Does anyone really make money drop shipping on eBay?

So far all the advice you have gotten has been correct and good. Drop Shipping as a key part of a business model works as long as you do your homework.

We have recently had some very nice success and we are a drop ship only site. Looking back, many of the decisions that I made early on have led to our success and back then I had a gut instinct that they would, but I really was not sure. Hindsight is 20/20 and I can see now that I made some good decisions and here is how this relates to your questions.

1. Research - I spent months researching our market. eBay was my first thought. After researching the sales of my niche's products on eBay, I realized that there was no way I could make any money through that venue. I was stunned at the prices that I was finding. I know that some people are better negotiators then others but I also think some have less business sense and are going through efforts on eBay that are making such little profits that it is not worth it. Sure, if you have "The Thing" that everybody wants and only you have, then sure, but how often does that happen?

2. The Product - During my research, I found that everyone online was selling the same brand of the type of product that I was considering selling. My dad was a maverick and always told me "Do what the other guy won't". He died broke and early, but I guess genetically I have had no choice, because it is how I think as well. Anyway, I watched as a dozen of my competitors all fought over the same sale.

So, I found a similar but higher-end product with a great brand name to represent. I can't begin to compete with my competition on price, and we all know that most of eBay is about PRICE. We opted to build our own site and stay away from ebay. We advertise on most of the popular shopping comparison sites and this has worked great.

3. I don't want every customer - We decided through our brand choice and our philosophy that we really did not want every one of our competitors customers. We focused on people who understood VALUE over PRICE. Once our customer has decided that even though we may be as much as 25% higher, they are better off with our brand and our service, our job is done. Even in this economy, there are those that are wired t chose value.

Back to Drop Shipping. The nice part about finding a manufacturer or distributor and forming an alliance is that once you do start doing sizable business, you then have the power to negotiate better prices and services and from that, margins will increase.

Our vendor has stuck with us for months and has been a partner in our business with thier support. We have been very fortunate in that regard. But, in the last couple of months, our business has gone up dramatically and we are not processing multiple orders daily and $3500 - $4500 orders are not uncommon. Now, we are hero's in the eyes and balance sheet of our supplier and they are wanting to help us more. It is how it works.

To Close - Drop Shipping can work. Find a niche. Get an edge. Separate yourself from the Pack (do what the other guy won't do)

Good Luck
Jay