What Is EBay Dropshipping?

Dropshipping on eBay involves selling items on eBay and then working with your supplier to directly ship them to customers. Instead of manufacturing products or holding inventory, you – as the seller – focus on marketing activities, customer service, and finding potential products to sell.

To start your own dropshipping business on eBay, you need to find products, source them from a trustworthy supplier, and list your items on eBay. Many sellers use the exact images, product titles, and descriptions provided by their suppliers. When a customer purchases from your eBay listing, the details will be passed along to the supplier, who is then responsible for shipping the product to the customer.

Your profit comes from buying products at a wholesale price and then reselling them at a higher price.

What Is The Procedure For EBay Drop Shipping?

Is eBay allowing dropshipping? Yes. However, there are certain limitations.

This is done to maintain its reputation as a risk-free marketplace. Facebook has every right to do so, given that it now has 185 million active users all around the world.

If you are unfamiliar with eBay, it is a huge online auction website based in the United States. Buyers can search, bid on, and purchase things that sellers have posted with a starting bid. To manage the price and allow customers to purchase without bidding, sellers can provide a “Buy It Now” option. Dropshipping on eBay necessitates large purchases from a wholesaler and the use of a fulfilment service to store and ship products on your behalf. Anyone with an eBay seller account can begin dropshipping. Its obligations, on the other hand, make things slightly more complicated than standard drop shipping. Let’s have a look at the following segment!

Ebay Drop Shipping Policies:

Dropshipping is theoretically permitted on eBay if you “fulfil orders directly from a wholesale provider,” as we previously stated. This means that if you buy in quantity from a wholesaler, you can market those items on eBay.

Keep in mind, however, that purchasing things from another store or marketplace and having them shipped directly to your customer is not permitted. So you can’t sell something on eBay, buy it from Amazon, and then ship it to an eBay buyer. Receiving an Amazon box in the mail is not only confusing for the customer, but it also means they can’t track their shipment.

It’s crucial to understand that you can still use Amazon FBA to fulfil eBay orders. Instead of purchasing the items on Amazon’s marketplace, you will use their fulfilment services.

Furthermore, you are still responsible for the safe delivery of the product within the time range mentioned in your ad, as well as the customer’s overall pleasure with their purchase if you use drop shipping.

EBay is adamant about this regulation, warning that your listings will be removed or lowered in their search results. They may even downgrade your rating or status on the platform if you’ve been selling for a long period.

How Much Does It Cost To Dropship On EBay?

When you dropship on eBay, you’ll have to pay eBay’s fees for using their marketplace as well as your suppliers’ expenses. The following are the most common dropshipping fees on eBay:

• Insertion fees (or listing fees). You’ll get 50 free per month, and beyond that, the fee for listing an item in most categories is $0.35.
• Final value fees (or selling fees). These fees are a percentage of a product’s total sales price. For most sellers, it is 10% or even lower.
• Listing upgrades. With extra upgrades like larger photos, international site visibility, and more, you’ll get more power to attract customers.
• Fees in select categories. Fees can vary in certain categories, including real estate, business and industrial items, and motor vehicles.

The two critical fees to consider are the listing fees (the cost to post your item, no matter if it sells or not), and the final value fees (calculated on the item’s final sale price).

The Advantages and Disadvantages of Drop Shipping On EBay

EBay drop shipping has a lot of advantages, especially for new sellers and start-ups, if you follow the rules. The advantages are as follows:

• No upfront investment. Perhaps the greatest benefit of eBay dropshipping is the fact that you don’t need to buy stock in large quantities upfront. You just need to find a wholesaler who is happy to dropship to your customers. And in case it is not right for you, there’s little to lose other than your time.
• Easy to get started. As you don’t need to invest in inventory, it’s quite easy to get started with almost no money at all. There is no need to face the hassle and costs of setting up your own online store or E-commerce blog. All you need to do is create an eBay seller account and find a wholesaler to dropship on your behalf.
• Take advantage of eBay’s audience. EBay is one of the largest and most well-known auction sites for buying goods online, meaning it already has a huge and loyal customer base. By starting your eBay drop shipping business, you will essentially gain access to a vast audience with zero work from your side.
• Save on marketing efforts. As well as capitalizing on a huge ready-made customer base, eBay dropshipping means that you don’t need to spend loads on marketing; millions of online customers will see your listings anyway.

Dropshipping on eBay appears to be a no-brainer on the surface, but there are a number of drawbacks to consider before doing so, especially since eBay implemented its rigorous drop shipping policy. The following are the disadvantages:

• Listing fees. EBay charges a fee per listing (the first 50 listings are free) as well as 10% of your total sale price. With the already-slim profit margins via drop shipping, these fees can add up quickly.
• Less customization. Dropshipping on eBay can be a great way to start an online business, but fewer customization options for your store and listings can make it difficult to stand apart from your competitors.
• You’re responsible when things go wrong. You’re entirely responsible for the safe delivery of the product within the time frame stated in your listing. However, you are reliant on the supplier to dropship for you. So, in case they run out of stock and wait a month to ship, there would still be no repercussions for them at all. Meanwhile, the negative feedback you would inevitably receive could result in account suspension, not to mention a severe drop in sales.
• High competition. Owing to its low barriers to entry, eBay dropshipping is an appealing pie to lots of online sellers just like you, meaning the competition is steep. Especially when many retailers will be selling the same products as you, you’ll need to focus your efforts on others that are easy to stand out, which can be highly time-consuming.
• Low profit margins. With such fierce competition, you may need to keep lowering your prices to remain a viable option to your customers. What’s more, eBay dropshipping fees can reduce your profit margins. So, to really make money from eBay drop shipping, you’ll have to maintain a huge sales volume every month.

In the end, it’s up to you to decide where you want to focus the majority of your time and effort, but for many sellers, eBay dropshipping remains an easy and effective way to make money.

4 Steps to Start Drop Shipping On EBay:

If you still want to try dropshipping on eBay, below are 5 necessary steps for you.

Step 1. Find your suppliers:

The supplier you choose can actually make or break your dropshipping business. They are responsible for the storing and shipping of the product, so your reputation is in their hands.

When deciding which supplier to cooperate with, ask these questions to the supplier and yourself:

• Does the supplier actively support dropshipping?
• What shipping methods does the supplier offer? How long do these methods typically take?
• Do they deliver worldwide, or only to specific countries?
• How do they carry out quality assurance?
• How is their reputation? What help would they provide if there were any issues with the order?
• Can you use their source material (product photos, descriptions, specs) in your listings?

Make sure you can find a trustworthy supplier. Dropshipping on eBay is great when you get it right, but there is the potential to be scammed if you work with a dodgy supplier.

Once you have chosen your supplier(s), find their information and contact them. Remember to let them know your intention and ask about their policies on dropshipping.

Step 2. Choose your products

This step can come before or after step 1, depending on what you want your online store to be. While scrolling through items that your supplier offers, you may have some ideas of what to sell based on your own interest. With the help of eBay product research tools, you can analyze the statistics to find which items are able to make a profit on eBay.

Besides, you should request a sample order from your supplier first to make sure that you are satisfied with the quality of your future products. Nothing kills a dropshipping business on eBay faster than receiving customer complaints early on, so always keep your customers happy.

Step 3. Create your eBay seller account

It will take a few minutes to set up your own eBay seller account. But below are some important points that you should not overlook:

• Pay attention to eBay’s seller information centre, where you can find many useful links and guidelines for setting up your store.
• Choose your account name wisely. If you choose crude or offensive ones, you might drive customers away (and even violate eBay username policy). With clever or catchy names, you might get better sales.
• You may be required to provide a tax ID. You can search on Google to know how to apply for a tax ID in your state.
• Set up your own payment method. These methods may vary by country, but all US sellers are required to have either a merchant credit card account or a PayPal account.

Create your profile page with details about your store and its policies, such as shipping and return policies. Detailing your background and credentials will be useful for specific niche markets (electronics, health, make up, etc.)

Step 4. Create your product listings

Using the available information provided by your supplier, build your own product listings.
With a constant stream of loyal consumers and great business growth potential, eBay is lucrative for many first-time sellers and small businesses.
What’s more, dropshipping on eBay has recently opened the door to this enormous audience without the need for upfront capital. Requiring far less prior investment than a regular store, dropshipping on eBay could provide a great gateway to online retail for merchants just starting out or looking to test the water.

Tips for EBay Drop Shipping

To help you advance your eBay drop shipping business, we’ve compiled some tips right below.

Keep control of your pricing

Millions of online buyers flock to eBay daily in the hope of getting the best price for the products they buy. This can be a huge challenge for drop shippers, as while the final sale price may fluctuate, the supplier charges a fixed cost no matter what.

Plus, as we said, eBay listings require a listing fee and a percentage of the final sale price, which can cut into your meagre profit margins.

Thankfully, there are different ways to maintain your profits. When dropshipping on eBay, you’ll have the option to set a Buy It Now listing, which offers your item at a fixed price, so you can ensure you pull in your desired profit.

If you still want to let eBay buyers bid for your products and get a higher profit, you can try setting a reserve price as the minimum price that buyers can auction. Or, just set a high starting bid that ensures you’ll cover your fixed costs.

Make sure to factor in costs from your supplier (including taxes, shipping, etc.) as well as eBay’s listing and final value fees.

Minimize your workload

When it comes to making money with eBay dropshipping, high volume is the key to gaining a competitive advantage, as profit margins tend to be minimal, often only a few dollars per sale. As a result, high volume means more work, especially when you must process and fulfil every listing individually.

Minimize your workload when dropshipping on eBay

In order to streamline this process and reduce your workload, you should find products that can be posted as multiple-item listings. This way, you only have to make the listing once, leaving you free to take care of fulfilment and handle returns if necessary. And remember to set a longer duration for these listings to avoid the need to re-list.

Provide tractability

Most of the time, be sure that your eBay customers can track the package easily. Just share your FedEx, UPS, or USPS tracking numbers with them. You can work directly with your suppliers to have these kinds of complications.

Ensure availability

Many people choose eBay dropshipping because it eliminates the need to keep an inventory, but this can lead to some drawbacks. One of the biggest mistakes is they can’t ensure that the items they list on eBay are still available. This could drive away potential customers and create financial hardships for you.

So, to avoid the pitfalls of selling out-of-stock or discontinued items, you should check your suppliers’ inventories frequently to see what is in stock and what will leave their stores soon because of low quantities. Collecting daily reports from your suppliers can help you maintain a reputation of quick and reliable fulfilment with your customers.

Ensure fulfilment

You have made sure your listed items are available; it’s high time to keep your customers happy by quickly and efficiently fulfilling all orders. Reputation is everything when doing business, so be sure to stay on track with fulfilment.

The key point here is to find reliable suppliers. Not only will they stay on top of shopping products quickly, but they will also keep up up-to-date on the status of your orders. This lets you know of potential delays or issues, so you’re able to relay the information to your customers.

Issues can arise now and then, but keeping in contact with both your suppliers and customers will keep any potential negative feedback to a minimum.

EBay Drop Shipping Tools

Last but not least, automation software is necessary to implement tasks like finding products or fulfilling orders. So, below is a list of some helpful software that can help your eBay dropshipping business run smoothly.

• Price Fox. This tool lets you monitor the supplier’s stock and pricing. You can even edit and update your pricing right from the tool without visiting eBay.
• EASYNC. This software comes with a number of features, such as checking product availability, shipping dates, tracking prices, and more.
• Shop Master. Shop Master can do product sourcing, listing, sales management, and many more. This tool is used by more than 80,000 drop shippers.
• DSM. You can use DSM to reduce the workload of listing products on your eBay seller account, or reprice them when needed. You can take advantage of its free plan to get started.
• Blacklisted. The tool offers a keyword tool, SEO templates, photo editors, and Meta tags, which can be customized for listing on eBay.
• Dropship Beast. This is a solution helping drop shipper automate their pricing, search engine optimization, product shipping management, and many more. Pricing plans start at $30/ month.

So, Is Drop Shipping On EBay Worth It?

The answer to this question heavily depends on what you want to achieve through eBay dropshipping.

If you are just trying to make a little extra money on the side, then eBay dropshipping could be a great option, with low upfront investment and limited risk involved.

However, if you want to create a long-term, memorable brand, with healthy profit margins, and be entirely responsible for the development of your online business, then dropshipping on eBay is not for you.

We always recommend you focus your efforts and resources on finding a platform that allows for far greater customization.

We hope this guide has helped you a lot with eBay dropshipping. Contact us if you have any concerns or questions. We’re always happy to hear from you!