Pizza ops shop for equipment on eBay
When Randy Will, owner of Nevole's Pizza in Draper, Utah, planned to open his new shop, he needed seats. His wife suggested they look for them on eBay, a thought that never occurred to him.
 
"My wife had the idea to use church pews and build our own tables. That way, we could make them as long or as short as we wanted," Will said. "My question was, 'Where the heck are you going to find church pews?' She looked at me and said, 'eBay. You can find anything on eBay.'"
 
The Wills are part of a growing number of foodservice operators using eBay to buy and sell equipment. At any given time, there are more than 26,000 Food Service & Retail category items available on eBay from United States sellers alone.
 
A few years ago,

What's Important

A growing number of operators are finding used equipment bargains at online auction sites like eBay.

The volume of restaurant equipment sold second hand online is soaring, and it likely will continue to grow as operators become more familiar with the purchasing process.

Despite all the bargains available, buyers should shop carefully. Experts advise that buyers look for warrantied products, as well as sellers with good reputations.

when eBay executives noticed users were buying big-ticket items such as restaurant supplies on its auction site, they suspected those buyers were small-business owners. Their hunch proved true in a big way in 2003, when eBay estimated small-business owners bought $2 billion worth of merchandise from its site in 2003, double the amount from 2002. That number jumped to $3.3 billion in 2004. One of the sub-categories showing the most rapid growth has taken place in capital equipment sales in eBay's Food Service & Retail category.
 
"The way that the world is going, sellers need to explore all the opportunities to increase their reach to new customers," said Daniel Leffel, eBay Business category manager. "eBay allows you to reach outside local markets in a way that wasn't possible before the advent of the Internet. Maximizing the number of customers is just good business."
 
Nevole's church pews were the first of many restaurant hardware purchases the Wills have made since opening in 2002.
 
"On that first transaction alone, we saved a ton of money as compared to buying booths from a regular supplier," Will said. "We easily paid 10 cents on the dollar."
 
They saved even more buying icemaker and exhaust hoods. According to eBay, top-selling equipment brands that flow through the site include Bunn, Hobart, La Marzocco, Manitowac, Nurit, Perlick, Rancilio, Taylor, True and Verifone. Ovens are among the hottest sellers. In April 2006, more than 320 were sold on eBay with average selling prices ranging from approximately $900 to $1,700.
 
"On eBay, chances are if you need it you'll find it," Will said. And, equally important, he's not had any problems with quality, though he warns all buyers to be careful.
 
"You have to be cautious because you can't see it or touch it," he said. "But if you know what you're getting, say, a Blodgett deck oven, and know the model you're getting, then you should be okay. No surprises."
 
Fash Ashvadi, founder of PizzaOvens.com, cautioned Internet buyers to ensure they're buying from reputable sources.
 
"Don't by from somebody you don't know," said Ashvadi, who logged many years as a pizza chain owner before opening his new and used restaurant equipment dealership. "With eBay, you could be getting something that appears to be a bargain, but you end up with more of headache. Every piece of equipment that leaves our warehouse is under warranty."
 
Warranties are often hard to come by with online auctions, and those companies that do provide them will ask for a premium in the deal. Wills believes it's best to be safe and pay for the guarantee.
 
"Sometimes having a warranty depends on if a seller has a store and he offers a manufacturer's warranty," Will said. "But it all depends on the item and the seller. For those items not under warranty, you just take a chance. So far I've been one of the lucky ones; my equipment wasn't covered when I purchased it, but it's still running strong more than four-and-a-half years later."
 
eBay takes measures to keep the marketplace safe, according to Leffel. The Web site's customer feedback system can break a seller's reputation if he gets bad reviews.
 
"You can't live as a seller without a positive feedback rating," Leffel said. "We also staff a large trust and safety organization that's led by former law enforcement officials who work closely with authorities to keep the marketplace safe."
 
Buyer demographics
 
Food Service & Retail buyers tend to own smaller independent restaurants and retail establishments. Some are concessions operators or run cafeterias, hotels, office kitchens, and multiunit restaurants.
 
Sellers tend to include new and used equipment dealers, equipment auctioneers and individual foodservice and retail locations. Most often, used equipment comes to the marketplace after store closures or during remodels, and typically from chain restaurants. New equipment tends to be posted via normal distributor or OEM channel relationships.
 
Demonstrating a commitment to accelerating trade in its fast-growing

The eBay Equalizer

 

In the first quarter of 2006, the following sold daily on the eBay.com (U.S.) Food Service & Retail Category:

* 473 commercial kitchen equipment items including ovens, grills, broilers, smokers and fryers.

* 333 tabletop and serving items.

* 199 signs and menu boards.

* 118 credit card terminals.

* 120 display cases and racks.

capital equipment categories, eBay introduced a number of enhancements in 2005 that make its Business & Industrial categories easier to use and more cost effective for equipment dealers and buyers. Improvements include simplified pricing, seller assistance, and "Best Offer" online negotiation tools.
 
"We try to make it very easy to sell," Leffel said. "One way is to access eBay Marketplace Research on particular items, which enables you to be smart as a seller. You can look up what these things are selling for, and at what sell-through rates they're having. It's a great way for a seller to determine what to sell."
 
eBay Offshoots
 
Although eBay is the best known online bidding site, it isn't the only Web retailer servicing the foodservice segment. PizzaOvens.com, Pizza Equipment Supply (pesi.us) RestaurantEquipment.net, Storemakers.com, FoodEquipmentUnlimited.com and TheAdvantageGroup.com offer straight online sales, auctions or both.
 
If you're selling rather than buying, but you don't know how to do it online, eBay now has a fast-growing bricks-and-mortar support system with drop-off stores popping up all over. Practically anything can be dropped off at locations such as Pasadena, Calif.-based i Sold It LLC, the nation's No. 1 eBay seller with more than 150 stores. Such merchants will take photos, write descriptions, answer questions from potential buyers, handle payments and ship merchandise.
 
Sales commissions at drop-off stores typically run around 30 percent. For would-be sellers skittish about the do-it-yourself process, an online tutorial is available, as is advice from eBay trading assistants.
 
Whatever the mode and pace of doing business online, Will advises to use common sense and to shop around when buying.
 
"Don't go with the first thing that jumps out at you," he said. "Know your prices and know about the equipment you're getting. And don't be surprised when you can get something really good for a really good price."

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