We don’t suggest using eBay to drop ship for several reasons
- “Out of Stock” = Bad Feedback on eBay - Your suppliers can and will run out of stock on popular items. So when one of your customers buy something on eBay through you and you find out that your supplier is out of stock then you have to tell the customer and they usually write you bad feedback on eBay. This can happen with suppliers regardless, but if your customers put bad feedback on eBay about you other customers won’t want to buy from you.
- Paypal Holds Your Customer’s Payment for 21 Days - eBay and Paypal have a policy where they HOLD the payment your customer makes for 21 days or until your customer leaves you positive feedback to make sure that your customer isn’t dissatisfied with the product/ your customer service. This takes away one of the most appealing things about drop shipping - using your customer’s payment to cover shipping costs to your supplier.
- Your Suppliers Are Your Competition - Suppliers from China (they could be some of your own suppliers) are a big part of your competition on eBay. Essentially, if you have suppliers in China you’re paying them to ship their products to your eBay customers, but they (your China suppliers) are selling to your eBay customers, too. Also, they are selling the same item for cheaper because they get them at wholesale prices. This is one of the many reasons that DSL suggests not using suppliers from China.
- Your Profit Margins are Below $0 on eBay - This is because as a drop shipper you usually can’t get items for wholesale prices because you are not buying in bulk. Usually you have to pay your supplier more for the same item that’s on already eBay at a lower price because that existing item is from a supplier who is paying wholesale prices. Consumers go to eBay to get a deal and even if you can’t sell an item at the lowest price there are thousands of other sellers on eBay who can do that.
- eBay and drop shipping don’t work together - Consumers go to eBay to find the best possible deal. Drop Shippers try to get the best price from their suppliers and this is usually the highest possible wholesale price. So since there are countless suppliers already selling directly to customers on eBay, these customers will always buy the lowest priced items from suppliers.
*** Drop shipping CAN work on eBay if you have built a good relationship with your suppliers and have shown them that you can move their products in bulk. By doing this some suppliers might give you true wholesale prices, but this usually takes a long time.