Well, “Should You Start a Drop-Shipping Business On eBay”? The short answer to that question is…it depends on your goals. eBay can be an awesome Platform for you to start a Drop-Shipping Business. If you just want to make some extra money, then a Drop-Shipping Business may not be what you really want. However, if some good extra money is what you are looking for, then I’d give it a full, 100% shot. (Personally, I’m still running my eBay Stores). Now, if you are really wanting to start a “Real Drop-Shipping Business”, then maybe you should look toward other Platforms before jumping into eBay. WAIT! Don’t get mad yet! When I say a “Real Business”, I’m talking about one where you would need some or all of the following:
- A Business Card,
- A Toll-Free Phone Number
- A Virtual or Physical Address
- A Post Office Box
- A Local Phone Number
- BBB Credentials
- Clients
- Office Space
- Employees
- An LLC/Corporation/DBA
- Etc…
- Also other businesses that may require Licenses, Permits, Inspections and Approvals…just to name a few.
One Quick eBay Story
I’ve been on and off of eBay since about 1999. My Wife and I used to have a Mail-Order Business. You know, we used to “Stuff Envelopes” and had them all over our small Apartment, in the early 90’s. We were Drop-Shipping back then but didn’t really have that vision of what it has become today. We used to advertise in the Newspapers from all over the Country. Most of the time, we’d stuff envelopes with our sales material and lick these Address Labels to paste them on the front, and send them to people who were most likely to make a purchase from one of our offers. We’d purchase these names and addresses from some Mailing List Company and we really did get checks in the mail (Checks in the mail for orders = Mail Order). 
(Today, there’s very little “Orders by Mail” but we still get our “Orders in the Mail” and mostly by this tiny, little company that you might have heard of. They’re only the world’s largest Drop-Shipper and Online Order Specialist, called….AMAZON!) Soon, we heard about this thing called Drop-Shipping, and kicked off our Drop-Shipping Business by selling Books through the mail. Our Drop-Shipping Company was a Company out of North Hollywood, Ca, called Melvin Powers Book Company. It was awesome! Later, we kept on seeing this TV Infomercial about a company, who was making available to us, THOUSANDS OF ITEMS, that we could offer to our customers, and this company would Drop-Ship for us when we made a sale.
This company was out of Chatsworth, Ca and it was called SMC. Specialty Merchandise Corporation. You may have seen those old Infomercials with Tom Bosley (Mr. Cunningham from the 70’s TV Show “Happy Days”). I remember coming home from work one day and my Wife asked me if I heard of this new company called eBay. I didn’t. Did some research, got an account, sold some items, and I was hooked! We both were!. Forget “Drop-Shipping” and “Mail-Order”, eBay was easier, faster and we got rid of a lot of stuff….It was more of an “Instant Gratification”.
The Emergence of eBay and Drop-Shipping in 2018
There’s a “Big Boom” going on now with the emergence of eBay and Drop-Shipping. I first took notice of this trend about 2 years ago because a friend asked me one day about Drop-Shipping, and I told him it sucked!… All because of what I had gone through in my early dealings. How I purchased courses, built a few websites, listened to lots of Audios and watched a lot of videos and blah, blah, blah. After telling him those things, I, once again, became curious. LOW AND BEHOLD, It seemed like everyone was doing it. I just had to get back into it and, at the time, I was really focused on Real Estate Investing while also learning Real Estate as an Agent.
I started my Corporation and still had my eBay Store going at full blast. Yet I decided to take some time to slowly start and build my own Drop-Shipping Store, but not on eBay. I’m using a Platform called Shopify. Well that’s another subject, but if you want to know more about Shopify, the Shopify Platform, and about Shopify Drop-Shipping, then click hereI
Anyway, I’m sure that there are multi hundreds of thousands of people who had dreams of “MAKING IT BIG” by Starting a Drop-Shipping Business on eBay. People who had dreams of quitting their JOB and living that “Laptop Lifestyle”. A lot of people have actually done it though, and yes, you can as well! With Drop-Shipping on eBay, you don’t need to have a product of your own…and this is the main appeal for this type of business. OF COURSE YOU ALREADY KNOW THIS! You’re wanting to know if you should start a “Drop-Shipping Business” on eBay.
So the Question Remains…..Should I Start a Drop-Shipping Business on eBay? The Long Answer
No one can answer that question “Should I start a Drop-Shipping Business on eBay” but you! You are the one who would have to prepare all of the Listings. Depending on what you are selling, you may have to take lots of measurements and/or weigh a lot of items, along with taking good quality pictures of course. Can you start one, yes. Is it legal, sure it is! I do have my reservations with the idea of “Drop-Shipping as a Business” on eBay, and here’s why. I believe that when you run a business, you need to be in control. Running a Drop-Shipping Business on eBay, gives you very little of that.
8 Reasons why I don’t want to Start a Drop-Shipping Business on eBay
#1 – eBay doesn’t like it. Buyers complain and cancel orders because they haven’t received their items after 5-7 days. So, for example, if you’re Drop-Shipping items from say China, the ePacket shipping is 12-20 days (or longer). You would have to disclose this point. Most people don’t pay attention to this. They just see the Price and the Free Shipping Icon, and their sold! Afterwards, they want to cancel the order, leave negative feedback and blame eBay for the entire situation. This gives eBay a bad name. Besides, do you really think they want to return their Listing and Final Value Fees back to the customer? Not to forget to mention that they own PayPal, and have to return those fees as well. So they frown upon it.
#2 – If you live in the United States and your Drop-Shipper is overseas, again, you’d have to disclose the items’ location and shipping times. eBay will prevent you from listing that item, as they really want you to be in possession of it…and so do your customers. I see that some people have listings where their location is in the US and the items are in China. This is most likely allowable because that seller may have told eBay that they have an office there and in the US as well. I don’t know. What I do know is this. If eBay finds out you’ve lied to them…..no more account….no more business!
#3 – You don’t have the luxury of having control of your customers. Sure, you make one sale, you get their email address, but you do not have permission to email them “Outside” of the eBay Platform. When you have your own website, you can have a form that asks your visitors to Join, Sign-Up or Opt-In with their email address. You should also let them know that you may be sending them something. Then you will, at that point, have control of the communication channel between you and you customers of visitors.
#4 – When using Drop-Shippers on eBay, you always run the risk of, making a sale, and your supplier has run out of stock. So you will always need to have backup suppliers for the same item when in the time of need, and hope that they will have your item ready to go. (I just went through this very thing with my own Drop-Shipping Business).
You must establish a good relationship with several of these Drop-Shipping Companies. On a $1000 item or total sale, you may have to come out of the pocket with some money before that supplier trust you and ships it to your customer or buyer. So your initial success depends on the price of the item and the supplier, so be prepared. If, however, you have established that relationship, you keep a close eye on the inventory of your suppliers and the suppliers are local, then you may have a very good reason for doing this. Items in stock, high quality pictures, excellent descriptions, fast shipping times, EQUALS SATISFIED CUSTOMERS!
#5 – Drop-Shipping as a Business on eBay may leave you with very little profit margins, if any. Thousands of people use Drop-Shippers. Thousands of people offer the same items from these same Drop-Shippers. You’d have to price it lower than the next Seller to make the sale. After all of the fees, what do you have left. The eBay Fee Calculator sucks. You can see for yourself by clicking here, or copy and paste this address: ebay.com/feecalculator. A better calculator can be found here or by copying and pasting this address: finalfeecalc.com
#6 – One good thing about Drop-Shipping as a Business on eBay, or any Platform, is that if done right, you’d really have very little risks, financially or otherwise.
In a typical Drop-Shipping Scenario;
- The item would be purchased on eBay, meaning it was paid for and usually via Paypal.
- You go to your suppliers website and order that item via the same paypal account (or at least with the Funds that were deposited when the purchase was made).
- When placing the order, make sure the “SHIP TO” address, is the address of your Buyer and asking “YOUR’ Seller, not to include any Sales Material or Invoice. This is called “Blind Shipping”.
- You’d then keep the difference in price as your profit. When your Seller sends you the Tracking Number, you’d copy and paste it into the message box, straight to your Buyer. No expenses, only time and profit!
#7 – Since eBay owns PayPal, PayPal can put a freeze on your account for up to 21 days or longer, if you are new and/or are experiencing long shipping times or are experiencing a large Dollar amount being deposited into your PayPal Account… You just may find yourself paying for the items ahead of time, which is not the ideal Drop-Shipping Scenario. Suppose you were selling $500 PlayStation Systems. 20 orders came through in the last hour paid to PayPal. THAT’S $10,000!
What if your Drop-Shipper or Wholesalers price was $200 each or $4,000 total, and PayPal put a freeze on your account for 21 days. Where will you get the money to pay your supplier or shipper? This is a question to ask yourself, whether you’re Drop-Shipping on eBay or not. This really is something to always consider and have an answer for it if needed. So be careful! If you want to make a sale here and there, a lot of people do what I’ve Tagged, Drop-Shipping Retail Arbitrage. Here’s my definition…well, I’ll just use an example;
- You find an item over at WalMart and it’s on clearance for say $40.
- You do a search on eBay and find that the same exact item is “Selling” for $80.
- You’ll then list that item on ebay at a price of $70 for a quick sell.
- Once it sells for $70 and paid via Paypal, you then order that item from WalMart for $40 and have WM ship it to your buyer.
- You keep the price difference ($30) minus selling fees and/or shipping fees.
- You didn’t hold any inventory nor ship any item.
- Find and sell 10 items in a week, and that’s an extra $300 or $1,200 per Month on average.
#8 – The problem here is this. When your buyers get the item in the mail, guess who’s name will be on the package…it’ll be WalMarts name. WalMart will have an Invoice with their Logo and include their Sales Material, It will then be another WalMart Customer and not yours! This goes the same for other Companies like: Amazon, Wish.com, Best Buy, Target, Home Depot, K-Mart Sears and so on… (I’ve made purchases from eBay and re-sold on Amazon at a much higher price and vice-versa, in the past, but I’d always do my own shipping and incorporate the shipping price in the total payment or sales price).
Sure, you can go to any one of those places and get great deals and resell them as a Business Model if you ship them yourself…then it wouldn’t be called a Drop-Shipping Business. It’ll just be called Retail Arbitrage and the shipping prices you’d have to endure will eat into your bottom line, unless you’re just wanting to make some extra money….then it’s okay.
My Conclusion
It’s okay to have a Drop-Shipping Business on eBay, as long as, you do your due diligence. I’m just putting it out there. So there you have it. If you want to receive additional Tips, Tricks and Ideas, as well as, Fresh and New Information relating to your eBay success, that may not be posted on this Blog. Then be sure to type in your BEST INFO below…You won’t be disappointed.
So there you have it. Are you ready to START A DROP-SHIPPING BUSINESS ON EBAY? Then keep it simple, take your time and learn as you go.
I hope this post on “STARTING A DROP-SHIPPING BUSINESS” , has pointed you into the right direction!
If you want to receive additional Tips, Tricks and Ideas, as well as, Fresh and New Information relating to your eBay success, that may not be posted on this Blog. Then be sure to type in your BEST INFO below…You won’t be disappointed.
Notes and Disclaimers:
Unless otherwise mentioned, the views and comments made within this particular Article, are/were solely made by it’s Author….Mrstoney. Mrstoney is not an Attorney nor does he pretend to be one or play one on Television. 
Therefore, the information that was made available within this Article, was for informational purposes only and not for the purpose of providing “Legal Advice”.The information that was given, was based on the Information, Expertise, Training and Experience obtained by the Author. If you believe that “Legal Advice” was given, even if accidentally, the Author would remain harmless for any actions taken, based solely on the information within this Article. You should contact your Personal Attorney to obtain His/Her advice with respect to any particular issue or problem. Use of and access to this Blog, Website, Page or Post or any of the e-Mail Links or Communication contained within the Site or Article does not and will not create an “Attorney-Client Relationship” between the Author and it’s readers. The opinions expressed here or through this site are the opinions of The Author, Mrstoney, and Mrstoney only, unless otherwise clearly stated.
Highlighted Links
Amazon Wish.com Best Buy Target Home Depot Kmart Sears eBay ebay.com/feecalculator Finalfeecalc.com Shopify.com PayPal Walmart