Wholesale & eBay Forum Drop Shippers & Drop Shipping How do I list items for dropshipping?

How do I list items for dropshipping?


valone.jay
Full Member
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  • Joined: 19 Jun 17
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20 Jun 17 06:23:22 pm
Hey all,
I have created an account, and now am looking for suppliers.
When I find a supplier I want, how do I list that item on Amazon?
Do I have to purchase the item first, and then find a way to store it before the customer buys it?
I was trying to do dropshipping, which from my understanding, I wouldn't have to pay anything until a customer purchases the item from my listing online. So I thought the steps were:
1. Find an item
2. List item on my store
3. Receive purchase
4. Contact seller of said item, purchase item from them with funds the customer gave me, then copy and paste customer info onto supplier's website, hit send/ship.
5. What's left is my profit! Minus the fees and whatnot Amazon would charge.
I am NOT doing FBA, I am dropshipping, but I'm not understanding the gap here, and none of the videos on sellercentral or salehoo guides or even jvzoo or reddit or anything is giving me that answer. Can anybody help me out with this?
Thanks!
- Jay


Crazy Warehouse Deals!

fudjj
Site Admin
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20 Jun 17 07:43:11 pm
Hi Jay and welcome to SaleHoo,

Dropshipping means that you don't purchase the item up front, unlike wholesale. What you do is set up an account with the supplier/d you want to do business with, then list what item's you want to try and sell. Once/if you make a sale, then your customer pays you and you then pay the supplier, you pass on your customer's shipping details and the supplier ships direct to them.

No that's the basics of our the model works, but there is a stack of work that you have to do in between. For example, it's not just a matter of listing whatever you want for how much you ant to sell it for. You're moving into an ultra competitive business within one of the most ultra competitive marketplaces in the world.

So you first have to find products at prices that will allow you to make a profit because you're just wasting your time blindly listing items not knowing what your competition is. So this all comes down to researching the market and the more thorough you are, the better your chances are at competing.

You've also got to eb aware of issues like PayPal holds on new accounts. If you are accepting Paypal payments through a new account, there is a very high degree of chance that your account with go through a hold period. This means whatever funds your customer outs in there will be locked, so you will need cash-flow to pay for the item/s up front until your account is released and the funds can flow once more.

So there are the basics of how the dropship model works, which you seem to be asking about, but I'm not sure you are aware enough of what is actually involved in launching yourself into a market like this. I would suggest you hit the training tab on the screen to get a far more in-depth understanding of how the dropship model works and what is involved in making it work for you.

The forum is also full of information on dropshipping which I think would be valuable reading for you, so I would suggest spending some yime running through posts focused on the dropshipping topic to gain some insight into how, what and why before you consider moving into this space.

Cheers

.


Mark (fudjj)

Community Manager
SaleHoo.com

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valone.jay
Full Member
  • Posts: 2
  • Joined: 19 Jun 17
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20 Jun 17 08:32:16 pm
Hey Mark,
thanks for the speedy reply!!
your post was very helpful. I have watched all the training videos on the sellercentral page of amazon, I have read a LOT of the forums and guides that salehoo offers, and have also watched all of the training videos available on JVzoo, along with many individuals on youtube, reddit, and others. I have a good understanding of what needs to be done, I just simplified it for my prior post as not to be too complicated and drug out.

So, what you're saying is, before I start wasting my time with listings, really study the market, and the niche that I will want to be getting into, and then do the math on the products I'd be selling to determine potential profits and if it is worth selling or not.
Also, another question, is how do I list products on my amazon store?
Obviously find the ASIN/BIN/Item # etc, but for example, I found a toy drone RC spy cam thing, for like 80 dollars, went to put it on my amazon store for 40, since it was listed on the supplier's website for 29.99USD. That's a boatload of profit, as long as my item actually sells.
Only problem is, there was no bin number, asin number, or anything. I had to physically purchase the item, to sell it, even though I found it on salehoo.com as a supplier that supposedly allows dropshipping. So my question I guess is, if I wanted to sell that item, I would have to contact the supplier and inquire about me dropshipping that item and listing it on my store? Is that pretty much it?
Do I have to do that with every product? Because a lot of the videos I've watched on sellercentral, youtube, and others, they all say I just find an item, get the item number, and list it on my store, simple as that. Unfortunately I have found that NOTHING is as simple as it ever seems. But I don't mind, this is a very lucrative market to get into, as long as you know what you're doing, and are willing to do real work to contact vendors and do product research. I am willing to do all of that.
Can you (if you don't mind) give me a step by step process of how I would correctly go about dropshipping an item?
Is it:
Step 1. Locate the item.
Step 2. Contact the vendor/supplier of said item. Negotiate dropshipping fees and terms. Gain approval.
Step 3. List item on my amazon store (how would I do that? will the vendor give me the item/asin/bin number.?)
Step 4. Receive payment from customer if/when a purchase happens.
Step 5. Take that payment, purchase said item, take the buyer's information and send it to the dropshipper.
Step 6. Profit?

Is there something I'm missing? Or is that all there is to it?
Thanks for your time and help Mark! I appreciate it!

- Jay


Crazy Warehouse Deals!

fudjj
Site Admin
  • Posts: 6356
  • Joined: 27 Jul 07
  • Karma:
20 Jun 17 09:27:09 pm
Hi Jay,

Yep, very first step in to really research your market and identify your primary competition within that market. That's your benchmark that you have to hit to be competitive. So look at their services, shipping times, customer service, even the level of their branding and so on, they things matter to customers, it's not just about the price always.

That said, most e-commerce purchases does end up with price playing a big role in the purchasing decision, especially on a site like Amazon that attracts bargain hunters. So you always have to make sure your on point with your price or you'll struggle to compete at all.

The thing with dropshipping is, it has lots of benefits, but competitive price usually isn't one of them. What many find is that they are out gunned on price and assume the supplier is simply too expensive, but what they don't take into consideration is what supply model the competition is using.

If you're going to go up against a seller buying in large wholesale volume then they'll always be able to out gun you on price, dropshipping margins can never compete with wholesale margins. Then you have factors like wholesale suppliers using Amazon and other platform top sell direct at their wholesale price, that makes it even difficult for wholesale buyers to compete.

Throw in on top market techniques like loss leaders, where sellers are listing at below cost to attract traffic, then you get a bit of a picture of how complicated a market like this can be to deal in. Everyone is playing to a different set of rules to each other, that's a really important point to remember.

In regards to contacting the supplier, never take an advertised price on a website for granted. Most dropshippers will be selling retail also, so the price on the website will usually reflect the their retail price. You need to contact them in regards to the dropshipping price to get an accurate price.

No, you're absolutely right, nothing is ever as easy as some make it seem. That said, Amazon has it's own funny little listing quirks that others like eBay don't have. So with Amazon, it usually comes down to what you are listing as to what sort of drama is involved, where as an eBay or similar are far more straight forward.

I'm not an Amazon expert, so I'm not the best person to really give you any good pointers in listing there unfortunately, but many of our members do list there, so hopefully some of them can throw some advice your way on that topic.

As far as the process. Let's assume that you've done your research and identified a product and found a supplier to purchase from that will give you a margin at a competitive price.

1. Contact the supplier to open an account
2. One account access is granted, list the product (making sure your maths is correct on costs)
3. Customer processes a sale on the item and pays you.
4. You then in-act the transaction with your supplier, making your payment
5. Supplier ships to your customer

Two important points in the breakdown are number one, make sure you have enough available funds if you are using a new PayPal account, you have to assume it will get locked and your customer's funds will be trapped until the hold is lifted.

Second, make sure your maths are accurate, including things like listing fees, seller fees, transaction fees and any other fee that you may have within your chain. That's the only way you're going to get an accurate view of true profit margin. An under calculation on costs can end up costing you money.

Cheers.


Mark (fudjj)

Community Manager
SaleHoo.com

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