Doba and Dropship Direct - Your feedback needed

Full Member
roger-s
Posts: 6
Joined: 01 Jan 06
Karma: 
22 Apr 12 05:05:31 am
Would anyone like to make a comment on their experiences with either of these?

Full Member
fm1234
Posts: 838
Joined: 14 Dec 05
Karma: 
22 Apr 12 03:11:26 pm
An annual membership to Doba starts at $600. They claim 33%-75% profit margins on their inventory, which while I personally consider that an absolutely nonsensical claim, for purposes of illustration I'll say "assume a 33% profit margin."

At 33% you need to be prepared to sell $6,000 a year in volume to clear a net $100 and change after eBay fees, payment processing, the Doba membership fee, and taxes.

$6,000 sales
-$ 720 eBay fees, payment processing and related expenses
----------
$5,280
-$ 600 Doba membership
---------
$4,680
-$4,500 cost of product
---------
$ 180 before taxes

Obviously, you might be able to find some stuff with higher margins, get your operating costs down, etc. However, no matter how you slice it, the profit margins at best aren't going to go too much over normal dropshipping margins, which tend to be less than 33% rather than more. And you could also spend more -- significantly more -- on your Doba membership, depending on options and how you pay for it, and that large of a number all but dictates that you sell well into four figures or even low five figures a year worth of Doba merchandise before you get to make any money that you keep.

Not a dig at Doba in particular; just an observation that the math in this business is brutal enough without having to move the goalposts even farther back to cover high-dollar memberships of any type.

Doba was featured Link hidden: Login to view a while back; some other info there.


Frank


"Failure is not when you fall down. Failure is when you don't get back up."

--J.J. Luna
Site Admin
richelle_salehoo
Posts: 5224
Joined: 20 Oct 08
Karma: 
23 Apr 12 01:41:33 am
Hi Roger,

Frank has given you a pretty answer to your request for feedback on Doba :) And personally, I don't think have anything that'll beat Frank's reply!

Just a small fact to add -

Doba is a good drop shipping service and easy to integrate with eBay, but it is expensive. Not only does it cost from US$49.95/month – that’s $599 per year, drop shipping also requires you to pay a small fee on top of the wholesale cost of the product to cover the drop shipper's time spent packaging and posting the item. This additional cost can make significant inroads into your profit margins and it is not always the best way to make money in the long term.

That's not to say that drop shipping is a bad idea altogether. It is a simple way to start a business, and in the long term, having some of your inventory drop shipped allows you to offer a broader range of items to your customers without the risk of holding stock.

However, the online retail market is very competitive and business owners usually need to buy a significant proportion of their inventory in bulk from liquidators and wholesalers to ensure that they get maximum profit margins on each item.

As for Dropship Direct, you might find the 11 reviews on their profile page helpful - Link hidden: Login to view

All the best!


Richelle

Customer Support Manager
SaleHoo Group Limited
Sell more with your own professionally designed and search optimized e-commerce website. Check out Link hidden: Login to view now!

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