Many businesses have existed on the internet for years, providing services to consumers that don’t want to buy in bulk or who don’t have the time to go to the store. This model of e-commerce has completely revolutionized the way that many brick-and-mortar businesses operate, and has also altered the consumer habits of most shoppers. Many people now check online to find the best price before they go to the store. Some online businesses offer their own products, but what about businesses that offer other businesses’ products? The art of dropshipping is just that, and we’ll discuss the basics of how some people make a full-time living through the act of selling products they don’t own.

eBay, A Platform for Dropshipping

You have probably looked on eBay at least once in your life, and many people buy products through the online auction powerhouse. If you buy regularly from eBay, then there is a good chance that you have purchased a product from someone who didn’t actually own it at the time. How dropshipping works is that the reseller of the product lists the item. The consumer then purchases the item, and the money is deposited (in eBay’s case) into the reseller’s PayPal account. From here, the reseller will turn around and purchase the item from their source, have them ship the item directly to the consumer, and pocket the difference. In many cases, eBay listings are merely dropshipped goods that are shipped by a third-party that has nothing to do with the listing of the actual item on the site.

How to Begin

Before you start pinging users with a variety of auction listings, you’ll need to take a few precautions. Of course, you’ll need to set up an eBay account and a corresponding PayPal account for accepting payments. After this, you may need to arrange with eBay an increase in your buying and selling limits – you can do this by contacting the website directly and inquiring about what is needed to expand your offerings. Some accounts come with small selling limits, while others do not: there are algorithms that seem fairly random in how this is initially assessed. After you are ready to go, you’ll then need to track down a variety of dropshipping companies via the web that can provide the service and products that you wish to sell. Last but not least, you’ll need to do research in order to find which products you can sell on eBay and still make a profit.

Other Considerations

Ebay and PayPal fees will equal anywhere from 6 to 10 percent of your total sales price. This means that the upfront price you see isn’t necessarily the total profit. You’ll also have difficulties if you have a customer who complains about the product they receive; if it is broken, non-functional or otherwise not what they expected, do you have a plan to handle the returns process? Also, eBay and/or PayPal may take notice if you suddenly begin pinging users with dozens of listings, and subsequently flag your accounts for review. Because of this, we recommend that you gradually build a business model that is sustainable, instead of jumping in all at once.