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.

In The News:

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Portugal to launch second 700 MW solar auction in January  pv magazine InternationalWhile preparing for the country's first, 1.35 GW solar tender in June, state secretary for energy João Galamba has revealed another procurement exercise will be ...
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Ex-library Harry Potter book predicted to sell for £30,000 at auction  Independent.ieA first edition Harry Potter book is set to sell for around £30000 at auction, despite signs of wear and tear.
One Lousy Treasury Bond Auction Doesn’t Say Anything  BloombergThe U.S. Treasury Department sold $27 billion of 10-year notes on Wednesday, and by one important metric, it drew the lowest demand in a decade.
Pair of Yubari melons fetch record ¥5 million at season's first auction in Hokkaido  The Japan TimesA pair of specially grown hybrid melons cultivated in the city of Yubari, Hokkaido, fetched a record ¥5 million ($45500) on Friday in the season's first a.
Neil Armstrong's Son Recalls His 'First Man' Dad as Apollo 11 Items Go Up for Auction  Space.comThe personal and professional legacy of Neil Armstrong show clearly in a new set of items for sale at Heritage Auctions. Read an interview with his son, Mark ...
Now scarce social housing is being flogged off at auction by councils desperate to stay afloat  The IndependentIf hospitals deliberately spread disease, it would be a scandal. But with an acute housing crisis, local councils, housing associations and other public bodies are ...
Late auction house leader DuMouchelle had keen, expert eye  The Detroit NewsServices are next week for Lawrence DuMouchelle, who has appeared on 'Antiques Roadshow'
Vocus board considers auction as takeover approaches fly in  The Australian Financial ReviewTelecommunications company Vocus Group has received a number of takeover approaches and its board is considering whether to run a formal sale process, ...
Foundation launches end of season eBay auction  Newcastle UnitedKit worn by the Newcastle United players during the 2018/19 season is among items being auctioned off to raise funds for community projects across the North ...
Nearly 28,000-Square-Foot D.C.-Area Home to Hit Auction Block  Mansion GlobalA 27,256-square-foot chateau in the Washington, D.C., area is headed to a live, on-site auction next month with no reserve. Most recently asking just under ...
Most expensive cars ever sold at auction  AutocarClassic car prices have gone crazy, but if you thought old Fords and 80s hot hatches were costly, they're small change compared with these...
Chennai civic body set to auction 2,400 abandoned vehicles  Times of IndiaCHENNAI: The corporation along with traffic police had last year announced that vehicles abandoned along roads and footpaths should be removed, failing ...
Special delivery: Rare postbox among items at Sheppard’s auction  Irish ExaminerA rare postbox is among intriguing lots, writes Des O'Sullivan. AMONG the real rarities at Inside Outside, Sheppard's auction of garden sculpture, architectural ...
Mouton Rothschild 'Versailles' cases fetch $2.7m at auction  decanter.comSeventy-five limited edition cases of Mouton Rothschild wines have been auctioned for $2.7m, with proceeds going to Versailles and Notre Dame...

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