The Closing Ratio (CR) gives sales persons an indication of how well they are doing. It also provides an entrepreneur with data that allows them to compare their results with the results of their peers. Depending on the dynamics, the Closing Ratio can also give an indication of what areas need improvement.

Closing Ratio information provides important market intelligence for anyone who wants to engage in or to start and develop their online auctions business on eBay. In online auctions including eBay, the Closing Ratio is determined by dividing the number of successful auctions by the number of auction listings. In other words the number of items actually sold divided by the number of items which were offered for sale.

To determine the Closing Ratio for any category you are interested in:
simply view the going, going, gone pages on eBay for that particular Category;
count the number of listings on the pages;
deduct auctions with a reserve; and
divide the resulting number by the number of auctions that have successfully closed;

Let us re-capitulate:

No of going, going, gone auction items for Category you are interested in. Let's assume 1,000;
Minus Auctions with a Reserve Price. Let's say 100;
Nett No. of Items Listed For Sale is therefore calculated at 900;
No. of Items Actually Sold for that Categor, let's say 800;
Divide Result in Step 4 by Result in Step 3 i.e. 800/900;

Therefore, based on the above example data, the resulting Closing Ratio = 88.89%

In a nutshell, this means that out of every 10 items listed in the chosen Category, 9 items (88.89%) were sold. Obviously, the higher the Closing Ratio the better possibility you have of selling your items. You should, however, realize that the CR may change (go up or down) depending on the time of year and changes in tastes and fashion, effects of consumer advertising.

In choosing What to Sell on eBay you have a number of options. In the final analysis the final choice is yours. However, you can maximise your returns by following a few basic steps:

Firstly Identify Your Target Market for example, families with children, families without children or 2 income families (probably more disposable income to buy luxury items such as digital cameras), working mothers, children, anglers (fishermen), sports fanatics by category of sport, keep-fit fanatics etc.

Choose Your Product Option (s) From the List Below - Once you have decided on your target market or markets you must then decide which option or options you will adopt:

Option 1 - Focus your efforts on any special expertise or interest you may have in a particular field such as antiques, rare coins and stamps;
Option 2 - Sell consumer products of any description with special focus on market trends i.e. hot-selling items and accessories e.g. computers and printers, matching handbags and gloves for shoes;
Option 3 - Focus on items with a high Closing Ratio say anything with a CR of 80% or more;
Option 4 - Sell a judicious mixture of items in all three Categories i.e. antiques, hot-selling consumables and any category with a CR of 80% or more;
Option 5 Create your own product that you can sell yourself and keep 100% of the profit. For examole there is almost always a huge demand for information and "How To" products;
Do some brainstorming spend some quiet time thinking about your professional and other training. Is there some skill or expertise you have that someone might pay for?
Do some brain-writing make a list of 5-10 things you are good at and for which someone might pay for;
Prepare a short report or summary and test-market it on eBay for say $1.00.

Experiment.

IMPORTANT NOTE:The information presented herein represents the experience and views of the Author with the subject matter at the time of publication. No warranties are made whatsoever about the amount of money, if any, that the reader will earn from following the steps described in this Article and the reader is encouraged to seek competent legal and accounting advice before engaging in any business activity.