Monday, July 13, 2009

Drop Shipping is a Low Cost, Low Risk Way to Start Selling on eBay by Worldwide Brands

By Chris Malta, CEO & Founder of Worldwide Brands

Wholesale Tip Series: Tip #10

When you are new to selling on eBay, you may not have a lot of money to buy in Light Bulk quantities, store inventory and manage your own shipments. Drop Shipping used to be a popular wholesale option that lets you avoid a lot of start up expense or risk. eBay is finding that eBay sellers who carry their own – even small – inventory are providing an excellent buying experience to their customers because they are always in control from the time of the customer’s order to the time of delivery to a happy customer.

You need to select your drop ship supplier carefully. Purchase one of each product you plan to list and sell regularly. Check and make sure the drop shipper picks, packs and ships within two days, preferably the same day. Test to ensure you have a good buying experience for yourself!

If you are starting out short of cash, you can work with those wholesale suppliers who offer drop shipping. Remember most wholesalers are not set up to sell single products at-a-time. Finding a good drop shipper is difficult. Typically, most web sites advertising drop shipping - especially in the search engines – turn out to be a wholesale scam.

With a REAL drop shipper, the process works like this: You establish an account with the drop shipper. The drop shipper provides product pictures and descriptions to use in your eBay auction listing and on your eBay Store. When someone buys one of the products you have listed, you immediately email your drop shipper, who picks packs and sends the item from THEIR warehouse to your customer's address, on your behalf. You have already received payment of the retail price from your customer. You now pay the wholesale price to the drop shipper once they ship the product. If you have sold at the right retail price, you make a profit! And you haven’t even touched the product you sold. The drop shipper typically includes all the out-of-pocket expenses in their drop ship fee.

Drop shipping is NOT a perfect permanent solution. Drop shipping products requires you pay a slightly higher wholesale price than you will be charged if you purchased those same products in volume. Wholesaling is a volume business. The wholesale price for a single item is higher than your wholesale price when buying in bulk or even Light Bulk. The drop ship wholesale supplier typically has to maintain a separate warehouse for inventory assigned as drop ship inventory. In addition they must pay employees in the warehouse to pick, pack and ship each individual product for you. Because it costs the drop shipper more in handling, your drop shipping costs are going to reflect that.

Drop shipping may be an excellent entry point into selling on eBay because it is a very low-risk way to test new products without having to invest in inventory that may not sell. Worldwide Brands recommends eBay sellers only use drop shipping to identify products that sell well from their eBay auction listings or eBay Stores. As these generate cash, the eBay seller should use the cash to start buying those better-selling products at least in Light Bulk to increase profit margins. Your business will start to grow. This is how most successful eBay sellers got started, and it should work for you!

Worldwide Brands is an eBay Certified Solution Provider providing product sourcing access and information for eBay sellers. They are the publishers of an extensive directory of legitimate, fully-verified ecommerce wholesalers and manufacturers.

1 comment:

Hugo said...

I recently came across your blog and have been reading about Debt Drop ship supplier. I thought I would leave my first comment. I dont know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.