| Unless you have been living under a rock for the past | | | | writing this article instead of spending all my free time |
| few years, you know what eBay is. You have | | | | becoming an eBay millionaire? Yes, unfortunately, there |
| probably also of people making millions via this online | | | | is a downside to using dropshippers, and it lies in the |
| auction website, people becoming full-time eBay sellers | | | | fact that you have very little control over what the |
| and using eBay as the sole source of their monthly | | | | dropshipper delivers and when. After all, remember |
| income. How do they do it? There are many | | | | that, in the final analysis, the objective of the |
| strategies for eBay success that, while interesting and | | | | dropshipper is to take your money; they do not care |
| definitely profitable, are entirely outside the scope of | | | | whether the right product arrives at the right time so |
| this article, save for one -- dropshipping. | | | | long as you pay them. Furthermore, since you never |
| Dropshippers are businesses that sell goods are | | | | actually get to see the product you are selling, you |
| wholesale prices and deliver them directly to the | | | | effectively have to trust the dropshipper when they |
| address you specify. For you as an eBay seller, this | | | | claim that it is in good condition and will be delivered on |
| means two things -- that you can offer your product | | | | time. |
| to eBay buyers at below retail prices, and that there is | | | | So suppose the dropshipper that you deal with proved |
| no need for storage space, as the product will be | | | | to be fraudulent -- your buyer is furious with you and |
| shipped directly to the end customer. | | | | with the worthless product they got, and you are |
| Let us illustrate the point by using the example of a | | | | furious with the dropshipper for ruining your reputation. |
| dropshipping business selling clocks. Let's say the retail | | | | Sure, you can write them an angry e-mail and promise |
| price of the clock is $200, and you manage to find a | | | | never to deal with them again, but the fundamental |
| dropshipper that sells it for $150. For you as the eBay | | | | problem is that it is your reputation that will suffer more. |
| seller, this means that you can sell the product for $175 | | | | Your end buyer does not and should not care about |
| -- enough to make a profit, but still below the retail | | | | whether the product came directly from you, from a |
| price. But it gets better - you do not actually need to | | | | dropshipper or from Santa Claus -- they paid the price |
| own the clock when you setup the eBay auction! In | | | | you charged and they have every reason to expect a |
| fact, another advantage of dropshippers is that you | | | | quality product. So while the dropshipper will lose your |
| can sell products that you do not actually have, so long | | | | business (and probably find someone else to trick), you |
| as the dropshipper still has them in stock. This means | | | | are the one that will be stuck with a negative trader |
| that you are free to experiment and test-drive the | | | | feedback - and believe me, on eBay, you don't want |
| market, since even if your product does not sell, all you | | | | to have any of that if you can help it. |
| will lose is the eBay listing fee. | | | | However, all is not bleak in the world of dropshipping. |
| Now suppose that everything goes well and the clock | | | | The good news is that there are reliable dropshippers |
| in question sells. You receive your payment and then -- | | | | out there. The bad news is, however, that most of |
| and only then! -- do you proceed to place an order | | | | them are already taken, meaning that a huge number |
| with the dropshipper, asking the item to be delivered | | | | of eBay sellers are already buying their products to sell |
| directly to the end buyer's doorstep. After shipping | | | | on eBay. As explained above, due to the nature of the |
| costs, you are probably looking at about $20 pure | | | | business, reliable dropshippers are quite rare, so the |
| profit -- it might not be a big deal, but remember that, | | | | ones that are trustworthy already have an army of |
| throughout this entire operation, the biggest amount of | | | | eBay sellers working with them. Here basic economics |
| money you risked at any point was the listing fee! | | | | comes into play - the more people are selling the |
| To summarise, dropshippers offer eBay sellers a | | | | same product, the lower the profit margins are. For |
| number of definite advantages - they let you sell the | | | | you, this means that you do not want to compete with |
| product at below retail prices, eliminate the need to buy | | | | thousands other eBay sellers, as you will have to |
| the product beforehand (and thus risk losing money if it | | | | lower your price to make your product look more |
| does not sell), reduce the need to have storage space | | | | attractive. |
| of your own and, finally, grant you access to overseas | | | | So how do you make money with dropshippers, then? |
| markets. Under normal circumstances, you will be | | | | Broadly speaking, there are two main ways of doing it |
| hard-pressed to make a profit selling heavy items that | | | | -- you can either find a reliable dropshipper that few |
| need to be delivered overseas (the shipping costs are | | | | people have heard of (meaning that you won't be |
| likely to be prohibitive) -- by using dropshippers, | | | | competing against too many eBay sellers), or you can |
| however, you can buy the product from a store | | | | find a niche market to operate in (where competition |
| located in the same area as the end buyer. | | | | will be minimal). In both cases, success with |
| What's the catch? After all, if dropshipping is a sure | | | | dropshipping involves plenty of research, both in terms |
| way to make millions in a month, why do I even bother | | | | of finding the right business and finding the right market. |