Is Drop Shipping on Ebay from Wholesalers still a good way to make some extra cash?

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See title. I want to start Dropshipping on EBay from wholesalers. Is this still a viable way to make money or no? Anyone have any experience doing this?

Note that I will be dropshipping from wholesalers to the customer, not from Amazon to EBay. Meaning that I will do research and contact companies (non-membership companies) after getting their information from the company that creates the products. I have an EIN already, so I can make accounts. I just want to make sure this is a viable way to make some money.
#cash #drop #ebay #extra #good #make #shipping #wholesalers
  • Profile picture of the author webmarketer
    The common issue here is the drop shipper's reliability. When the drop shipper/manufacturer fails to deliver on time, you get the shaft not only from your customer but also from Ebay. At least, that's what I read online.

    Remember that you still have an account to protect and maintain at Ebay.
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    • Profile picture of the author Drewdude1991
      Absolutely! I agree with you 100% on that! I am more worried about profit however, as I do not want to put in all this work to end up with chump change.
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      • Profile picture of the author webmarketer
        Originally Posted by Drewdude1991 View Post

        Absolutely! I agree with you 100% on that! I am more worried about profit however, as I do not want to put in all this work to end up with chump change.
        Cost of goods will be around 40% to 60%, depending upon the item. Ask your supplier if they maintain strict compliance of standard/universal pricing to consumers--even if it is sold at Ebay.

        Try to sell a product worth at least over $150. Why? If your acquisition is 60%, your margin is around $60 for a MSRP of $150. Depending what your PPC cost is, if you want to buy traffic, you can compare scenarios of order rates where you'll be in the black, in the red or will break-even.
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        • Profile picture of the author Drewdude1991
          Again, I agree with you completely! Selling at $150+ means that I wouldn't need to sell as much to see a higher profit, as opposed to selling $10 items
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      • Profile picture of the author Importexport
        Originally Posted by Drewdude1991 View Post

        Absolutely! I agree with you 100% on that! I am more worried about profit however, as I do not want to put in all this work to end up with chump change.
        "Successful" dropship resellers usually quote turnover, i.e., gross sales rather than profit figures, but there are many posts on WF stating dropship profit margins of 10%. Some quote higher, even as high as 30%, but it is rare to see figures like the one posted by @webmarketer above. On his figures margins work out at 40%.

        Most dropshippers are obviously just providing cheap labor for the wholesalers.

        The post #7 by @Randall Magwood puts a more likely scenario. Extremely low margins or losses.

        If buying within your home country (in your case the US) you will usually have to buy through distributors or wholesalers, and they have already eaten up a large part of the potential profit.

        There is a viable alternative, and that is to buy direct from manufacturers overseas. The huge profit margins will boggle the mind.

        "If you think education is expensive - consider the cost of ignorance."
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        • Profile picture of the author webmarketer
          It's even higher at 50%. Get your items drop shipped by manufacturers instead of wholesalers/resellers. In other words, I didn't rely on wholesaler lists of drop shippers for sale.

          And remember it depends upon the product you're selling.

          My former suppliers are from the US.

          Originally Posted by Importexport View Post

          "Successful" dropship resellers usually quote turnover, i.e., gross sales rather than profit figures, but there are many posts on WF stating dropship profit margins of 10%. Some quote higher, even as high as 30%, but it is rare to see figures like the one posted by @webmarketer above. On his figures margins work out at 40%.

          Most dropshippers are obviously just providing cheap labor for the wholesalers.

          The post #7 by @Randall Magwood puts a more likely scenario. Extremely low margins or losses.

          If buying within your home country (in your case the US) you will usually have to buy through distributors or wholesalers, and they have already eaten up a large part of the potential profit.

          There is a viable alternative, and that is to buy direct from manufacturers overseas. The huge profit margins will boggle the mind.

          "If you think education is expensive - consider the cost of ignorance."
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          • Profile picture of the author Importexport
            Originally Posted by webmarketer View Post

            It's even higher at 50%. Get your items drop shipped by manufacturers instead of wholesalers/resellers. In other words, I didn't rely on wholesaler lists of drop shippers for sale.

            And remember it depends upon the product you're selling.

            My former suppliers are from the US.
            Your calculation at 50% margin is different to mine at 40%, but no matter..... Even at 50% margin that is still working for peanuts as far as I am concerned.

            The big question is why do it when it is possible to make much, much bigger margins by buying direct from overseas manufacturers? I am talking about margins as high as 300% or even more.

            "If you think education is expensive - consider the cost of ignorance."
            Signature
            Don't just slap on a label. Build a GREAT BRAND https://Labelsthatexploit.com Safe sourcing and easy importing from 41 countries globally. https://provenglobalsourcing.com
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            • Profile picture of the author webmarketer
              I initally said 40%, which was a margin from one of my ex-suppliers. The 50% was from another.

              Here are my reasons:

              It's a whole different discipline that I am not familiar with--meaning I have to study this.

              There is a new learning curve--customs issues, harmony codes (restrictions), local source regulations, drop shippers integrity (say from China sources), quality control issues, FDA, etc. etc. etc.

              Then there is the drop ship schedule to concern myself with since the supply is coming from overseas--possible headaches with suppliers, customers, Ebay, and eventually, my account.

              There's just a lot of variables. Sure, the margins, as you say, could be > or = 300% and done the right way, it could be very lucrative. But I'm not one to dive into something I am not comfortable with since I don't have an awareness of the details to do it right.

              The above plus more I'm not aware of and the thought of stocking inventory for required minimum orders. Of course now, I have to do packing and shipping per order, myself. Uhm, no.

              If the assignment is not done correctly, this mistake is too costly.

              With US suppliers, the %age of profit may not compare with the margins from China, but, there's less headache, lesser cost of investment--you only pay the actual items ordered, suppliers are easily accessible, delivery schedules are easily sorted out, and there's no inventory required. I know some guys making $3-5K net a month and this is only from one ecommerce store.

              It's a matter of perspective.


              Originally Posted by Importexport View Post

              Your calculation at 50% margin is different to mine at 40%, but no matter..... Even at 50% margin that is still working for peanuts as far as I am concerned.

              The big question is why do it when it is possible to make much, much bigger margins by buying direct from overseas manufacturers? I am talking about margins as high as 300% or even more.
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              • Profile picture of the author Importexport
                Originally Posted by webmarketer View Post

                I initally said 40%, which was a margin from one of my ex-suppliers. The 50% was from another.

                Here are my reasons:

                It's a whole different discipline that I am not familiar with--meaning I have to study this.

                There is a new learning curve--customs issues, harmony codes (restrictions), local source regulations, drop shippers integrity (say from China sources), quality control issues, FDA, etc. etc. etc.

                Then there is the drop ship schedule to concern myself with since the supply is coming from overseas--possible headaches with suppliers, customers, Ebay, and eventually, my account.

                There's just a lot of variables. Sure, the margins, as you say, could be > or = 300% and done the right way, it could be very lucrative. But I'm not one to dive into something I am not comfortable with since I don't have an awareness of the details to do it right.

                The above plus more I'm not aware of and the thought of stocking inventory for required minimum orders. Of course now, I have to do packing and shipping per order, myself. Uhm, no.

                If the assignment is not done correctly, this mistake is too costly.

                With US suppliers, the %age of profit may not compare with the margins from China, but, there's less headache, lesser cost of investment--you only pay the actual items ordered, suppliers are easily accessible, delivery schedules are easily sorted out, and there's no inventory required. I know some guys making $3-5K net a month and this is only from one ecommerce store.

                It's a matter of perspective.
                I agree that it is a matter of perspective, but I suggest that you might be looking at this from too narrow a perspective.

                First I would never recommend dropshipping from overseas.

                I am only suggesting that direct importing is a viable alternative to dropshipping for two reasons.
                • Real profits, not the very poor margins usually quoted, and referred to in posts by various warriors in this thread and others.
                • Only a small outlay is necessary, with many of my book users starting off with as little as $300.
                The newbie importers that I teach don't need to worry about the problems you have listed, such as customs issues, harmony codes (restrictions), local source regulations, quality control issues, FDA, etc. etc. etc., because I teach them how to import the easy way without needing to learn all the rules and regulations.


                You mention the minimum order requirements. These are commonly known as MOQ, and the idea that you have to buy huge MOQs from overseas suppliers is a myth. I teach how to get genuine manufacturers to supply orders in smaller quantities at ex-factory prices.

                Also, very many importers never handle the inventory themselves, except sometimes in the early stages of their business.

                I have taught hundreds how to do it and I enjoy reading their success stories. You might like to read something about safe sourcing overseas and easy importing in my AMA thread: Ask Me Anything About Product Sourcing And Importing For Profit. ― Veteran Importer Here. where I answer questions from warriors on the subject.

                "If you think education is expensive - consider the cost of ignorance."
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                Don't just slap on a label. Build a GREAT BRAND https://Labelsthatexploit.com Safe sourcing and easy importing from 41 countries globally. https://provenglobalsourcing.com
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  • Profile picture of the author Randall Magwood
    The main problem with dropshipping is that:

    1) Extremely high shipping costs per sale
    2) Extremely low profit margins

    Selling physical products on Ebay is still a good idea, but dropshipping to the customer.... you will find most dropshippers and *wholesalers* spike up the costs of goods so that you barely make a decent amount of money. If a product costs $100, expect the going price only to be $90, and your shipping cost to be $25.
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  • Profile picture of the author Jennifer Hutson
    Yes, I do it but I don't "technically" dropship. It's easy to list items on eBay and order them from Amazon straight to your customer's address with a PayPal business debit card and a Prime account.

    The hard part is finding products that sell regularly, which can be done pretty easily after some testing.

    You never have to pay shipping costs, items get there super fast, customers are happy and you have zero startup capital.
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    • Profile picture of the author sunchyme
      Originally Posted by Jennifer Hutson View Post

      Yes, I do it but I don't "technically" dropship. It's easy to list items on eBay and order them from Amazon straight to your customer's address with a PayPal business debit card and a Prime account.

      The hard part is finding products that sell regularly, which can be done pretty easily after some testing.

      You never have to pay shipping costs, items get there super fast, customers are happy and you have zero startup capital.
      Do you worry if the package arrives to the customer with the original seller's branding on box / inside package?
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      • Profile picture of the author Jennifer Hutson
        Originally Posted by sunchyme View Post

        Do you worry if the package arrives to the customer with the original seller's branding on box / inside package?
        Nope, customers very rarely say anything and you always send as a gift so there isn't an invoice.
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  • Profile picture of the author J Thornhill
    I have done this as well to an extent. I think the main thing is to find the best wholesalers who will give you the best deal with the cost of the unit and the main priority is shipped in a timely manner. As it has been mentioned above a lot of the suppliers I have contacted in the past sells on Amazon and Ebay as well as a result making more competition for you.
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    • Profile picture of the author phoebe2015
      good wholesalers are indeed very important.

      check out this site...(use google translate).[url=http://world.taobao.com/]
      they have very good prices and great variety!

      shipping is very reasonable too (most vendors here do a good job). I've bought furniture, bicycle stand, and electrical appliances from this site and got it shipped over.

      and becos of this great site, I'm thinking of going into dropshipping too...
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  • Profile picture of the author Gambino
    The key to dropshipping in any form is getting deals that everyone else isn't getting. The leg work has to be put in to get exclusive deals directly from manufacturers where you avoid the retail pricing and dropshipping deals and can make good margins. If you try to do it with standard run-of-the-mill dropshippers your margins will be tiny, if anything at all.
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  • Profile picture of the author essmeier
    For the past dozen years or so, I've found eBay to be a terrible place to sell, as it's now largely a buyer's market. I've had much better success buying merchandise on eBay and selling it on my own Websites.

    Find something interesting that's relatively rare in the real world but fairly common on eBay.
    Buy all the nice examples that turn up for sale on eBay.
    Build a specialty Website that sells this one item.
    Clean it, fix it, offer to ship it for free and charge whatever you like.

    It works.

    Charlie
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  • Profile picture of the author Therion
    I've found it's easier to take possession of an entire overstock load, sell the goods below wholesale individually and make a killing. I'm buying $693,000 Amazon overstock merchandise loads (brand new stuff) for 9-11% of retail price. I'm buying Fingerhut truckloads ($60k-$110k) for 11-12% retail. Same with Home Depot (tools, etc.).

    Whoever above said reliability is an issue with dropshipping is correct. Besides, you're really not getting goods too far below retail. Buy truckloads of goods, or even 10-14 pallets, put them in a storage shed, and fulfill orders on Amazon, etc.
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  • Profile picture of the author paververisgroup
    Once you find legitimate wholesalers/drop shippers, it is a good idea to research them and see if there are any reviews. I have found several from searching on Google.com. Make sure they require that you use a business license/EID (US) to open an account with them, or they may be a scam.
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  • Profile picture of the author chuff1026
    i am saddened to see how many people think that dropshipping doesnt make sense on ebay anymore
    i have been making about 10k a month profit for the last couple of years dropshipping on ebay
    if you know what you are doing
    it works
    i can show anyone
    in about 10 minutes why its viable
    and i can pretty much show anyone how to make money dropshipping on ebay
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