Drop shipping With Ebay
"Pitfalls of Drop shipping"
Today I want to discuss drop shipping with Ebay. Drop shipping is when a person sells a product and has that product shipped directly to their customer. Doing this allows someone to sell products without ever touching the actual inventory. This can save you a lot of money because your not paying any shipping fees. Starting a drop shipping business on Ebay can make you money, but I want to discuss a few things you should watch out for.
About a year ago I decided I was going to make some money with Ebay and do it with no money out of my pocket. Researching heavily, I found a drop shipper with products at astounding prices. I simply took these products and advertised them for sale on Ebay and overnight I made close to three hundred and fifty dollars. I took their name and address, went back to my drop shipper and purchased the product and had it delivered directly to my customer. I did have to spend the initial amount on the product but after delivery is confirmed you get everything back, plus any profit accumulated. Paypal will release your funds as soon as the item is delivered. This seems all too easy, but there are things to watch out for!
With Drop shipping, there is a fine line when it comes to your gross profit margin. It all depends on the price you paid for the product and what the return would be. In some cases, companies will offer wholesale discounts if purchased in bulk, allowing room for a better profit margin. What people fail to take into consideration, is the fact that Ebay and Paypal have associated fees as well. They dive in and realize that by the time they pay all the fees, their gross profit margin was almost nothing! Watch out for these fees! Take them into consideration!
The second thing you need to watch for is, unhappy customers. The reason I say this is because you never get to physically see the product. Make sure you trust this company before doing any kind of business with them. I used www.dhgates.com and I did have a few issues. One, they sent all my customers the wrong chargers. I sold the Nintendo Ds, but when my customer got his product the charger doesn't even plug into the wall, anywhere in this country! So be careful about what your offering for sale and be as accurate as possible when giving product details to your customers.
When the customer is unhappy, they tend to want their money back! This poses a concern because now you will have to go back to your drop shipper, ask for a refund, wait a month and piss your customers off! The really bad thing about this is that the fees Ebay and Paypal charged you when making the sale, will still have to be paid even if it's returned. So, now you have a returned product that has costed you money!
Thanks for reading! I hope that that this post will save someone a lot of headaches and money. Ebay is a business, plan it out before diving in! There are a lot of different opportunities for you to make money online. Visit the Home Business Guide for more info on making money online from home!
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