Dropshipping is a low-risk business model where responsibilities are split between Supplier and Dropshipper, but brand and business control is in the arms of the Dropshipper. A dropshipper organizes the online store, searches for reliable suppliers, attracts clients, takes orders, and deals with complaints. Supplier produces or buys the goods for storage at its own warehouse and delivers them to the client’s address provided by the dropshipper.
Suppliers can work with many dropshippers and use other retail models, but in the end, all excesses not sold will be their loss. Also, there are additional expenses on production sites, equipment, other inventory, and workforce. At the same time, a dropshipper invests only money for online store creation, business registration, and marketing campaigns. And such expenses are not comparable. That is why dropshipping is a recommended business for retail beginners.
This article explains one of the possible dropshipping models – an online store on the eBay platform.
Why eBay is a suitable platform for dropshippers
There are many platforms that can be used for selling goods by dropshippers. eBay, Amazon, Shopify, and Walmart are among the most popular in 2023. E-commerce is a software product allowing the creation of an online store there. These marketplaces are aimed at different products and auditory, so you need to collect information before starting to sell there. For example, eBay is more suitable for small online stores, while Amazon is better for large ones.
The main advantages of eBay dropshipping are:
- No requirements for the availability of goods in a dropshipper warehouse.
- Many and clear guidance for creating a dropshipper account on eBay.
- Massive traffic of visitors every day, almost $2 billion in transactions.
- Clear and known purchase model for Clients based on the auctions allowing them to sell with increased price.
- Possibility to scale your business.
- Estimated initial investments as all subscription prices are known.
- Flexibility to change goods or niches for sale.
No doubt, there are some drawbacks, such as the possibility of finding a supplier corresponding to strict eBay policy, limited possibilities for your brand awareness, extensive competition, and low profitability. But almost all drawbacks are the same for other e-commerce platforms.
So, let’s continue to organize business on eBay.
Step-by-step guide for starting a dropshipping business on eBay
To start a dropshipping business on eBay, you need to do all steps listed for better results. This article only briefly explains all steps; for more details, please read this Dropshipping guide.
- Review eBay policies and requirements for suppliers. If you do not follow these rules, your account will be banned. Also, you need to check the subscription fees (for the online store, listings, and transactions).
- Determine your dropshipping niche and check if these products are popular on eBay. You can do vice versa; check the most popular eBay products and sell the same. Another way is to search for reliable suppliers, for example, on AliExpress, willing to work with dropshippers. In 2023 the most popular items are disposable face masks and cell phones.
- Register your business and open a bank account. All formalities should be performed before you open your eBay account. Some registration processes require a couple of days or weeks; paying for a subscription during this time does not make sense. You need to determine the legal form and understand how you pay taxes.
- Choose Suppliers. If you want to stay in this business for a long time and receive the most possible profit, having long-term relationships with suppliers is recommended. In such a case, you will receive the distributor’s discount, already know all delivery terms, and can rely on the quality of the goods. This step is essential, as the good’s quality and delivery terms are the Supplier’s responsibility, where you do not have influence. You may only change the Supplier.
It is recommended to have several suppliers for the same goods with equal product quality to have the possibility to choose the Supplier based on the location of the client and to have the possibility not to lose orders in case of the extreme popularity of your online store.
- Set up an eBay account. The basic store subscription is $21.95 for 1000 listings per month and 250 listings for auction. There are other plans; you need to choose the most suitable for the quantity of your goods. You need to sign up for the eBay website where you are going to sell.
- Create your online store. You need to create a colorful, detailed website with complete goods information. For that, you need to connect your eBay account with the wholesaler’s platforms with the source products. There are many applications for that. Such software automatically makes listings. You need to place only professional photos and videos; all texts should have enough keywords to be easily understood by search engines.
- Price the items. You need to determine a pricing campaign, whether it will be a fixed percent from the Supplier price or manual set price. As there is a completion, you need to know your supplier price campaign.
- Determine the payment method for Clients. The website should be a user-friendly navigation, designed with the best templates that represent your brand; the Clients should be able to make a purchase and pay using several payment options as Visa, PayPal, or American Express.
After you set up the website, you can test it by starting the order fulfillment. You can make the order, send it to the Supplier and check the delivery terms and product quality. In case of any problems, you can do another research on dropshipping niche or a supplier.
There are a considerable number of software applications that can automate almost all steps of your dropshipping business. You can use them to find trending dropshipping goods, do listings, create an online store or even do order fulfillment. The most valuable applications are not for free, but they allow you to control your business without additional employees and to expand effortlessly.
If you organize your business correctly, minimize mistakes, and increase the speed of order fulfillment with software applications, then your dropshipping business on eBay will be profitable. This article is an excellent start to have a good foundation for your business. But please remember, you can always do everything at your own pace; dropshipping is a low-risk business, so you can always try to do everything differently.