Many people make the mistake of confusing ecommerce on eBay with ecommerce on a commercial retail site, such as Amazon.com or Bestbuy.com or any number of other retailers selling their own physical products. However, the eBay environment and online retail environment are very different. Perhaps in the early days of eBay this distinction did not matter, but eBay is a highly sophisticated selling venue and understanding your selling environment makes a big difference.
What does this mean exactly? Well, the two environments are very different. To be precise, eBay is a wholesale selling market. Just about everything for sale is already at or below wholesale prices. You typical ecommerce site, such bestbuy.com or your localcoffeevendor.com are retail markets. This has everything to do with your choice of product sourcing, target customers, and profit margins. If this is the first time you have thought of this, don’t worry, you are not alone. For someone running a business, though, understanding your selling environment is crucial.
Because eBay is essentially a wholesale selling venue, the prices for most goods are already at or below wholesale cost. This means that if you are buying items singly or in small quantities from a wholesale distributor that you probably won’t be able to make a profit. This is particularly true for most popular, mass market consumer goods such as electronics. Products such as laptops, iPhones, portable DVD players, TVs, are exceptionally hard to profit with on eBay even in the best of times and with the lowest prices due to competition among sellers. If you purchase these items at a standard wholesale price and try to sell them on eBay, I can almost guarantee you a loss.
However, popular consumer items that may be too expensive when purchased through wholesale distributors may work very well in a retail environment, such as on your independently hosted ecommerce site. When you purchase a laptop or an iPhone at wholesale price for resale, you are retailing that item. If you try to retail an item on eBay, where most popular consumer goods are selling at or below wholesale prices, it will be very difficult to make a profit.
What I am explaining may fly in the face of all the promotion you see on the Internet, but the fact is, if you sign up for doba.com or shopster.com and expect to make a killing on eBay selling consumer electronics or brand name perfumes, you are in for a shock. Drop shipping on eBay through sites such as the two examples just mentioned is especially hard because drop ship prices are typically higher than mere wholesale because of the added expense.
Some examples of well-known sites that target their promotion to eBay sellers are dropshipdesign.com, shopster.com, doba.com, and megagoods.com. These are all legitimate sites and sources of products. However, none of them are true wholesalers, and so the question you have to ask is whether or not their products and drop shipping services will allow you profit on eBay. There is no question that they offer you steeply discounted prices, but remember that everyone on eBay is selling at or below the wholesale price, and then you have to add shipping and handling to the final selling price. I don’t want to say this can never work because it does, but it won’t work all products equally, so you do need to do some research to predict which products you are likely to have the best success with. My basic recommendation is to same drop shipping for your ecommerce site unless you are very sure your product is a winner with little competition.
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categories: dropship ebay product sourcing,dropshipping wholesale,home business
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