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Drop shipping on eBay – What's the story?

Drop shipping on eBay – What's the story?

Are you allowed to drop ship on eBay? Does eBay have any specific rules for drop shipping? Confusion abounds, so we’re here to clarify what’s the go and what’s not.

eBay does allow restricted drop shipping, they refer to drop shipping as ‘pre-sale items

Here's the gist:

  • The seller must guarantee that items are shipped within 30 days after the date of purchase, and state this guarantee in writing.
  • The seller must clearly state that the items for drop shipping are ‘pre-sale items,’ and the text of this advisory must be prominent, and not be smaller than HTML font size 3.

Penalties for violating this policy include: Listing cancellation, limits on account privileges, account suspension, forfeit of eBay fees on cancelled listings and loss of PowerSeller status.

Sounds tough! Is it actually profitable to drop ship on eBay then?

Sellers clash on whether or not drop shipping works. Complaints against drop shipping include:

  • The seller does not have control over inventories
  • Items shipped may not be exactly what has been listed
  • Margins are often small, and sometimes simply nonexistent in some eBay categories

On the other hand, here are some positives:

  • The seller does not have to stock up on products, saving on upfront and storage costs
  • Sellers can sell what they want, when they want, where they want
  • Drop shipping simplifies the business process, eliminating costly handling requirements

And while many sellers gripe that “reliable drop shippers is an oxymoron,” success stories do exist. ToolKing makes USD 30 million in annual sales, and prides itself on having the most comprehensive product selection online.

The secret to their success? Drop shipping. Toolking works with 30 manufacturers who drop ship 25% of their orders, and account for 30% of sales. But success did not come easy; they had to learn the hard way that successful drop shipping requires much work, time, and preparation.

Do you want to drop ship products from trusted wholesale suppliers? Join SaleHoo and get instant access to over 8,000 trusted and verified suppliers. 

40 Comments Add your comment
Drop-shipping is a great way to get started in a business or to expand your inventory where otherwise you would not be able to offer that product to your customers. Just make sure the supplier is reliable and maby carry a few products on hand in case the supplier has a problem and is unable to fulfill the order for one reason or another. This could help keep ebay feedback positive. Reply
Well, in any form of business, there needs to be some kind of hard work in the start. In this instance, finding the right drop-shipper(s) and forming a close relationship with them is very important (either give them a ring, meet up or do both!) The foundation has to be set solid for the success of such business or any business for the fact. Reply
I think your second bullet point is a little misleading. ("The seller must clearly state that the items for drop shipping are ‘pre-sale items,’ and the text of this advisory must be prominent, and not be smaller than HTML font size 3.") That restriction is ONLY for pre-sale items. It doesn't apply to any/every product you dropship. And in fact, not all pre-sale items are dropshipped, but most could be. I use some very reliable dropshippers who ship within hours of the order I place and have lot of great feedback because they ship what they advertise. I'm picky about my dropshippers. I also sell a lot of stuff myself, so it's not 100% of my business. Dropshipping is a nice way to build your online business, but it takes time and work. Reply
Oh, I just realized your first bullet point is also misleading. ("The seller must guarantee that items are shipped within 30 days after the date of purchase, and state this guarantee in writing.") That is true of EVERY item sold on eBay, it does not refer specifically to dropshipped products. I've sold for almost 4 years and I don't believe there are any restrictions at all on dropshipped products per se. Reply
Tammi, It seems you are established in eBay dropshipping. I understand people don't like to give out there wholesale sources. But, can you advise of a good company the helps with contacting wholesalers, that would be a good start ? I hear alot about Worldwide Brands and Salehoo.? Thank You ,Bill Reply
ebay has made it nearly impossible for newbies to get started selling whats hot right now. for example nintendo wii, ps3, xbox 360, iphones, blackberry's etc, etc. ebay considers these to be high risk items. they also happen to be whats hot right now and present great opportunity for newbie marketers to start making nice profit margins on large volume almost right away - if it were not for one thing - and that one thing is that ebay requires new sellers of these "high-risk" electronics and cellphones to only accept paypal as the method of payment. and paypal has it set up where they hold the buyers payment until the seller receives positive feedback or until 21 days has passed without there being any dispute. this eliminates the possibility of any newbie to break into the ebay scene by using dropshippers because he cant get paid until the buyer submits a positive feedback for the transaction. this has me perturbed because while i do not have the capital necessary to stock large quantities of iphones or nintendo wii i have secured relationships with dropshippers of these "hot" products. this marriage of paypal and ebay has me by the short hairs. i cant post an ad for wii because once i receive payment via paypal i have no way of of forwarding that payment to my dropshipper because paypal wont release the funds to my bank until the customer receives the wii and sends a positive feedback. so it puts the Kibosh on what woould be a very profitable -- VERY PROFITABLE-- ebay business with regard to selling video game consoles and high end mobile phones. my only option is to now buy 1 or 2 units at a time and sell them immediately and then wait up to 21 days for my money to clear through paypal before i can then go and order 2 0r 3 more items and then resell them. all the while i could be taking orders for 10-20 units per day and having them dropshipped and clearing the money in the middle to the tune of an easy 1-2k per day in profits according to what existing power sellers are already selling per day. and i could beat the best prices out there by an easy 10-20% so needless to say i am quite disheartened to learn that i must use paypal only after i have spent the better part of the last 3 months securing rock solid dropshipper/suppliers - now come to find out that i cant even use them because these items are considered high risk. why cant i just use my merchant account and accept credit cards????? i'll tell you why ... the incestuous marriage of ebay to paypal and the horrible policy about new sellers being forced into accepting the monopoly or going elsewhere. any advice? erik Reply
Erik, I am in the same position as you, although I do not drop ship. I have recently sold a xbox 360 on ebay, my customer has paid yet Paypal are holding the payments until the buyer leaves feedback or after 21 days has past there has been no claim from the buyer. I called Paypal last night and the agent called Miguel said he could not tell me why it was on hold as it was a security issue. I told him that it was my account and I have a right to know, and he said no i cant tell you. In the end i got very mad and put phone down on him. Paypal are useless. My question is what happens if the buyer does not leave feedback? I will then have to wait 21 days for payment - this never used to happen...I can understand why they are doing it but when you have been a member of ebay for years and use paypal constantly surely they would know me from a fraudster?! Reply
Erik and Jon, The same thing is happening to me. But the worst is that I never got paid for my only item that I sold on Ebay and I'm talking about a little over 2 months ago. It was a PSP. Reply
Erik, You can't find reliable drop shippers of things like the Nintendo Wii, Playstation 3, Xbox 360, iPhones, etc... Why? Because the profit margin is so so thin, that a dropshipping company can NOT profit from it, and you sure as hell couldn't either with eBay/PayPal's fee's. (Btw, eBay owns PayPal) If you find any of the above with a profit margin about 5%, then it is fake. Walmart, who has billions of dollars, can't even get deals on the systems, and only a small deal on the games. The "powersellers" who are selling these items are selling them as Used, or in packaged deals where they make a profit from extra accessories, such a Nyko's Wii Controller. Reply
Well, I'm sure you solved your problem by now, but I'm also sure this thread will be useful to others who are suffering the same problem. I hate it too, the 21 day wait period eliminates dropshipping on ebay. There are only two ways "around" this. You can get a business loan and stock your items so that your loan can be replenished on a 30 day cycle (after your funds are released). This might be secured with a vehicle, an SBA loan, or just a personal loan if your credit is good. The method I used is the one that nobody likes but worked quickly. I bit the bullet, took about $800.00, and bought a couple of lots of my item wholesale (be sure to check that your item has a high sell through rate on terapeak first). My items sold right away, and I shipped them for free and immediately to build a good DSR. I took all of my profits and just kept reinvesting them by buying, selling and shipping quickly. In about three months, Paypal lifted the 21 day wait period, and all of my payments are now immediately available on paypal! 90 days sounds long, but I can tell you, it is great to get my money right away. It also gives you time to make mistakes, refine your approach, and build relationships with wholesalers. This takes time, but if you get busy it passes quickly. By the way, sell the chinese phones. You can make $100.00 per phone! the only way you're going to make money on an iphone 4 is if you buy it outright for $600.00, unlock it , then sell it on Ebay UK for $900.00. Best, Ed Reply
Site Admin
@Edwin Harris: Thanks for the tip and for sharing your experience! It is well appreciated! :) Reply
I am thinking about getting into this business, but while reading these posts, I've become a bit hesitant now. I fear losing tons of money. Plus the competition out there amongst the big sellers is astronomical. Any words of encouragement? Reply
I would like to know if i would get descent suppliers at salehoo who would ship items to brazil? Reply
Site Admin
@Gina: Hi! You haven't even started and yet you're already giving up. Remember that all those big sellers started out small and I bet during their time they too had competition to muscle through. Don't be afraid to take a step forward - start small, maybe you can start selling a few old things from your house just so you can get the hang of it,like practice :) This way you don't need much capital and you get the chance to experiment which template works best for you or how best to take photos of your products. Also, consider selling something you are passionate about, its oftentimes easier to promote/sell something we love and enjoy. Feel free to read through our guides and blogs. The best of luck! @jon: Hello! Yes, we have suppliers that are verified to be safe for use and will willing ship to Brazil as well as to most destinations worldwide. If you're ready to join SaleHoo please go to, http://www.salehoo.com/join-now Cheers to you both! Reply
Since paypal hijacks the money from the buyer for 21 days, there is no way to beat this at all. What shall we do? Sell one "hot item" every 21 days? Wow, my income will soar to approximately $100 a month! Is it necessary for Ebay and/or paypal to be told we are using dropshippers? If so, then what about selling on CraigsList? They have just as much, if not more traffic than Ebay does anyway. Would the 21 days paypal hold still be mandatory if I sell on Craigslist? I had a bad feeling about selling on Ebay. Everyone makes it seem worthwhile, but apparently its not worth anything unless you can sneak behind their backs and use the dropshippers, or have enough money to maintain your own inventory, which I do not. I am a divorced, and disabled mother of two children. I have been searching for months and months for a way to earn money online, and each day I am sadder than the day before. I did not know anything about this 21 day hold, and I did a lot of research regarding Ebay. I am so grateful to you all for this very important information. This knocks me right out of the box, and $200 poorer. God Help Us All. Reply
I have looked into selling on ebay and have also discovered that paypal holds your money. But I was informed by paypal that they only hold your money if you have a low score through ebay. They will release your funds if you send them a tracking number to confirm the item has indeed been shipped. Now I do not think this applies for the high risk items. I recently started listing things around my house to sell so I can get the membership fees for salehoo. That way I am not actually taking money from my monthly budget. I feel if you are dedicated to starting an online store through ebay it will be successful. Reply
i do a drop-shipping review on my website, if you find a good drop-shipper you can make a lot of money on websites such as Ebay, and the smaller ones. think niche low competition that caters to a specific market. That’s how you can make a nice 2nd income from home using the powers of dropshipping. Great blog, useful tips! Reply
Hi
I'm a newbie to this and am currently setting up a shabby chic ebay shop and wNt to buy wholesale or have drop ship items for my sales. It's my hobby too as I do up small pieces and sell on . Any ideas and advice most appreciated.
I've paid a company to help me set it all up, don't ask how much as I'm now thinking I've been ripped off. Point is, I need it to work now as I lost my job and have to support my two children.

Thank you for your help and please go easy as feeling down now after researching it all in more detail. My web guy said it was a good solid business idea.

Reply
Full Member
Hi,I am a Korean.I am sorry I can't speak English a little.
I wonder if you are doing dropshipping now.
I also want to list the product from various wholesale site. but what kind of items do list ? what's the profit of the item ?
Could you know the way of dropshipping ? Reply
Site Admin
Hi there --

I recommend checking out our drop-shipping guide. It should cover everything you need to get started.

http://www.salehoo.com/dropship
Free Member
Selling on ebay can be easy for those people who sell quality products. I have a list of items that I sell, but I clearly provide quality products that customers are eager to receive as the item displayed is the same as when the customer receives it. The picture of selling a product can illistrate a much easier sale if the picture is a quality picture. Rmember, people can only visualize what a product looks like when they observe a picture. When they receive the product it must display the same look as it was illistrated in the picture to the customer. A product that has quality will always sell no mater who the customer is. Quality, ontime delivery, satisfaction= a sales. Reply
Hi, I am a new seller on eBay and I received the payments on Paypal next day, and it so simple to me. I love eBay and makes profits $200 in profits the first day! Good luck to all!!! Reply
Good for you, Mimi. You are a new seller and you don't know it all YET! I have been a Power Seller from 2007-2010 with 99% positive feedback rating and got suspended when I found a golden goose product last December which made my income soar from $100.00 a day to $2,000.00 a day. I made so much money that enabled me to just stay in the house and not do anything up to this date. I was just a nanny and I was caught off handed by the demand. I hired people to help me pack and ship and tried our best to catch up with the demand to no avail. I ended up getting suspended and Paypal held my money for SIX MONTHS, huge amount of money. Bottom line is - eBay and PayPal suck. Now, I am up again via my website sales and now I am very much interested in investing in Salehoo. Reply
Free Member
Hi, just reading through all the comments and are curious what is a pre sale item? I am referring to drop shipping items. I am also unsure if perhaps I have misunderstood the above comments however am I correct in that PayPal will not release your sale funds if a positive comment has not been made within 21 days? regards Denise Reply
Site Admin
Hi Denise: The money may be released sooner than the 21 days hold if yes, your buyer leaves positive feedback OR if PayPal can confirm that the merchandise was delivered and 3 days have elapsed. Learn more at https://cms.paypal.com/us/cgi-bin/?cmd=_render-content&content_ID=security/paypal_holds_faq As stated in the blog, products for drop shipping will fall under eBay’s policy on pre-sale items. Products which are not in your possession will fall under /are called 'pre-sale' listings. - These items must be shipped within 30 days from date of purchase - It must be clearly stated in the listing that the merchandise is NOT in your possession, and that it is a drop shipped or pre-sale item. :) Hope this helps. :) Reply
I am confused as to why people are using the terms "drop-shipping" and "pre-sale items" interchangeably. They are not the same thing. The Policy page on Ebay is very clear that "pre-sale items" are products that have not yet been released --->to the public Reply
Estou querendo comerçar a vender no eBay mas não sei como comerçar alguem pode me ajudar? Reply
Site Admin
@ audeci: Temos guias sobre como vender no eBay aqui - http://www.salehoo.com/education/ebay-selling porém eles estão no idioma Inglês apenas. Reply
Amazing how old some of these comments are and people are having the same problems today. I guess when any company becomes the big gorilla in the room-out goes good quality service. Have a great day on purpose! Reply
Hello! I'm new here, actually, not yet signed up. I am looking for suppliers of shoes for women, and was wondering if I can find that site when I sign up? My main intention in joining this community is, because I work as dropshipping here in Brazil, on my website. Do you have lists of suppliers? Thank you! Reply
Hello everyone, I'm just wondering if we use that dropshipping,how about the seller name when ship that parcel? Do we use our name or use that shipper'c name? thank you.. Reply
Site Admin
@Thomas You can arrange with the dropshipper not to reveal their name, or to ship using your business name, to drop ship blind, because if you provide your source they can go directly to the drop shipper and will see the products in their prices, without your markup. Reply
We sourced a good local supplier of handbags who does dropshipping and when we opened eBay account and shop to list items, we were told that we were restricted to 10 items but that if we ring business team to discuss our business plan, and confirm our address with eBay, our total listing would be lifted to 100. When we spoke to the business team today they said they discourage dropshipping on eBay and our totals will not be lifted whilst we dropship. So we are stuck on 10 listings per month. To increase this listing hold, we have to hold stock and to prove that they asked us to send an invoice to them showing 100 items. Therefore it seems it is impossibe to drop ship with eBay. Reply
eBay business Centre told me on phone today they don't allow drop shipping. They have told me that I have to confirm my ID etc to have my limit of 10 items lifted and I also have to send them an invoice for the goods I am going to sell. They said they don't allow drop shipping anymore as it is too risky to customer. Reply
Dear SaleHoo team, Please confirm sheila's claim that eBay does not allow dropshipping anymore. If that's the case, then what else can we do to make money with Salehoo directory? I am yet a member of SaleHoo. Reply
Site Admin
@remly We have heard of some eBay customer service agents stating dropshipping is not allowed (see forum post http://www.salehoo.com/forum/dropshippers/ebay-australia-said-dropshipping-is-not-allowed-9668) but then there is no official announcement/policy confirming this. Drop shipping is referred to as 'product sourcing' at eBay and they even have a how-to guide for this which you can still view through this link: http://pages.ebay.com/help/sell/product_sourcing.html Please note also that sourcing products from SaleHoo is not restricted to eBay selling. You may resell at any selling platform of your choice. Hope this helps. :) Reply
Hi, I am from India, i want to confirm whether i can use the drop shpping company of USA to sell the stuff in US. I tried to google for the same, unfortunately no clear answers. Reply
Site Admin
Hello Annie, Yes you can use a US based dropshipper and sell the products online to US based customers even if you are located in India Hope this helps! Richelle :) Reply
Hi, I am based in UK and thinking to do business at home as I need to take care of my 2 kids, so dropship and ebay are best match, but Salehoo is based in US, so drop ship to UK should be very expensive, am I right? Any advice? Reply
Site Admin
HI Momopig, SaleHoo is available worldwide and we have thousands of members based outside the US. Approximately 75% of our suppliers ship worldwide and the best deals are often found outside the US in countries such as China, Hong Kong and the UK. All in all, SaleHoo is an excellent resource for international members! Reply
Site Admin
@Ron Barnhart Thanks for clarifying this. Hopefully our subscribers and members will not get confused and use them interchangeably -



Posted by Ron Barnhart on 19:56 18 Jan 2014 I am confused as to why people are using the terms "drop-shipping" and "pre-sale items" interchangeably. They are not the same thing. The Policy page on Ebay is very clear that "pre-sale items" are products that have not yet been released --->to the public. Reply
it is march 18 2014 and im just finding this comment section. I am new 90 plus days to ebay and profits of about 900 total. not hgh ticket items as I was told to avoid them-electronics in beginning.
is saleoo still one of best drop shippers. im aggravated with the fees from paypal and ebay but until I can be independent or find another auction site other than ebay where I can realistically sell, im looking for other options,as amazon has screwed up big time on one of my sales .it took 2 months to correct 2 refunds and 3 re purchses later to get right!
im selling pet supplies fyi- now I heard whole brands is awesome too? any advice-appreciated! Reply
You CAN use drop shippers on eBay as long as YOU can guarantee the fulfillment for every single item you list. The problem is that when you use a drop shipper you cannot guarantee the availability of the item you list because you do not physically have that item in your possession at the time of listing. If your drop shipper can guarantee the item, then it is as good as you having the item on hand. But many drop shippers are not going to hold items except for a few that I know

I use a supplier called Albany Distributing. They have a “wish list” that actually allocates the inventory of the product(s) in your wish list. When you’re ready to order it then you just click the “add to cart” button from the wish list to purchase the item. This supplier will frown down if you do that for too many items at once do it within reason.

This company has fantastic wholesale prices and dropshipping fee and is very easy to deal with.

Other sources that I use as well are Petra, Megagoods, and dropshipdirect.com. All have great prices and is easy to deal with.

Doba, however, I would stay away from. I’m confident I don’t need to explain why.
Reply
Full Member
hi everybody I am a new member here, and just now I found the following statement on the website dropshipper, and I am a little confused, because it is not clear what the purpose of these statements...????

For Dropshippers

If you are dropshipping an order to your customer, please make sure the shipping address for your order is the same shipping address used for your PayPal payment. If the shipping address you used for paying by PayPal does not match the shipping address for your order then there will be delays in confirming your payment.

This is a statement that my shipping address must be the same as the address of the buyer who buys the goods to me. whereas my paypal shipping address is different to my buyer's address?? Reply
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