How to Start Dropshipping on eBay
Have you heard about dropshipping and wondered how to dropship on eBay?
Want to know how it all works and whether it’s something you could do to start making some extra money?
Well this article will tell you how dropshipping on eBay works step by step, how you can start dropshipping on eBay with no money, how to find products and suppliers to dropship on eBay as well as some of the pitfalls to watch out for along the way.
Let’s get started.
How Does Dropshipping Work on eBay
So you may be wondering how does dropshipping work on eBay?
First of all here’s an explanation of what dropshipping is:
Dropshipping is a supply chain management method in which the retailer does not keep goods in stock but instead transfers its customer’s orders and shipment details to either the manufacturer, another retailer, or a wholesaler, who then ships the goods directly to the customer. (Source – Wikipedia).
In other words, the dropshipper advertises their products for sale online and when a customer makes a purchase the dropshipper then places that order with the supplier of the product, whom in turn sends the item (or items) out directly to the dropshippers customer.
But how does eBay dropshipping work?
Well, you might be surprised to hear that eBay is not just for selling junk.
The dropshipping on eBay model is a great way of getting started with a side income from home with little to no cost to get started.
See this related post for all the advantages to dropshipping – 13-reasons-to-start-dropshipping-on-eBay
So to act as a dropshipper using eBay you find some products that you want to sell on your eBay account.
You take the photos and product information (which you may want to amend to improve them).
Then you place that information on an eBay listing (usually a Buy it Now listing) and make it live.
It is important to set a price that will ensure you make a profit after eBay fees, Paypal fees, cost of the item and delivery.
With carefully selected products and thorough research, you can select and advertise products that are more likely to sell.
Can You Dropship on eBay?
So now you know what Dropshipping is and how dropshipping works on eBay.
But, I hear you saying are you allowed to dropship on eBay ?
Well, eBay does have a statement saying that they will demote listings or close an account if found to be dropshipping.
This appears to be a warning only rather than a serious clampdown by eBay.
Provided you keep your account in good order and maintain high standards of customer service you shouldn’t see your account closed.
In a way eBay’s seller rating algorithm already takes care of this as they demote any account that has poor or low seller feedback and ratings.
How do I Start Dropshipping on eBay with no Money?
I’m sure you’ll agree it’s a straight forward simple business model that anyone with an eBay account can get started.
But if you are wondering how much money do I need to start dropshipping on eBay? You’ll be pleased to hear that it costs nothing and you can get going dropshipping on eBay with no money.
Due to the fact that you only pay for the item once you have been paid, you don’t need any start-up funds.
The only costs at the outset would be your eBay listing fees however, eBay gives you 1,000 listings with no insertion fees per month as a private seller.
So you really can get started with no upfront cost.
How to Dropship on eBay Step by Step Guide
Here we are to the nitty-gritty.
If you want to learn how to dropship on eBay then this section will show you.
This guide is designed to show you how to dropship on eBay as a beginner.
Step 1. Set up an eBay account
A lot of buyers will be wary of buying brand new products from sellers with no feedback. Therefore if you’ve never used eBay before and have no feedback yet I would recommend you start off selling some of your unwanted items first.
That way you can get an understanding of how eBay works, what the process is for selling and build up some initial feedback so that buyers are more likely to trust you and subsequently buy from you.
Step 2. Find a supplier to dropship products from
You can pretty much use any retailer that sells products online and allows you to have your items posted to a different address. Most retailers do allow you to do this anyway so there is no need to worry.
If you are based on the United States I have heard that Walmart or Costco are also good choices but I can’t vouch for them myself being in the UK.
Step 3. Select your products and list the information on eBay
Now that you’ve identified a retailer that you want to use to supply your products next is how to find items to dropship on your eBay account.
As you are starting out it’s a good idea to keep the cost of items low ideally under £30. This is because if anything goes wrong and you have to issue a refund without being able to get anything back from the retailer then the impact is minimised.
Also if your eBay feedback score and seller rating is low then buyers may be cautious about purchasing expensive items from you. Once you have built up a profile and have items selling regularly then you could try increasing the value.
You should also consider the time of year or season and think about products that are more likely to sell at that time. For example at Christmas Toys are obviously very popular and during the Summer Gardening products are more in demand.
Sometimes it is a case of trial and error but I like to list a product for 30 days with a reasonable margin. If it doesn’t sell within the first 30 days then I will reduce the price to the lowest margin I am willing to take and leave it for another 30 days.
If the listing still doesn’t make any sales then I will cancel the listing and choose another product in its place.
Once you have selected a product you can simply take the images directly from the retailers’ site, download to your computer and upload them to the eBay listing.
You can also copy and paste the product description and sales information directly into your listing.
Then calculate the Buy it Now price you need to charge to cover the purchase of the item from the retailer, your eBay and Paypal selling fees as well a margin for profit.
Finally, save the listing and make it live on eBay, then move on to the next product and list as many items as you want or are permitted to within your eBay listing limits.
Step 4. Make sales and process the orders
Step 4 occurs when you make a sale. You must then go to your retailer that the item is listed from and purchase the item. However, instead of having it delivered to your own address, you can change the delivery address details to that of your customer.
The retailer will then send the item direct to your customer for you. You can do this without any formal agreement with the retailer. They allow you to send items to a different postal address to that on your account.
Step 5. Deal with any returns and keep your account in order
It’s a good idea to give your buyers positive feedback either once they have made the purchase and paid or once you have received confirmation that the product has been shipped.
Buyers are more likely to leave you positive feedback if you have done so for them first.
Inevitably though you will get some returns so this is something to think about before you take the plunge with this business. If you don’t want interaction with the customer that may potentially complain then this is probably not the business model for you.
If you choose your retailers carefully though and communicate well responding to return request swiftly you should be ok. It is a little bit of a pain dealing with returns though as you will have to contact the retailer for details on how to return an item. eBay also makes it really simple for a customer to return something and it can get sent back to you directly.
This is just something you have to factor in and be aware of. If you follow the guidelines above then you shouldn’t have too many returns and this will minimise the impact on your profits.
Using Amazon to Dropship on eBay
Having read the step by step guide on how to dropship on eBay you might be wondering if you can dropship on eBay from Amazon.
You would be right in thinking that yes you can, however, I wouldn’t recommend it as a beginner unless you already have an Amazon Prime account.
The reason being is that you want your items to be shipped out as quickly as possible and there is no guarantee of this unless you have Amazon Prime, which allows you to have items delivered by the next day. At $12.99 per month for the US and £7.99 per month in the UK, you may want to add Amazon to your list of retailers once you are up and running and have started to make a regular dropshipping income.
How do I automate dropshipping on eBay?
There are a few different dropshipping software tools that allow you to integrate your eBay account making it easy to list thousands of items.
I recommend checking out Hustle Got Real as I have used them for a few years and found the software to be pretty good.
However you will pay for each listing with no guarantee of it selling. You won’t necessarily have a strong connecting with your listing. With fewer listings that you can push and make more attractive you can get more sales.
Being selective is therefore a better option.
In my view a combination of using software to help you list items and manually selecting items through your own research is the way to go.
As a beginner though a lot of trial and error is involved to get your sales off the ground before you want to be paying extra for software.
Dropshipping software can help you monitor stock levels and will automatically update listings where the retailer is out of stock. This isn’t 100% fool proof however as occasionally the retailer’s own listings can be out of date showing an item is in stock when it isn’t.
You can’t do a lot about this other than cancelling the order with the customer, waiting to see if the item comes back into stock or you can keep a supply of products yourself to process just in case.
I usually let a retailer off if this only happens occasionally but if they start repeating this then I drop them altogether as it’s not worth the hassle. This is more likely to happen during the christmas build up as retailers become so busy they can’t always keep up with the orders.
Cancelling too many orders for being out of stock will affect your eBay standing. Therefore I notify the customer first tell them there was an error on the listing and issue the refund. I then select the option for Customer requested Cancellation rather than the item is out of stock as eBay don’t mark you down for this.
Is Dropshipping on eBay Worth It ?
Compared to starting your own online store using eBay can be worth it.
There is no advertising needed as eBay takes care of all that so it’s an excellent beginner business model.
If you are wondering why they would pay more for an item they can buy elsewhere for cheaper.
The reason is that consumers get lazy and just used to go to their favourite online store. As many are already on eBay they don’t want to spend time searching.
You are therefore offering them the convenience of being able to shop on one site – eBay. And eBay has many many loyal customers as they know and trust the site for when they shop.
If a customer does get mad and realises you are dropshipping then you can help alleviate that by offering a discount or partial refund. This is actually a rare occurrence anyway provided you select the right retailers to use.
There are some things you have to work on, like finding good selling products, selecting the right retailers to keep your account in tact as well as dealing with returns.
If you are willing to put the effort in up front you will be rewarded.
So there you have it a brief guide on how to dropship on eBay.
Are you interested in starting your own online business?
Will you start dropshipping with eBay?
Let me know by leaving a comment below.