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The internet offers a truly amazing opportunity. A huge global market where buying never sleeps and spending grows year on year. It's never to late to profit from a market opportunity that is continually expanding.

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With the explosion of online auctions and classifieds in the past decade, people have been increasingly jumping on the bandwagon, hoping to get their piece of the Internet pie. Who hasn't dreamed of making money while sitting at home in their gitch?

On paper, selling products online on services such as eBay seems like a fairly easy endeavour. And it is, if you just want to get rid of this or that. It is a fantastic place to buy and sell niche products, like old toys, music and film paraphernalia.

If you like to dabble, then there are just a few things that you can glean form this article. If you want to get serious about selling online, however, whether it be as a business itself or as supplement to your brick-and-mortar business, then researching a simple business model is the best way to prepare.

Your Business Model

If you are thinking of starting a small side business in online auctioning, then you should start with building a basic business model. This exercise will take you through the steps needed to move ahead in an organized manner. It may also serve to illuminate any holes in your plan that you need to research more fully.

Your simple business model should have four basic parts: product research, marketing strategy, budget and expected return on investment. If you already have a product in mind, ask yourself the following questions: Do you have a supplier? Is there currently a market for your product (i.e. will people buy it, or is the market already saturated)?

There are two ways to research how your product will do in the online auction environment: take a look at who is selling similar product and how well they are moving it (this will also give you an idea of what the product is selling for so you can research what kind of profit margin is realistic) or place your product online in small quantities and see how it sells.

If you don't yet know what you want to sell, there are ways to generate ideas. One great source for ideas is to watch what is up-and-coming in the entertainment industry. The film industry especially is currently caught up in a wave of nostalgia for all things 70s and 80s, especially when it comes to action movies.

Instead of developing new ideas for movies, they are simply exploiting the nostalgia of the ticket-buying public to resurrect old ideas (old comic book heroes and cartoon classic, for instance).

Pair this with the fact that Internet buzz about movies now begins in the production phase, and you can keep on the cusp of what is about to explode. A great example of this in current cinema is the Transformers movie.

Buzz about this film, along with leaked early test shots and trailers started at least a year before the film was released. Collecting and marketing "classic" Transformer t-shirts, iron-on patches, and the originally packaged toys when the buzz began would have gotten a jump on studio merchandising for the “true” fans.

Other ways to catch trends early is to read consumer and business magazines. There are also several Web sites that detail up-and-coming trends. Keep a notebook on you to keep track of ideas that you encounter in your daily life.

The next step to your business plan is your marketing plan. The first place to look is on the site where you intend to sell. Check out the Web sites or product pages of successful sellers, both those who will be in direct competition with you, and those who will not.

When you are initially testing the market with your product, fool around with layout, different texts and images. Take from other sites what you think are effective layouts and see if they work for your target market.

With sites like eBay, you will be in contact with your buyers. Ask them directly if there is anything about the page layout that they saw that they found confusing or annoying so you know for future attempts. Ask them what they liked.

One marketing strategy that is integral to success on a site like eBay, not just to get bids, but, according to a recent study by economics researchers at the Universities of Bon and Aachen, to raise final sales prices, is buyer feedback.

According to the study, for every 1 per cent you raise your positive feedback score, the final bid price on your product goes up 4 per cent. This means that it is imperative for marketing purposes that you get your product out quickly, that you do not misrepresent your product, and that you communicate with your buyer to make sure they are satisfied.

As far as budget planning goes, do not go crazy buying up a product until you have tested its demand online. You have to keep storage in mind, as you don't want to be stuck with a huge lot of unwanted goods. Once you are fairly confident that you can predict your profit margin, then look into buying more product at bulk prices.

In order to keep profit margins large, there are a few tips to buying discounted materials. If you are looking for certain niche items, then thrift stores and garage sales are great places to shop. Both places are trying to unload unwanted or donated materials.

Another strategy, providing you have storage space, is to buy seasonal product at the end of a season, for example, bathing suits at the end of summer for the winter holiday demand, or buying Christmas, Halloween, or other holidays goods at the end of the season. You can often get up to 80 per cent off some of these items.

Just make sure that they are not so trendy that they will be obviously "last year" when the season rolls around again.

If you do a bit of preliminary research and experimentation, then you will be best equipped to estimate the expected return on your investment. You may have to try a few different products and approaches before you can expand and put money back into your business (say, by creating a Web site of your own so people can buy directly from you).

Like any business endeavour, the most successful online sellers are those who do some research, take some risks, and are stubborn enough to stick it out and keep trying to fix what is broken. A little luck never hurt either.