I've been buying and selling on ebay for about four years now. I'll cover buying and selling separately as I think the advantages and disadvantages are different for each.

Buying:

Ebay is often not the cheapest place to buy things especially new things. Ebaytakes over 10% off sellers and so they of course have to factor this into what they charge for their goods. Obviously compared to the high street things are still usually better value but you can often find things on another website for a better price.

For second hand items you can find pretty much anything you want on ebay and this is it's huge advantage. I'll give you an example - I bought some curtains from Next in the sale and then decided I was desperate for the matching cushions and of course soon enough, they turned up on Ebay- there were probably a few people out there who were also looking for the same thing though and so I didn't get them super cheap but I got them.

The postage cost is a high percentage of a low value item especially if it's something big or bulky. Pick up only is good and you can often pick up a real bargain because obviously this limits the number of people who can bid. For things like Clothes, if you want a bargain you may be as well trying car boot sales and charity shops (to avoid the postage) but as I've said before if there's something specific you're looking for, you're bound to find it on ebay.

Look for things which aren't promoted very well and you can pick up a real bargain!

Selling:

The main downside is that Ebaytake at least 10% off you for selling - listing fees and final selling fees. It is also strange and difficult to predict what does and doesn't sell and how much it sells for. Things you often expect to do well don't and vice versa!