constantly searching and it won’t be long before some of them are looking at your product. Also eBay runs major advertising campaigns on the search engines
eBay disadvantages

The cost of selling can start to add up
Sometimes products may not have enough bidders and so your overall profit may be reduced
You have to work within the eBay system
You are reliant of eBay
Ecommerce website benefits

You have complete control over how your products are displayed and sold
In the longer term your cost of sale may be lower than eBay (I have found this with clients)
You have control over how the online marketing takes place
You sell all products at a fixed price
You can quickly add and remove products
Ecommerce website disavantages

The initial cost will be higher (but may become cheaper in the long run)
Building and developing an ecommerce website is time consuming and difficult (no matter what web design companies tell you!)
You need to set up a payment system
You are responsible for hosting and management of the site
From working with many clients over the years I have found the best solution is to have both. It doesn’t seem to matter which you start with but they do complement each other very well. Obviously you can stock the same products on each, but one of the main benfits I’ve found is you get two completly seperate streams of buyers, that don’t seem to complete with each other.