The Down Side Of Using Dropshippers In The Ebay Auction Arena!

Ok, let me just say right up front that I am not against drop-shipping! I love the concept. If you are dealing with a particular wholesale drop-shipping distributor that is serving your Ebay ambitions well, then hold onto that company with bonds of steel, for truly good drop-shippers are hard to find!

Drop-Shipping sounds like the utopian business model. No up front investment in inventory. You don't have to carry packages to the Post Office, United Parcel, or Fedex. All you have to do is set up your own business, auction, or retail website and advertise the products that the company provides. Once the orders come in, you forward it to the drop-shipper and they send the product directly to your customer.

But, the devil is always in the details. Dropshipping is best suited for a stand alone E-Commerce website, mail order, or catalog advertising venue. If you are considering using a wholesale drop shipper for your Ebay auction, then you might want to take a step back and let me provide you with some "points to ponder."

Back ordered products..The reality is that drop-shipping companies run out of product and will be back ordered. Ebay bidders purchase product in "real time." They are under the impression that the item you auction, is the item they bought, not a product that is subject to shortages.

One or two customers might be understanding about the situation, but most will not. If you happen to run out of product on a regular basis then your negative feedback rating will go through the roof, and your reputation will suffer.

One way to combat shortages is to buy a pallet of product in advance, and have the drop-shipper store it in their warehouse so that you are assured of an ample supply. This method sort of goes against the idea of Drop-Shipping (buying the product in advance) but if you are selling on Ebay, you would be best served by employing this method.

Also, if possible, find a drop-shipper in your area, or within a comfortable traveling distance. If you run into any supply or shipping problems, then you could be on hand to visit the facility, should any shipping or logistic concerns arise.

Fees..Some dropshippers will charge you a sign up, or entry fee of about twenty five to fifty dollars just for the privilege of selling their product. You are also charged a "processing fee" for sending the product to your customer.

The "price for processing" can range anywhere from seven to twenty dollars per item, depending on the type of merchandise you are selling. These expenses, plus Ebay fees, can take a big chunk out of your bottom line. Finding a product that can bring you a profit, as well as offseting these types of expenses, can be a delicate balancing act.

Circumventing your customers..While I do not believe that this is a pervasive practice among drop-shipping companies, anecdotal evidence has suggested that some unscrupulous enterprises can cut you out of the sales loop. They could they easily substitute your return address for their company logo, selling directly to your customers.

Market saturation..One of the largest wholesale drop-shippers in the county is the B&F System, BNFusa.com. A lot of Ebayer's started selling their products, one in particular, called Giovanni Navarre leather jackets. At first, it was a profitable item. After a while, everyone started selling the same product. Too much of the same supply, creates market saturation, ultimately destroying profit potential for the seller.

The Giovanni Navarre leather jackets are still being sold on Ebay today, but I doubt that they still provide a very profitable return for the seller. Even though B&F carries over 500 products in 14 different categories, they are intimately familiar to the Ebay community. You could probably make a great profit from just about any B&F product if you were to sell them off line, and out of the auction arena.

When a company becomes too well known to the general public it becomes almost impossible to make money from products that have flooded the marketplace. In addition to finding a drop-shipper who is close to home, it might be a good idea to find a DS company that is not well known to the Ebay market, or who's products have not been scattered all over cyberspace.

These days however, it is hard to find drop-shippers that will cater to the smaller seller. Most will find it more profitable to sell in volume than by the piece. The larger wholesale dropshipping distributors are used by retail catalog operations. To get involved with the larger operations, you would have to be doing a tremendous sales volume.

If you still want to pursue drop-shipping as a source of supply for your Ebay auction, then I would suggest that you read other opinions, and become as educated as you can about the drop-shipping company you do business with.

A good and inexpensive start to finding drop-shipping companies is the Drop Shipping News: http://www.drop-shipping-news.com . Remember, when it comes to Ebay auction selling, "own what you sell." Never leave customer service, or your feedback rating in the hands of other people!!

Robert C. Potter is a wholesale and retail surplus products specialist. He is the author of "The Ultimate Guide To Products For Resale!" Over 300 Wholesale & Surplus Supply Sources For Ebay Auction Sellers, E-Commerce Websites, Flea Market Vendors, and Retail Store Owners! You can find his 160 page ebook at: http://www.productsforresale.com.

---

Ebooks, Scripts, Websites, and more...

Adsense websites

Eating and Thriving On-Line

The Internet SHOULD be "the place to shop" for low-carb... Read More

Your eBay Business - 8 Ways To Insure Its Success

I don't know if you've ever noticed, but it seems... Read More

Why Its a BAD Idea To Promote Hot Selling Products on eBay

Do a quick search on Google, Yahoo, or your favorite... Read More

Auction Seller Guide To Success

When its time to clean-up around the house, some people... Read More

How To Sell On Ebay & Keep Your Shirt

Have you ever been delighted after a huge sale on... Read More

Can You Really Make Money Selling New Release CDs & DVDs On eBay?

Being an active eBayer, I am often being asked about... Read More

Online Auction Sellers - Seize Control Of Your Business!

As the online auction model of business continues to evolve... Read More

How To List Your Items On eBay

Listing your items on eBay can be very confusing if... Read More

Turn Your eBay Experience Into Even More Profit

Everyone's talking about eBay these days. With the frequency of... Read More

Online Auctions: The New Way of Shopping for Mauritians

Since their introduction several years ago, online auctions, such as... Read More

Game Theory, Nobel Prize, & Auctions - Auction Primer Series ? Part 1

William Vickrey, highly regarded as the founder of auction theory,... Read More

How To Write a Traffic Pulling eBay Auction Title

Selling an item on eBay should be simple but it... Read More

12 Items You CANT Sell On EBay

Millions of would-be entrepreneurs want to sell things on ebay.... Read More

Increase your eBay Profits the Easy Way

Sometimes the simplest things can boost the number of visitors... Read More

eBay - The Basics

I began selling on eBay in 1999 and have found... Read More

5 Sure-Fire Ways to Make More Money on EBay

Have you ever dealt with a salesperson or a waiter... Read More

How To Sell On Ebay: The Money Is In The Back-End

Many people who sell on Ebay completely neglect the follow-up... Read More

Make Money on eBay the EASY way!

Probably just like you, I had an overwhelming desire to... Read More

Earn Money Now from Selling Childrens Items on Ebay

Kids Items You Can SellClothes, toys and videos are good... Read More

Drop Shipping Your Way to Increased Profits

Drop shipping, for those who are unfamiliar with it, is... Read More

eBay - Getting More Bids Using An Auction Preview

If you sell in small niches as I recommend and... Read More

Dropship Your Way To Ebusiness Success

Q: I would like to start my own eBay business,... Read More

Seven Steps to eBay Selling Success

More and more people try their luck at selling on... Read More

Join the Home-Based Business Revolution

Greetings, Friend. So you've decided to go into business. Great.... Read More

Mistakes to Avoid in your eBay Auctions

Online auctions continue to grow in popularity as an easy... Read More