Drop shipping on eBay can work, but most of the time, it doesn't work well because eBay is one of the most competitive marketplaces in the world. It's extremely price-driven, and most people there are looking for a bargain. This makes it hard when you are drop shipping because anytime you are selling the same item that another seller has bought at bulk wholesale prices, they'll be able to undercut you. So where's the best place to drop ship on the web? I've got three options for you.
1. Drop shipping from your own store
Drop shipping from your own website is one of the best ways to drop ship products for good profits. One of the reasons it's so successful is because you have more control over your listings, and you get to cut your marketing teeth by building a loyal following through Facebook and other relationship marketing tactics such as email.
Also, when you sell on your own website, it's not as easy for shoppers to price compare like they can on eBay or other comparison shopping engines. This means your pricing won’t have as much to do with your sales revenue; rather, your website’s aesthetic and your marketing will play a bigger role in your overall conversions.
The financial gains of selling on your own website don't stop there. When you sell from your own website, you are building up a brand and a real asset. Even though websites aren't tangible things that we can touch, they can grow to be worth a lot of money. People often build up a store and sell it to another retailer, making some really good money in the process. In my opinion, this is truly one of the biggest benefits of selling on your own website, because it means instead of all your time and effort going toward pulling traffic to eBay, you're building your own site and your own business.
Think of your online store as a retirement fund: The profits from your sales are your salary, but every time you make a sale, you are passively adding value to your store. In time, your store will be worth a lot of money.
You'll often hear people talking about the fact that when you sell on your own store, you save on marketplace fees. Of course, it's true that you save on marketplace fees (which is wonderful), but there are usually other ongoing costs associated with running your website, such as buying a domain or hosting. The difference is, when you spend money on your store, you're investing. It's a like paying a mortgage rather than rent (the "rent" being marketplace fees).
The cost of setting up your own store
You might think that starting your own online store will be expensive, but it's not. Many ecommerce platforms and store builders make it so easy to get started. These store builders are created by some very talented website programmers who have done all the hard work to make it easy for you. With these options, you can literally have your store up and running within minutes.
Call me biased, but SaleHoo Stores is my favorite! You can import listings from eBay (if you have any) so that you have products instantly live on your website. You can also choose from a variety of site designs so that you can get something that you really like and, most importantly, something that sings to your audience.
Do you have the technical skills to run your own store?
If you're like most people, you might be worried that running your own store might be difficult. With most reputable store builders, you need no technical knowledge or experience in order to run your business. I know that when we developed SaleHoo Stores, we worked really hard and did a lot of testing to make sure that people of any technical ability can get started. We offer a money-back guarantee when you sign up, so you can try it out with confidence. Don't take my word for it, though. Hear what this SaleHoo Store owner had to say:
We are delighted to own a new SaleHoo store! We have only been store owners for 2 months but we know that out store will be a success. How different has been our experience with the superb customer support professionals of SaleHoo. We are happy to found SaleHoo Stores! It has been one of the best decisions we have made for our business!
- Adoracion and Jose L. Barrios
Getting traffic to your online store
You'd be a fool to think that your website will get traffic as easily as eBay or Amazon does. When you sell on your own store, you will have to work hard to bring buyers in though marketing, search engine optimization and social media. You will need to be prepared to either invest time or money into your marketing. SaleHoo Stores helps out with some cool marketing features such as coupon codes and built-in email marketing and banners. All SaleHoo Stores are also built in a search-engine friendly way, which will make it easier for buyers to find your products when they search Google, Yahoo! or Bing.
2. Drop shipping on Amazon
It's no secret that Amazon is an incredibly powerful marketplace. After all, it's one of the most-visited websites in the world and no other platform can match it on exposure. For this reason, you don't need to do a lot of marketing to make consistent sales on Amazon. SaleHoo member Ryan Norton had this to say about Amazon:
I love amazon. I think it is an easier way to make money and don't have to handle the fee's that come with eBay. eBay takes fees out later but Amazon takes them out right away so I don't have to worry about it. I have been selling on Amazon for years and that is the sole reason I joined Salehoo. What can I say I love Amazon :)
- Ryan Norton
While Ryan obviously doesn't seem to mind the fees on Amazon, many other sellers do find this a sore point. Amazon's fees seem to be higher than any other marketplace on the web. This is the only drawback with Amazon and it can be a problem if you are drop shipping products with tight margins. Be sure to check out Amazon's fee schedule to determine whether it's worth you drop shipping there. You may find that after paying your supplier, you aren't left with a lot of profit.
Amazon Fulfillment Warehouses
Amazon Fulfillment Warehouses can be an interesting drop shipping alternative. Since you aren’t shipping to customers directly, it can’t technically be called drop shipping; however, Amazon offers to serve as third-party inventory storage. You send your products to the Amazon warehouses (it doesn't have to be a lot), sell the item on Amazon and then Amazon ships it to the customer. Additionally, Amazon provides customer service throughout the shipping process. You can learn more about this here.
3. Drop shipping on Bonanza
Bonanza has one of the friendliest and most loyal communities among all online marketplaces. It also has wonderful customer service and fair fees that leave plenty of room for profits. This marketplace also allows payments via Google Checkout (as well as PayPal), which is good for anyone trying to dodge PayPal fees (Google Checkout is a little cheaper). Bonanza also boasts a growing customer base and has some cool marketing tools that you can use to increase your sales.
I've already talked about all the great things that Bonanza has to offer in this lesson, so check that out if you need a recap on what makes this award-winning marketplace so ideal. Here's what SaleHoo member Sharon said about selling on Bonanza:
I'm a 3 week old Bonanza newbie (and a 4 year eBay veteran). I currently have the duplicate items listed on both sites. (Just until my eBay listings run out). During my 3 weeks at Bonanza, I have made MORE sales than in that same time frame at the bay. The place is AWESOME! Folks couldn't be nicer. Everyone is happy and helpful. The sellers' common goal is for everyone to sell. I can list a good 5-6 items in the time it took me to list 1 at eBay. A person can't possibly believe it without trying it! I couldn't be happier being at Bonanza!
- Sharon
I've read many stories just like Sharon's: Sellers have moved from eBay to Bonanza and experienced an increase in sales. If you are worried you aren't making (or won't make) enough sales drop shipping on eBay, check it out. You can sign up for Bonanza for free.
I also encourage you to check out SaleHoo Stores and Amazon and consider them as solid options for your drop shipping ventures.
