5 Rules You Must Follow If You Are Going To Profitably Drop Ship
On
At first glance, drop shipping on eBay looks like every
beginner's dream. All you need to do is list a product on eBay,
collect the money when it sells, and someone else does
everything else. You don't have to purchase or store any
inventory. There's no standing in line at the Post Office, no
packing items, and no need to buy a camera or other photo
equipment.
Sounds like the perfect business doesn't it? Unfortunately,
nothing could be further from the truth. In reality, for most
people, drop shipping on eBay is almost a certain recipe for
failure and 95% or more of the sellers who try it will fail.
To give yourself any chance to succeed on eBay with this
business model there are five rules you MUST follow:
1. You MUST locate a product that will sell in large enough
quantities to allow you a chance to succeed. Finding a drop
shipper who sells hand-woven wool blankets featuring Old
Faithful erupting in the center doesn't mean anyone is going to
buy one to place on their bed.
When considering drop shipping any product, the first thing you
must do is sufficient research to determine if there's a market
for it. If you are going to be successful theremust be a
good-sized active market for your item.
2. You MUST locate a product that provides a sufficient markup
that allows you a reasonable profit. You are not going to be
successful in the long term selling something that you only make
a $10 or $20 profit from each item. With that kind of profit per
item, it's just not reasonable to expect you can sell enough to
attain long-term success.
3. Limit yourself to selling only a few related items that are
all targeted at the same market. By limiting yourself like this
you can decrease your costs, become more knowledgeable about
your market than other sellers are, and in the long-term will
make things more profitable.
4. Purchase a small supply of each item you sell to keep on hand
for emergencies. While drop shipping may eliminate a lot of the
headaches of selling on eBay, it adds a new one to the mix.
There are going to be occasions when the drop shipper doesn't
have the item you've sold in stock for immediate shipment. When
this happens, and it will, you can ship one of the items you
have in your possession so the buyer doesn't have to wait. The
negative impact of not shipping an item immediately reflects on
you and not the drop shipper.
5. Take the time to find a reputable local drop shipper. The
popularity of drop shipping has attracted a lot of people who
are just out to take advantage of you into the marketplace.
Avoid drop shipping lists, turnkey eBay drop shipping programs,
and drop shipping membership sites like the plague.
Rather, spend the time needed to locate a company reasonably
locale to you that will allow you to sell their products on eBay
and drop ship them for you. You'll have less competition, higher
profit margins, and a much higher chance of succeeding. While
drop shipping is a tough business model to succeed in, if you
follow these five rules and believe you will succeed, you will
have a much better chance to build a profitable eBay business
for the long term.