I have run my own online dropshipping business and promoted products on eBay. Sometimes I would make a profit, sometimes I wouldn’t!
For those of you new to drop shipping, it is a way of selling products online through a wholesale company that will ship out the products for you to your customers. That means you don’t have to worry about postage and packing of each individual item, as they will send it out for you.
Now, that may sound brilliant, and there are many positives to drop shipping, but there are also some negatives to consider. Lets take a look at some of them.
Positives To A Drop Shipping eBay Business:
- No Shipping - Save time, no packaging, postal rates or customers service.
- Low Start Up Costs - This makes it easy for the average Joe to get started.
- Sell Many Products - Ability to sell many products or just the ones you want.
- Small Risk - No pre-bulk buying or storage issues.
- No Prepay - You pay the drop shippers after you get paid. *(Please see below)
Negatives To A Drop Shipping eBay Business:
- Drop Shipping Competition - There are many drop shipping eBay businesses, so there is a lot of competition out there. This can affect your prices, as you may have to lower them in order to compete.
- Out Of Stock - Drop shippers sell out on popular items! This can hurt your eBay reputation.
- eBay Owns PayPal- So you get hit with a eBay listing fee, selling fee & PayPal money transaction fee.
- PayPal* - Will hold your buyer’s funds until after you ship the order, which means you are prepaying your drop shipper (this is only for new sellers)..
- Profit Margin - Lower distributor price’s, eBay fee’s and out of stock items – makes it almost impossible to compete with the power sellers.
Running your own drop shipping eBay business is a great way for those of us that only want to advertise and sell other people’s products! And don’t get me wrong, eBay is a very established platform, with a huge traffic base, that seems to have all the angles covered.
As with anything new, there will be a learning curve. Your product selection/price will have to be researched more diligently to find the right niche with the least competition! Stay Positive by design…