Interested in opening a dropshipping business but want to keep startup costs low? eBay dropshipping may be the ideal choice.
Dropshipping on eBay removes the need to create a custom storefront, as you can use your eBay store to start selling products online. You also get access to a ready-made audience, allowing you to save money you’d otherwise be spending on marketing.
Fascinated? This post covers everything you need to know about eBay dropshipping, from finding the right suppliers to maintaining healthy profit margins.
What is eBay dropshipping?
eBay dropshipping is a profitable, low-cost business model, where a merchant buys products from wholesalers, marks up the price, and resells them through the platform.
It’s preferred by many entrepreneurs because there’s no need to physically touch any item or rent a warehouse to store inventory. Any orders you get go straight to your dropshipping vendor, and it’s their job to sort, pack, and ship the product to your customer.
Benefits of eBay dropshipping
There are numerous benefits to dropshipping via eBay:
- Low risk: eBay dropshippers only purchase goods as customers purchase them. There are no minimum order quantities. So if a customer only buys one necklace from your eBay store, you only need to pay for that one specific necklace. It’s a great business model for new entrepreneurs looking to experiment or experienced entrepreneurs looking to try a new niche.
- Highly automated: Using dropshipping suppliers like DSers, you’ll be able to automate most of your dropshipping efforts. It only takes a few minutes to list the product you want to sell on your eBay store. Once a sale rolls in, it only takes one click to process the order. This gives you more time to focus on what matters: marketing and customer service.
- Lower costs: Since you’re selling a manufacturer’s product instead of designing your own, you’ll pay wholesale pricing. Depending on where you’re dropshipping from, you might even benefit from having low shipping rates (sometimes even free) that keep costs low for yourself and your customers.
- Saves time: You only need to focus on a couple of administrative tasks, marketing, and customer service. The manufacturer tends to carry the weight of the most time-consuming (packaging and shipping) and expensive (carrying inventory) tasks.
- Millions of products to sell: You can choose from millions of products from a wide-range of dropshipping niches. Simply look through product marketplaces like AliExpress and add any product to your store in just one click. You can sell proven products rather than trying to create your own.
eBay dropshipping policies
Standard dropshipping policy
Is dropshipping allowed on eBay? Yes, eBay does permit dropshipping. However, eBay prefers that dropshippers source their products from wholesale suppliers rather than from retail outlets. Fulfilling orders from another retailer or marketplace that sends products directly to customers is prohibited.
If you resell products from another retail website or marketplace (like Amazon or AliExpress), your account may be flagged or face temporary or permanent suspension.
So the only way to stay compliant with eBay’s dropshipping policy is to source products from a wholesale supplier or use private labeling (branding products with your own label).
“Item not received” policy
Beside its standard dropshipping policy, eBay also has a new rule for “Item not received.” Basically, this means that sellers with high rates of items not being received by buyers can face severe account restrictions.
To avoid suspension, follow these strategies:
- Ensure timely shipment of products to maintain a good seller rating and prevent delays.
- Update your shipping policies to ensure clear communication with customers about shipping times and expectations.
- Partner with suppliers who offer fast shipping to guarantee that products reach customers promptly.
- Use order automation tools to streamline the fulfillment process and keep tracking information up to date.
- Regularly monitor your shipping performance to address any issues before they affect your account standing.
eBay dropshipping fees
Before diving into eBay dropshipping, it’s good to familiarize yourself with the different eBay fees involved in setting up your business. Here’s a breakdown of the costs you might incur:
Store subscription fees
eBay provides various subscription plans tailored to different needs:
- Starter Store: $4.95/month annually for 250 listings.
- Basic Store: $21.95/month annually for 1,000 listings.
- Premium Store: $59.95/month annually for 10,000 listings.
- Anchor Store: $299.95/month annually for 25,000 listings.
- Enterprise Store: $2999.95/month annually for 100,000 listings.
Choosing the right plan depends on your listing volume and budget.
Insertion fees
Insertion fees apply once you exceed the number of free listings included in your subscription plan. Higher subscription levels reduce these fees:
- Starter Store: 250 fixed price listings + 30¢ per additional listing.
- Basic Store: 1,000 fixed price listings + 25¢ per additional listing.
- Premium Store: 10,000 fixed price listings + 10¢ per additional listing.
- Anchor Store: 25,000 fixed price listings + 5¢ per additional listing.
- Enterprise Store: 100,000 fixed price listings + 5¢ per additional listing.
Final value fees
Final value fees are a percentage of the total sale amount, including item price and shipping costs. These fees vary based on your store subscription and the product category. For instance:
- Starter Store: 8% for items over $150, 12.9% for items under $150.
- Basic Store and above: 7% for items over $150, 12% for items under $150. These fees are automatically deducted at the end of each sale through eBay Managed Payments.
Promotional fees
Promotional fees are optional but can help increase your product’s visibility. eBay offers two main types:
- Promoted Listings Standard: You pay a set percentage only after a sale from the promotion.
- Promoted Listings Advanced: You pay a daily budget upfront to run your ads, similar to pay-per-click (PPC) advertising. Using promotional listings can help your products reach a broader audience, increasing the likelihood of sales.
Free listings
eBay offers 250 free listings each month, making it an economical choice for beginners. If you require more than the free listings, you can pay per additional listing or subscribe to one of eBay’s store plans. These initial free listings help keep your starting costs low.
Understanding and managing these fees can help you budget effectively and maximize profitability in your eBay dropshipping business.
How to dropship on eBay
Ready to become an eBay dropshipper? Here’s a step-by-step guide to launching your own successful eBay dropshipping store.
1. Create an eBay seller account
A seller account is necessary to sell products via an eBay store. To create one:
- Go to the registration page and provide basic information about your online business.
- Subscribe to the eBay store option that best suits your needs.
- Link your checking account to receive payments.
Once you’ve completed these steps, connect the new store to Shopify using the eBay Integration & Sync app. Doing this will enable you to see inventory levels, communicate with buyers, and manage returns—all through one dashboard.
2. Find profitable items
Next, investigate which products sell best on eBay. Check eBay’s bestsellers page for insights and check whether you can source similar products at lower-than-MRP through dropshipping sites like Doba or AliExpress.
The popular item categories are:
- Clothing, shoes, and accessories
- Consumer electronics
- Home and garden
- Pet supplies
- Toys and hobbies
Products that are lightweight are generally the easiest to dropship, so consider finding such items in the listed categories. You’ll also want to check the return rate of each item—products with a low return rate are less likely to cause problems with your customers.
3. Choose your dropshipping suppliers
Once you’ve found a profitable item to sell on eBay, look for dropshipping suppliers that can offer you a good deal on bulk purchases. If you own a Shopify store, you can use apps like DSers to connect with different wholesalers.
Vet suppliers by checking their seller rating, customer reviews, shipping times, and fees. Pay special attention to the delivery time, since eBay requires brands to deliver items within 30 days of an order being placed.
4. Create your eBay listing
Create a listing for each of the products you’re dropshipping on eBay. Include keywords that your target customers may use when searching for those items. And pay special attention to the following things—they all influence how likely the eBay algorithm is to show your products to potential customers:
- Product title and description
- Product images
- Customer reviews
- Return policy (check whether your dropshipping supplier handles product returns)
5. Price your product
eBay dropshipping becomes lucrative when you leave enough room between an item’s purchase and resale price. Determine the price of your dropshipping products by factoring in:
- Product costs
- Business expenses (listing costs, shipping fees, etc.)
- How much profit you want to make
You’ll also want to monitor and collect data on what comparable products are selling for through the marketplace. Tweak your product pricing accordingly until you find a middle ground between competitive prices and shoppers’ willingness to buy.
6. Market your listing
Your listings won’t sell themselves—you need to get them in front of potential customers to drive sales. Marketing is crucial for this purpose.
You can use social media platforms to promote your eBay store. Sharing your listings on Facebook, Instagram, or TikTok can attract a wider audience and increase visibility for free.
Another way is to leverage email marketing. Sending newsletters or promotional emails to your subscribers can keep them informed about new products, discounts, and special offers, encouraging repeat business.
Then there are paid options like Promoted Listings Standard and Promoted Listings Advanced. Promoted Listings Standard places ads across eBay, boosting visibility, but it requires active engagement on your account. Promoted Listings Advanced allows you to bid for top search result placements (similar to PPC marketing), giving your listings premium exposure.
7. Provide excellent customer service
As an eBay seller, you might not have a dedicated customer support team. But don’t worry, you can still provide excellent support yourself. Here are some tips to ensure a great customer experience:
- Respond quickly to customer inquiries: A prompt reply shows customers you value their time and are eager to help. Aim to respond within 24 hours.
- Be clear and concise in your communication: Provide clear answers and solutions to customer questions to avoid any misunderstandings.
- Include answers to common questions: It helps customers find information they need without having to ask.
- Be proactive in resolving issues: If a problem arises, address it immediately and offer a solution to keep your customer satisfied.
8. Strive to become a Top Rated Seller
A high eBay seller level, or Top Rated Seller status, signifies that you are a reliable and trustworthy seller. This status boosts your visibility in search results, attracts more buyers, and can even give you access to discounted shipping rates. It’s a badge of honor that shows customers you’re committed to excellent service.
Here are some tips for achieving this status:
- Keep transaction defects low: Aim for a transaction defect rate between 0% and 1%. This means ensuring your items match descriptions and avoiding cancellations. Reliability builds trust.
- Ship on time: Keep your late shipment rate below 5%. Partner with dependable suppliers who offer fast shipping. Timely deliveries make for happy customers.
- Resolve issues quickly: Handle customer complaints and disputes efficiently. Strive to keep unresolved cases below 2%. Clear communication and fair solutions are key.
- Upload Accurate Tracking Info: Ensure over 70% of your orders have timely and accurate tracking details. This transparency reassures buyers and enhances their shopping experience.
Dropshipping from Amazon to eBay
Previously, Amazon sellers have used Amazon-to-eBay dropshipping software like Easync and PriceYak to sell their Amazon products on eBay. This way, eBay sellers could resell Amazon products at a higher price.
However, with new policies in place, some store owners have suffered the consequences.
In a 25-page thread on eBay, customers were frustrated having ordered a product on the platform, only to receive an Amazon package in the mail with a gift receipt inside. Knowing they were paying a premium for purchasing on eBay naturally led to angry customers hurting the eBay brand. So policies were changed to stop sellers from dropshipping from Amazon to eBay.
Tips for building a successful eBay dropshipping business
Although eBay dropshipping isn’t overly complicated, there are some things you can do to set your new business up for success.
- Create a multi-buy offer. Multi-buy offers basically are eBay’s version of bundled offers, where you sell one product for $5, two for $8, and so on. They’re a great way to increase your profit margins, since you won’t need to pay import or shipping fees several times.
- Unify your inventory. Dropshipping tools like DSers merge inventory data from all sales channels (including your eBay storefront and online store), so you can view customer and sales information in one place.
- Automate your operations. Utilize tools like Mailchimp for email marketing, Inventory Source for inventory management, and ShipStation for order processing to automate your workflows. These tools will save you time that you can spend on expanding your product range and optimizing your listings.
Starting Your eBay dropshipping journey
With millions of users turning to eBay to find and purchase products, opening a dropshipping store on the platform is an obvious choice.
Apply the tips from our guide to source profitable items, create a seller account, and start making a profit. With dedication and the right approach, you can build a successful dropshipping business and generate a substantial income stream through eBay.
eBay dropshipping FAQ
Is eBay dropshipping profitable?
Dropshipping on eBay is profitable and low-risk. The key to success with an eBay dropshipping business is sourcing products at a low cost and selling them on the marketplace for a higher markup.
How much does it cost to dropship on eBay?
eBay dropshipping fees include listing fees (35¢ for each listing beyond the 250 free insertions per month), final value fees (12.9% of the sale price or lower, depending on the product category), and store fees (starting at $4.95 per month).
Do I need a seller license to dropship on eBay?
You don’t need a seller license to dropship on eBay. However, it’s crucial to follow the site’s rules to avoid penalties. Keep in mind that business license requirements can differ based on your location. Check your local business laws to be certain.
What are the best eBay dropshipping suppliers?
Reliable suppliers are critical to dropshipping business success. You can find suppliers on platforms like Alibaba, AliExpress, and Doba. Be sure to check the seller rating, customer reviews, and estimated delivery time of each individual supplier.
What should eBay dropshippers keep in mind to avoid account suspension?
- Ship products on time.
- Maintain low transaction defect rates.
- Avoid listing counterfeit items.
- Source products from reputable suppliers.
- Follow eBay’s dropshipping guidelines.