How To Dropship On eBay

How to Make Money on Ebay by Dropshipping

I presume, as you’re reading this article, that you are either already dropshipping on eBay and looking for how-to tips or thinking along the lines of how to dropship on eBay. If you don’t know what dropshipping is, see my article, What is drop shipping?

• Dropshipping on eBay, in principal, is a viable way for sellers to make money on auction and classified sites such as eBay, ebid, Craigslist, etc.
• Essentially you’re acting as a retail outlet for a manufacturer or wholesaler who offers a dropship facility.
• Make sure the numbers work for the products you’re interested in selling. Be careful about your net profit calculations and remember to include your eBay and PayPal fees, as well as the total price you have to pay to the dropship company. Also, don’t forget you will have to pay taxes on your profits.
• Research eBay completed listings to see what’s selling well and at what prices.
• Research eBay Pulse to see the most popular search terms by category. Also see eBays Most Watched items by category.
• Keep a close eye on how many items a supplier has. If you sell an out of stock item, the shipment will be delayed and your customer will not be very happy with you. That leads to negative feedback and hence fewer sales.
• Plan your finances carefully on new PayPal accounts because PayPal freezes funds for up to 21 days until the item is received by the buyer.

Well this is my eBay experience and research relating to dropshipping on eBay. I hope it helps you.

Ebay Dropshipping Lists

When you’ve decided on the types of products in which you’re interested, you can start looking for appropriate dropship companies.

There is no need to pay for any eBay dropshipping lists from other ebay users. You are just wasting your money. All the information you will need to dropship on eBay can be found using the search engines. Just be careful and use a little common sense.

Finding Products to Sell

Search for, ‘dropshipping suppliers’, ‘wholesale suppliers’, ‘wholesale drop shipping companies’ into Google to see what’s available. Choosing suppliers that are in the same country as your intended customers will make shipping easier. You can qualify the search with a location if necessary, i.e., UK, USA, Australia, China, etc.

Scam alert!

The first few pages of your search results will be sites enticing you to make money selling on eBay using their dropshipping products and services. All you have to do is pay them a monthly/annual fee.

It’s okay, it’s only £100 per year and it will pay for itself in the first few sales. Don’t’ worry, this must be right, it says so right on their squeeze page!

Their maths “proof” goes something like this.

You sell an item with a RRP (Recommended Retail Price) of £25. They charge you £14.25 for the item plus £4.75 P&P (total = £20). This gives you a profit of £5 for each item sold. (Notice they don’t mention your costs, such as eBay and PayPal fees). Sell just 100 items and you’ve made a £500 killing. All for just placing an ad on eBay!

Never going to happen!

In theory this is great, in practice it’s never going to happen. Before trying to sell any products and especially before signing any contracts, do one very simple thing, search eBay and Amazon for the products you were thinking of selling.

Your research will show that nothing sells for the RRP. You will find lots of eBayers and probably Amazon, selling the same items at lower prices than your proposed dropship supplier is selling them to you.

Place such dropshippers in the AVOID list. They are only ‘middle-men’ to real dropshippers. Quoting RRP prices and making the margins look better is their way of enticing you in.

Fly-by-night dropshipping sites are coming and going all the time. When one disappears, ten more take it’s place. Be very, very careful who you work with!

What Not to Sell

Search eBay for any high tech item. Now try and find a dropshipping company who can supply the items (probably from China). What are the profit margins? Well, I’ll save you the trouble, the profit margins are generally really low to zero. You will not make money selling high tech items using dropshipping. So stay away from, video games, memory sticks, mobile phones, iPads, etc.

“But, people are making profits selling these items”, I hear you say. The reason why other sellers are making a profit on these items is because they bought their items wholesale and unless there is a very high markup, you cannot compete using a dropshipper.

Dropshipping is Not a Get-rich-quick Scheme

By now I hope you understand that dropshipping is not a get-rich-quick scheme. However, despite the fly-by-night cowboys trying to rip you off, dropshipping can be a real way to make money.

• The secret? Hard work and due diligence (sorry).

With dropshipping, just like getting your business online, you need to find something which interests you. Find a niche you like and sell to that niche. This way, you will have less competition and more profits. Selling car stickers, engine components, candles, customised knitwear or doggy clothes, will be far more lucrative than trying to sell dodgy iPads from Taiwan.

Real Dropship Suppliers

Once again, search for, ‘dropshipping suppliers’, ‘wholesale suppliers’, ‘wholesale drop shipping companies’ in your favourite search engine to see what’s available. Choosing suppliers that are in the same country as your intended customers will make shipping easier. You can qualify the search with a location if necessary, i.e., UK, USA, Australia, China, etc.

• Real dropshipping companies will require you to verify who you are before accepting you as a client. This is a good thing. Don’t try to rush a supplier into setting up your account. Most take a least a couple of days and some can take a couple of weeks, depending upon the time of year. In busy seasons, such as July, it can take longer.
• With those dropshipping companies charging excessive fees, walk away.
• Some companies, both dropshipping and wholesale, do charge a small fee for registration and some like SaleHoo charge a fee for the online ecommerce store they set-up for you.

Remember, real companies do want to make money from selling their goods. If you can do this for them they will welcome you as a client.

Try finding small, niche companies who are willing to dropship. Try things like health and beauty, designer household goods, handmade toys, customised scented soaps, works of art. This may be harder work, but how much competition have you got?

How to Dropship on Ebay Conclusion

If there’s one thing to learn from this article, How to Dropship on Ebay, it’s that trading via a dropshipper will never be as profitable or competitive as buying wholesale. If you want to make it big on eBay, buy wholesale.

Secondly, stick to whatever interests you personally. Find a niche you like, with or without the profit incentive. Your own experience will tell you what’s a good product. If you think it’s good, chances are others will as well. Now all you have to do is make a profit selling it.

Thirdly. Dropshipping requires very careful research of products, suppliers and the intended niche. Remember, you are wholly dependent on the supplier shipping the right goods at the right time but you are also wholly responsible when things go wrong.

• If any dropshipper asks for money upfront – walk away.

You might like to read my article, Recommended Dropshipping Wholesale Suppliers, Distributors, Wholesale Liquidators, next.