Making money on Craigslist. Yes it does take hustle, but as I tell folks here on my blog, it ONLY takes two other things to be in business:

Learn to use Craigslist to test market your business idea. Build a buyer’s list using Craigslist!

1) access to a thing (or thingS) of value and
2) a way to communicate to people that value that thing.

And Craigslist can provide you with both.

Genius..!

Now after having a single TRANSACTION… you find out how to lather, rinse repeat… and now you have a bona fide business.

Selling a Product on Craigslist

My teenage son really appreciates paintball.

Recently, he was able to pick up a screamin’ deal on a paintball gun on eBay.

But then a friend offered to buy it from him for more than we he had in it and an idea struck me.

“Son, list that gun for sale on Craigslist.”

“DAAAaaaad… I can’t. I promised it to my friend Christian.”

Use Craigslist to See if Your Business Idea is a Winner

Sigh. Explaining the deep intricacies of small business validation to a teen seems like a daunting task. But since you’re a follower of my blog (RIGHT? 😉 ) I’ll spell it out for you.

I didn’t want Pierce to actually SELL his gun to a stranger. I just wanted him to LIST it for sale.

Why? Well, to see if there was a potential there for a small business! They call it “validation” when you actually make a sale or two at a profit. After validating a business idea with a few transactions, you can then make the steps you took to make those few sales into a system. Then you have a business.

Now back to the paintball gun. Pierce didn’t want me to sell it out from under his friend. But that was never the plan; I simply wanted him to list it. Then when the calls came in… if indeed they did… he could very honestly say, “Sorry but that gun is sold. But I know where to get more like it for cheap. WHAT KINDS OF PAINTBALL GUNS DO YOU LIKE? WOULD YOU LIKE FOR ME TO KEEP YOU IN MIND WHEN I SEE ONE OF THOSE?”

Heh-heh. Sorry to yell at you. I just wanted to make sure you saw those two key sentences.

I learned this trick while working a real estate investor that was a GENIUS at marketing. Richard would intentionally allow a newspaper ad for a home to go on for two or three weeks AFTER he sold it. In Colorado Springs, that’s saying something because the local paper gets confiscatory prices for little-bitty ads. One day I asked him about all the money he was “wasting” not only on ads, but on me, his telephone assistant to field all the calls that were coming in on a home that was already sold.

“I’m not wasting money Kurt,” he said. “I’m doing market research.”

Then I remembered my phone script: “No, I’m sorry that home is sold. What kind of home are you looking for? What area of town?”

Richard didn’t want me gathering that information just to sell another home in his inventory as I had previously thought. He wanted to know so that’s where he would focus his future buying efforts.

Last I looked, Richard had a database of literally hundreds of people looking for a specific kind of home. Then he would put out his feelers for and find that kind of home, BUY it, and THEN he would have me start making calls.

Okay, side trip into real estate. Now back to Craigslist.

Whatever you are selling… paintball guns, cars, washer/dryers… Step One is to place an ad. Even if you don’t really have something for sale (yet)!

Step TWO is to take calls and gather as much information from your prospective buyers as they are comfortable divulging.

“Thanks for calling about my widget for sale. DO you have other widgets? Do you collect them? Should I call you if I get another widget at a comparable price? What kind of widgets do you like?”

You get the idea.

A Marketer’s Most Valuable Asset

 Hey, if you’re not careful… by following the steps above  you might end up pulling together a buyer’s list… one of the most valuable

A Buyer’s List is YOUR Key to Lasting Business Success.

assets you can possibly have as a marketer.

So many folks go about marketing the wrong way: first they make a product, or buy one… WASTING capital by acquiring unnecessary inventory and incurring expenses for storage… and THEN they go about trying to sell it.

That’s bass-ackwards! Getting all the trappings of a small business (business cards, a website, logo) is just “playing business”. Making sales is what business is all about.  So it makes sense to make the sales first, then fill in all the blanks later.

It may seem a bit surreal to make sales when you don’t even have something to sell. But as I’ve said here before, Just Because You don’t Own Something Doesn’t Mean You Can’t Sell It.

The best way to find an opportunity is to hang up a shingle… which you can do for FREE by the way on Craigslist… and see what comes back.

Keep a record of everyone that calls you, and for what. See if you can find a few products in great demand that you may also find cheaply.

Selling a Service on Craigslist

Here’s a podcast by a fella that figured this out; he discovered a Craigslist arbitrage niche. Literally overnight he established a business that pays him full-time profits. By buying used washers and dryers for cheap and selling them for a bit more, LaJuan Stoxstill-Diggs helped folks on BOTH sides of the equation.

The sellers might be moving, or getting a newer piece of equipment, and are faced with the problem of how to get rid of their appliance.

The buyers might be a new couple starting out, or a college student needing an affordable alternative to a brand new washer/dryer.

Along comes LaJuan and solves BOTH of their problems… and pocketing a nice profit.

Folks have even offered HIM money on the acquisition side… “How much do you charge to haul this dryer away?”

NICE.

Check out LaJuan’s story on my twitter pal George Meszaros’ site! This podcast is just an illustration of how ridiculously easy it is to put together a small business without any starting capital:

http://www.successharbor.com/how-to-hustle-and-turn-craigslist-into-a-business-with-lajuan-stoxstill-diggs

The Shoestring Steps, 2) Find out the W’s and 5) Now Write Everything Down are hard at work here.

 Validation: The Key to Establishing Your Small Business

Before I ever heard this technique called, “validation”, I was using it to test markets… before putting all my eggs into a basket with holes in it.

For example, waaaay before Craigslist I used The Thrifty Nickel, a newspaper filled with nothing but classified ads. The Thrifty Nickel made piles of money for me as a 19-year old… but more importantly it SAVED me money when I used it to determine if an idea was NOT in great demand. My lawn aeration biz was a screamin’ item; my apartment referral service and gift bag delivery ideas not so much.

“Validation” simply means this: BEFORE overcommitting to all the bells and whistles and trappings that normally go with running a business, try and make a few sales.  Duh. If people call to inquire, or better yet place an order, you’ve got a winner.

Sidgl Custom Computer Bags by Ben Trissel… check Facebook and now Etsy

Social media is wonderful for this; a childhood friend of mine recently set up a facebook fan page on my advice to sell his custom handmade computer bags. He’s off to the races having orders come in faster than he can fill them.

But get this: before he read my book he HAD been saying, “I need to maybe get a loan… or use my savings… to buy a bunch of leather and get a machine and make a whole buncha bags…”

WHOA! Hold up there, Ben. Here’s an important question to settle first: Do your bags suck? Will anyone actually fork over enough money to buy them… and (this is kinda important) at a profit?”

Look, as a prospective small business owner you WILL have problems. Which problem would you rather have:

1. Sitting on a huge pile of “frozen money”… inventory that you can’t even seem to give away, or
2. Sitting on a huge pile of orders… being barely (or just NOT) able to keep up with all the orders coming in?

Sign me up for door #2, please 😉

Beyond Craigslist: Other Social Media Selling

Craigslist’s Tips against getting scammed- We get it, C-list. Go local or go home.

Craigslist is good for validating and selling both products and services. The problem with it is that most folks trust local sellers, and with good reason. In their safety guide, Craigslist warns users off of buying stuff that’s not from your own ‘hood.

But there are other ways to test your biz opp for free.

Getting the word out by way of Twitter and Facebook makes sense, especially for services and information products.

You could use Etsy or eBay for physical products.

Same goes for Fiverr for services.

When you use social media to test your business idea, it makes sense to go to the ones where you already have a network. But don’t stop there. In my recent post, Validate Your Business Idea with the 3 Most Overlooked Social Media Sites I pointed out that not all social media is advertiser-unfriendly. In fact, visitors to Fiverr, eBay, and Amazon expect to be marketed to and they’re often in the mood to buy! If you don’t think of these sites as social media, check out that post and see if you agree.

Action Steps for Validating Your Business Idea

If you intend to offer your goods or services locally, Craigslist is a good start. But don’t overlook Yext, Yelp, Google+ Local, Thumbtack, and the plethora of other free and fee-based local directory ads. If your product or service is info-product, service-oriented and global in nature, try Fiverr and Amazon. But don’t overlook using LeadPages and Facebook to target customers to a squeeze page.

Here’s how to go about validating your business idea:
(translation.. here’s how you can know if you have a WINNER!)…

1. Solve your OWN problem first.
2. Write a short description of your solution that’s about your customer, not you.
3. Post that baby on anything that sits still, with a way to get in contact with you.
4. Ask every question you can think of your prospective buyers
5. Maybe sell ’em something! See IF and WHAT people will actually pay for your solution.
6. Do some math. See if you can get your product at a lower price, or deliver it with less time commitment.
7. Lather, rinse, repeat. Sell one used exercise bike on Craigslist, that’s a business transaction. But set up a system to find multiple buyers and deliver multiple exercise bikes (Craigslist or no), and that’s a real live business.

I’ll go over all seven of these steps in future posts… or maybe an information product (wink, wink) in the near future. But for starters let’s look at step ONE: Solve your OWN problem first.

Ana Hoffman’s Traffic Generation Cafe: Tips and Tricks equal HUGE amounts of traffic to your website!

My friend Ana Hoffman founded the extremely popular site, Traffic Generation Cafe by solving her own problem: she had another website that needed traffic. What she found out… and continued finding out… about how to generate free web traffic to a blog became the basis for a blog as well!

Ana’s tips and tricks for generating free traffic have led to her site having an estimated value of over a million dollars in about four years. I personally happen to think that’s undervaluing the help she has made available to bloggers and content marketers, but hey.

Check her out for yourself.

My point is this: validation is important before you invest four years of your life into something. Ana knew she had a winner early on… or she would be blogging about something else.

So validate your OWN business idea before you go getting fancy.

Okay, Steppers! Do me a favor: if you do go ahead and try using that seven-step system above to validate your business idea of Craigslist, or other free sites… and you get some valuable market intelligence that helps you make some real ca$h… rather than sending me half of your profits 😉 just leave me a comment below. Thanks!

Keep Stepping,

Kurt