How Does Dropshipping Work on Ebay? Beginner’s Guide

selling things on ebay seller supplier buyer

For those who don’t already know what “dropshipping” is… Basically it is a business strategy where you sell things you don’t currently own or have in your possession, instead you have a supplier where you can go buy the item from for a cheaper price once you make a sale, thereby making a profit from the difference.

Different Ways to Operate a Dropshipping Business

Some people build a brand/website and sell in a specific niche, but this is very difficult to do for a beginner since you’d have to know about website building, you’d have to think of ways to bring in traffic, invest money for marketing, etc  There is a much easier way to do dropshipping, we can do it on Ebay!

How Does Dropshipping Work on Ebay?

Since Ebay is the biggest selling platform in the world of ecommerce and has the most traffic and therefore buyers, if we’re going to be dropshipping then it is most profitable to be doing it on Ebay.

The Process is Simple:

Step 1: Find a Supplier
Step 2: List Products From Your Suppliers’ Website onto Ebay with a Markup Price
Step 3: Once the Product Sells on Ebay, Buy it From Your Supplier & Send it to Your Ebay Customer

First you’d need to find a supplier. This is where you’ll find products that you can list on Ebay with a markup. So for example, you have a supplier that sells a TV stand for $50. You take your supplier’s listing info, including the title, pictures and descriptions, and you post that same information on Ebay, the difference is you’ll be selling it for $75. Once your item sells on Ebay, you go to your supplier and order the item to your Ebay customer’s name and address, and you pay your supplier the $50, and the $25 difference is your profit! That right there is dropshipping.

How to Find a Supplier?

I know this part is where some people may hesitate because they’re not sure how to find a good supplier. They think they need to set up some special relationship, do some secret handshake, set up some special dropshipping deal with a supplier, negotiate on the phone and all that complicated stuff. No. (Although you can do that if you want. But there are better ways…)

Here are some suppliers that anyone can use, no special privileges or secret hook up required. 

  • Walmart
  • Amazon
  • Target
  • Overstock
  • Home Depot

These are large online retailers that anyone can just go to and order from. You don’t need some special dropshipping account or anything, just go there and order, that’s it! I personally use Walmart the most because they ship really fast and have 100’s of thousands of items I can list.

Does This Really Work?

Once you realize how easy dropshipping is, you’d think it’s not going to work, because it’s so darn easy. You’d think there must be some kind of catch, but I’ve done it for a few months now and so I can tell you honestly from personal experience that it totally works! I’ve listed over 1000 items from Walmart onto my Ebay account with a marked up price, and people actually do buy it at that price from me. Lots of people do it, I think I’ve read somewhere that around 75% of sellers on Ebay are dropshippers, but don’t quote me on that.

Why Would Someone Buy it at a Higher Price?

A very common question is that if you’re sourcing your products from Walmart or whatever and then just selling it at a higher price on Ebay, then why the hell would anyone buy it from you on Ebay? Why wouldn’t they just buy it from Walmart themselves?

The answer is simple. It is because many people simply don’t shop around. They just go to Ebay and find whatever they’re looking for at whatever price they’re willing to pay, and then just go with that. They don’t price check and compare at all these online retailers and buy it from the cheapest source. Although there are people who do price compare like that, there’s enough people who don’t for this strategy to be hugely profitable.

Potential Dropshipping Problems

Although dropshipping is simple and easy to do, there are countless of problems that will inevitably come up and you’ll have to deal with. For example you’ll occasionally make a sale on Ebay only to find that your supplier is out of stock or that your supplier’s price has increased…making your sale no longer profitable. This is a common issue and there are ways to avoid it such as having a price tracking software which adjusts your pricing on Ebay accordingly to ensure you stay profitable.

You’ll also have to deal with returns, exchanges, angry customers, and other annoying things that are all part of the game.

Final Thoughts

Dropshipping is a great way to make money from home on your computer. This is a business where the startup costs are extremely low, you don’t need to buy anything, no inventory, no warehouses to store them, and you can do this anywhere with an internet connection.

Although a number of problems can arise while operating a dropshipping business on Ebay, there is always a solution to each problem. The question is not whether or not you can make it work, it’s whether or not you’re willing to find a way to make it work.

Be sure to check out other posts on my blog under the Ebay Dropshipping menu for more information on how to deal with these problems. I am constantly updating this blog, so check back often as more information gets added every week. 

2 thoughts on “How Does Dropshipping Work on Ebay? Beginner’s Guide

  1. Megan says:

    Wow – I never really understood this before. Thanks for your explanation. I may even give it a go one day. You make it sound easy enough…

    • Kent says:

      Id suggest you look up “no BS dropshipping” channel on youtube. I learned 99% of all drop shipping related stuff from this guy.

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