OpenBazaar for Sellers: The eBay Alternative with No Fees
- How to follow a logical path through selecting the best cloud mining services in 2021? - July 15, 2021
- Staking VS other ways of earning on cryptocurrencies – what makes most sense - June 14, 2021
- Introducing SafeHamsters - May 27, 2021
Ebay can be a great way to sell your old stuff online, or for merchants to get their products in front of a large audience – but it can also be expensive. High fees can take a significant chunk out of your earnings and make it difficult for smaller sellers to generate a healthy profit.
Fortunately, there are alternatives out there with lower fees. In this article I will introduce you to something called ‘OpenBazaar’, a peer-to-peer marketplace which provides an excellent alternative to ebay for sellers by offering the best price you can get: zero fees. Yes you read that right, there are no fees whatsoever to sell your items through OpenBazaar. Although there are other services where you can list your items for free and only pay when you get a sale, I’m pretty certain that this is the only way to sell your items without paying any fees at all.
OpenBazaar is a decentralized, peer-to-peer software system. That its why it is able to operate without charging any fees – there is no company running the marketplace or hosting a website on their servers, only a network of users who connect directly to each other to buy and sell with no middleman.
In order to make this possible OpenBazaar uses Bitcoin, a decentralized payment system which itself allows direct peer-to-peer payments with no middleman. But don’t worry, if you don’t want to handle Bitcoin yourself then you don’t have to; I will explain how to get around this and receive payments in your national currency further down the page.
A Beginner’s Guide to OpenBazaar
The key difference between something like eBay or Amazon and OpenBazaar is that instead of accessing it through a website you download it and access the market straight from your device.
When you open it up for the first time there is a short and simple set up process, where users can select their language and currency, and add their own theme and profile picture if they choose.
Your device will automatically connect to other users of the network, and you can immediately start browsing for items to buy.
Because OpenBazaar connects buyers and sellers directly with no middleman, there needs to be some protection for both parties to stop scammers and fraudsters from abusing people. This is accomplished through an ‘escrow’ system in which a moderator is able to step in if there is a dispute between the buyer and seller. Through the magic of Bitcoin, this is possible without the moderator or OpenBazaar itself ever taking control of your funds and with no fees to pay unless there is a dispute. If the buyer and seller agree that everything is fine, then the payment is issued by the Bitcoin network itself, and if there is a disagreement then the moderator can investigate for a small fee paid by the buyer and then tell the Bitcoin network whether to make the payment or issue a refund. This is one of the major reasons why it is better to use Bitcoin instead of a traditional payment processor.
Direct payments that do not use a moderator at all are also possible, but users are advised to only do this if they have a very high level of trust in the person they are buying from.
Before you go any further I recommend you download the software to take a look around: https://openbazaar.org/
A more in-depth user tutorial that will guide you through browsing for products, following stores and exactly what happens when you click to make a purchase can be found here: https://blog.openbazaar.org/openbazaar-user-tutorial/
Becoming a seller on OpenBazaar
Starting your own OpenBazaar store is free and not at all difficult to do. You can do it by just clicking the ‘become a store’ button from your profile page, filling out a name and a description of your store, selecting moderators (see below) and then adding your first listing!
Registering Your Name
When your profile page is created you are automatically given a unique ID which acts as the address where people can find you. If you create a store this also becomes the address where your customers can view all of your products in one place (they can also find your products individually through the search and browse features). This address is not very convenient, however, because it just looks like a long list of random characters rather than a readable address that you can easily share.
In order to properly establish your brand and promote your business therefore, you need to register a ‘handle’. This means that people can go to your store page by simply typing in @yourhandle in the navigation bar. This process is handled, if you’ll excuse the pun, by a third-party provider called OneName who provide an internet identity system that you can also use on other websites and services.
Registering your name is quick and easy, and most importantly free. Just go here: https://www.onename.com/. Once you’ve registered your name go to ‘settings’ (the gear icon) in the top right corner, then click ‘App Accounts’. Enter the name you want to use for your store as the ‘AppName’ and then your OpenBazaar ID (you can find this in the right hand column on your OpenBazaar profile page) as the account identifier. It may take a few days after you hit that save button for the process to complete, but after that you will be able to share your store name with your customers and they will be able to easily navigate straight to your store.
Because this is a peer-to-peer network and there are no central servers, your store will only be online and available to customers as long as the computer you are running the software on is online. So trying to run a professional store by just putting the software on your laptop is obviously not a good idea. You need to run it on a computer than will stay online 24/7. There are several different options available to help you do this: you can run it on your home computer and then leave your computer on all day and night; this gives you total control but will use up electricity. You can install the software on a small and efficient computer like a raspberry pi which uses much less electricity. You can then use the Raspberry Pi as a server and still be able to access your site to manage it from any other device, but doing this can be a little bit more technically challenging than installing it on a regular computer (see the guide here: https://github.com/OpenBazaar/OpenBazaar-Server/wiki/Raspberry-Pi-Install-Raspbian). Alternatively, you can pay somebody to host your store for you; as long as you make more than just a few dollars worth of sales every month the cost of doing this is very likely to be a lot less than paying a fee on every sale to a site like eBay.
Pretty much any VPS web hosting service can be used for this, if you want to set it all up yourself. The cost will vary depending on which provider you use, but should only be a few dollars per month approximately. You can also use specialist services that have popped up to cater specifically to OpenBazaar store owners. You can actually find hosting services through the OpenBazaar software itself by doing a quick search from the navigation bar at the top or by going directly to the store page of a well known provider like @agoristhosting. You can also order from a website such as http://bitfair.io/, http://hostedbazaar.com/ or https://agoristhosting.com/openbazaar if you prefer.
When you are setting up your store, a selection of moderators will be suggested for you based on the information you provide.
These moderators perform an important function. It is vital for both your security against fraud and your reputation with customers that you select moderators who will be diligent and honest in fulfilling their role. A good place to look for moderators as well as learning more about how the process works is https://www.reddit.com/r/openbazaarmoderators
Instantly Convert Bitcoin to your National Currency
I whole-heartedly recommend that you keep at least some of the money you receive from customer purchases in Bitcoin. Its great for online shopping, for saving, and for many other things. But of course your business will almost certainly have costs to pay in your national currency, and the value of bitcoin can fluctuate compared to other currencies – which creates a risk which many business owners simply will not be willing to accept.
To get around this problem you can use a service like Coinbase’s ‘instant exchange’. Coinbase operates in many countries around the world, and by using this service you can get yourself a bitcoin address to use in OpenBazaar, but when a customer makes a purchase by sending bitcoin to this address the coins are instantly sold to Coinbase and you receive the national currency of your country instead. You can learn more about this service here: https://www.coinbase.com/instant-exchange
Promoting Your New Store!
As soon as you create your store and add products, customers will be able to find your listings when they browse or search within the app. But, of course, if you want to maximize your sales then you need to make a bit more of an effort to get your name out there and draw people in to your store.
Many of the same methods that you use to promote an eBay store can be used here – for example setting up social media profiles and posting regular updates.
But the most effective marketing will target people who already use Bitcoin and ideally who have already downloaded OpenBazaar. One way to do this is to be an active member of the community on the OB subreddit: https://www.reddit.com/r/openbazaar. Please don’t just spam them with links to your products though, because you will soon get banned. Another way to promote yourself is using ad networks that target bitcoin users; one such network that I use on this site and which takes care to respect people’s privacy is Anonymous Ads
Vendors Guide: For the full low-down on managing your listings, confirming orders and more you should really take a look at this vendor’s guide on the official OB blog.
BazaarBay: This is a website which provides a search engine for OpenBazaar. You can use it to view the top listings and top vendors at the moment, to view network stats, and to create advanced searches that you can’t do through the software itself.
Join the Community on Slack: Chat with other merchants as well as developers and enthusiasts in real time with the slack chat room.