How to Run an eBay Dropshipping Business

What is eBay dropshipping?

Before we dive in deep into the topic of eBay dropshipping, let me give you a brief idea on dropshipping in general. It is a simple and straightforward concept of buying products at a low price and selling at a higher price to gain profit.

Find a business that sells products of your choice or niche you’re interested in and work out a commission deal for each sold item. When the merchant will receive your order, he will also fulfil it shipment of the item on your behalf, which makes this a win-win situation for both parties.

I’d like to give a real-life example to illustrate the benefits of dropshipping further; I have a student who works with a bicycle shop owner who is willing to pay him $400 for every electric bicycle he sells. Today, he manages to make $2,000 every month just by working with this one supplier.

What could ever go wrong?

I believe that people rarely talk about what could go wrong in the world of dropshipping business. However, things DO go wrong and my best advice would be to communicate well with your suppliers. Here is another real life example that happened to me when I failed to understand my supplier and how they operate their business.

I was selling a swimming float on my eBay store and I was so excited that I am crushing it with 20 plus orders in mere one hour. Only later on, I realised that my supplier could not actually fulfil all my orders and the shipment for this product could take up to 2 weeks to arrive.

I was left with not much choices - either to cancel my unfulfilled orders or to find another supplier to fulfil them. I chose the latter. My customers come first and I wanted to provide the best service I could. However, I still ended up losing a few hundred dollars with that supplier. This is the real world dropshipping game - you will definitely lose money from this business if you don’t know the rules of this game well enough.  

The roles of an eBay dropshipping business owner

Recently, many people started a dropshipping business as a part-time job and that is absolutely fine. I started off my dropshipping journey pretty much the same and naturally, we would want to test whether the new business opportunity really works for us before we fully submerge both of our feet into the water.

Whether you’re starting out on a part-time or full-time basis, you will have to establish your mindset of a “business owner”. You have to look at the long term gain and ongoing effort to grow your dropshipping business.

As a dropshipper, the real value you're providing here is the visibility increase of the products you sell to your customer. When buyers search for the item that they want and your job is to put it right in front of them at the right time, with the right price and offer excellent customer service support to get a sure sale.

From my experience, if customers feel safe and comfortable buying from me, the price will be a secondary consideration for them.

Gaining customer loyalty is highly impactful as well. Your buyers will always feel more appreciative when you send them a thank you message post purchase, a product tracking number and a positive feedback at the end of the transaction, reminding them of your good service.

All of these little gestures will boost their trust and confidence in dealing with you in the future. Your number one priority is to fully serve them to their satisfaction and eventually they will become your most loyal customers who will create repeat business.

Working with suppliers

All businesses have their own unique challenges. My past experience on working with suppliers taught me one thing - you have to diversify your suppliers and have at least 2 backup sources for the same product you sell. When sourcing multiple suppliers, you may find it useful to check out Salehoo's supplier list.

In eBay dropshipping business, you will have to work towards the end goal of owning your own range of private label products. In the meantime, learn as much as possible and don’t be afraid to test different strategies.

Some of my existing selling strategies are derived from my suppliers' recommendations. Don’t you think that the suppliers may be more familiar in terms of which products sell better aside from your own research.

Suppliers handle thousands of orders daily, they have the necessary insights you need so that is your golden mine - use it! Best of all, it’s free information you just have to ask them. Make friends with your suppliers. Make more human connections!

Running promotions

Like any business, you have to market your products to increase sales. eBay marketplace is a huge platform and your product listing can be easily buried underneath all the other listings.

Hence, it is be necessary to do product promotion for your eBay store in order to give your customers reasons to buy from you. A discounted offer always works a long way but offering similar items or other cross-product promotions can actually increase the number of your sales.

Test all the promotional tools that eBay offers on its platform. Those tools are very helpful to drive up your sales. If you take full responsibility of your sales and are seriously keen on turning this into a full-time basis, then you have to put in all the necessary work.

Outsourcing your daily work

Running your own store will be overwhelming at times, and that’s perfectly normal. All business owners will have to go through this so your role as a business owner is to understand when is the right time for you to outsource your daily operations.

My point of reference is based on simple math - when profits can pay for all expenses. At breakeven, you should start outsourcing your business operations. Remember, your new role now is to manage your business to maximise its’ growth potential.

Many new dropshippers make a mistake of asking a wrong question, “How can my team help me grow and scale my business?” This is not just a wrong question but a wrong mentality of pushing away your responsibility.

This is where most people begin to give up when they don’t see any success after building a team to run this business. Your role is to empower and lead your team of employees so that they will have the sense of belonging towards your company.

No one can grow your business for you, except you. Your immediate role is to learn and apply new strategies of growth into your business.

Staying in the game

If you’re still reading this, I bet you’re facing difficulties with your eBay dropshipping business and I hope my experience provides you with good food for thought in order to stay in the game of dropshipping.

 

Let me guess, you are probably struggling with daily issues with eBay algorithm changes, softwares causing you problems and low profit margin that doesn’t justify the amount of work you put in?

The actual problem is you’re too impatient and too eager to see result. If so, I would say that dropshipping is not for you. Most people who sell you the idea of making quick and easy money from drop shipping are lying to you. It’s a real business and investing your time, effort and lots of hard work is a must.

Is there any day that I feel like giving up? Of course, yes! You probably have this voice inside your head telling you to give up and it’s not worth the time. Well, you can choose to just give up. Success is truly a choice and a decision to be made.

You have to stay in the game by connecting with real people doing this and by joining different dropshipping communities. In every business industry, only the top 1% makes good profit in a way that’s automated, so it becomes effortless. Not because they are lucky but it's because they stayed in the game long enough and persevere to get to the top to win.

Only when you take the responsibility of your business it will be improved and thrive. The question is: “Are you challenging yourself everyday?”

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