Dropshipping is a tricky business to get into. I will warn against dropship wholesale programs like the ones that show up when you Google search for ‘dropshipping’. Only because they aren’t a true dropshipper. They are the middle man. They advertise products with a “retail price” that is higher than any where else that you can buy the product (like Amazon for example) then they’ll list their price as the wholesale price which is more comparable to the actual “street price” thus leaving you with very little margins or even sometimes you can find the same product for cheaper on Amazon.

The ‘real’ way to get into dropshipping is to contact manufacturers directly. Large companies will most likely ingore your requests to work with an individual selling on eBay. Most eBay sellers that are able to make some good money are those actually have a brick-and-mortar retail store that sell their additional inventory on eBay. You’d have much better luck setting up a dropshipping agreement with companies if you had an established retail business in that niche.

You need to find a specific niche that will work. Consumer electronics are very popular for consumers. This means that everyone and their dog are trying to sell those things on eBay creating a lot of competition and very low profit margins.

I’m not saying that it’s impossible to get started with a eBay dropshipping business but you’ll spend far too much time and money before you see a return on investment. There are much better ways to earn money with physical products on the internet.

To get started with an eBay business, the best way would be to create your own physical products to sell. I’ve coached people that sell all sorts of things on eBay. I’ve seen the most success when people sell their own products on eBay. Make and sell candles or soaps. If you’re good with fixing things up. Hit thrift stores and garage sales to find things to restore and sell. By making your own product you have more control over your inventory and product selection. Once you begin selling regularly on eBay then you can start branching out to include other products that are related to your products. For example, if you make and sell candles. Find a dropshipper for Candle Warmers.

This will be the best way to get started with a dropshipping ebay business.

Today, I’m going to talk a little bit about having an eBay business online.  eBay is a great way to start if you are just beginning your online business.  This is so for two reasons – First, eBay already has a system in place.  A system of selling online through eBay’s marketplace.  This makes it easy to get setup with an online selling platform.  Secondly, eBay is popular and attracts millions of people per day to find items and products at great prices.  So many of those people could be your potential customers if your online business has a presence on eBay.
A lot of you listening to this podcast episode may already be very familiar with eBay for one reason or another but I hope that this podcast episode proves to be a great refresher or reminder to the advantages of eBay for your online business.
I’m going to spend the next few minutes going through an eBay overview and talking about “eBay economics”

1 – eBay is primarily an auction website. The auction format is such that the more interested parties that you have in any particular product, the more bids that you will receive for that product.  So the ‘product demand’ is what drives the price up.  Makes sense doesn’t it?  You will be the most successful on eBay if you offer for auction the products that are in ‘demand’.  Beware of doing this though because the more demand that a product has, the higher that the competition will be.  That is business basics.  Other sellers see that any particular product is selling well and they want a piece of the action.  That creates more competition for that product.  Let’s take the Apple iPod for example.  It’s a very hot selling item.  So many people think that they can get rich quick just being able to sell the iPod.  But how many other places on the internet can a consumer purchase an iPod?  eBay is such a successful online marketplace because it offers consumers “great deals” on consumer goods and products.

2 – eBay is an eCommerce platform. An eBay store can be your own online store.  The eBay store can be the center of your online sales efforts.  An eBay store can work a little differently than regular eBay auctions.  First of all, an eBay store can carry your inventory for 30 days then can be automatically updated instead of the regular eBay auctions lasting up to 10 days.  Other differences include selling your products at a fixed price instead of an auction format.  Regular eBay listings can be set to run as a “fixed price” or a Buy-It-Now listing.


3 – eBay is an online community. eBay has a feedback rating system that is designed to offer credibility to eBay’s users.  eBay also has the eBay MyWorld which is the center of eBay’s online community.  MyWorld includes a blogging platform, article directory (Reviews and Guides), social networking (Neighborhoods).  Participating the eBay’s online community can help you establish credibility and promote products in your eBay store.

Basic eBay Tools:

• eBay Research – Terapeak
• Photo Hosting – Photobucket, Flickr
• eBay Auction Management – Auctiva
• Professional Auction Templates – vFlyer

**This is only Part 1 of a multiple part Series on eBay.