One of the most popular online marketplaces among sellers and drop shippers is eBay. This is a complete Guide to Dropshipping on eBay from scratch.
Dropshipping business model that doesn´t involve significant investments, promotional campaigns, or deep marketing or design knowledge. It is available to everyone.
However, selling on eBay has many peculiarities, which you need to know before starting your dropshipping store there.
The most significant advantage of eBay and why this platform is so popular among drop shippers is that an experienced seller or an aspiring dropshipper will need only a few things to start dropshipping on eBay, which we will show you in this post.
Table of Contents
Why dropship on eBay?
First, eBay is the second-largest marketplace in the world after Amazon, and it is constantly growing. As of the beginning of 2020, it had 183 million users.
Initially, it was created to connect buyers with online sellers of used or collectible items in auction-style listings.
However, it changed to fixed “buy it now” price listings during the last decade. Nowadays, almost everything can be found on this online platform.
Dropshipping is generally a business model where the sellers don’t hold the inventory.
The drop shippers have suppliers whose products they sell in different marketplaces.
Once they receive a payment for the order, they buy this item from their suppliers and ship it to the buyer’s address.
Dropshipping on eBay differs from Shopify or Amazon-based dropshipping. Unlike other eCommerce platforms available for dropshipping, eBay presents a straightforward process of launching a seller account and a seller store (it’s two different things on eBay).
Since the company spent millions of dollars on marketing and already has millions of buyers searching for the products on eBay, there will be no need to spend money on advertisement campaigns or think about how to get traffic.
This is the main difference from the traditional model of Shopify dropshipping, which includes paying for advertising and building your website on Shopify Shop Builder.
Besides, selling on eBay doesn’t obligate you to hold the inventory, unlike Amazon does.
eBay dropshipping vs. Shopify dropshipping vs. Amazon FBA
Hence, you can start dropshipping on eBay without second thoughts if you don’t have prior experience in online sales, marketing, advertising, designing shops, exporting, and importing goods.
This is especially true considering the low budget required. But you would need to understand how dropshipping on eBay works then.
Attention: eBay dropshipping is based on two concepts:
- Online arbitrage consists of finding the right items to sell on eBay with lower prices on other selling platforms, like AliExpress, CjDropshipping, Costway, etc., and sourcing them from there on eBay.
- eBay search engine optimization, aka SEO, is the methodology of ranking your products on the first page in the search results on eBay.
How To Start Dropshipping on eBay
To dropship on eBay, it will be necessary to set up:
- A particular selling account on eBay (you can’t dropship from the usual account there);
- An account on your supplier’s site (for example, on Aliexpress, CJDropshipping, Chinabrands, etc.)
- A PayPal account
- An account on eBay dropshipping software DSM Tool (to automate the stock and inventory update).
How do you create a selling account on eBay?
To dropship on eBay, you need to open an eBay selling account. This is a straightforward and fast process.
Such an account will allow you to sell on eBay and access special features for sellers, like the eBay seller hub, from which you will manage your business.
If you aren’t an eBay user, sign up for the right eBay marketplace (e.g., you can sell on eBay USA, UK, France, Spain, Germany, Australia, etc.) and provide your correct name and phone number.
If you have an account on eBay, you will need to click on the button Sell in the top right corner to create it: 
Well, once you click there, you will be asked to sign in to eBay again, and they will ask you to provide some data about your products. You can skip it since you will need to set the settings first.
So, click on the My eBay button > Account and find the clickable phrase “Change automatic payment method.”
You must set which payment method to pay seller fees and eBay Money Back Guarantee reimbursements: PayPal, Debit card, or Credit Card. Then, you must provide the data for the chosen payment method. That’s all.
If you want to sound more professional from the beginning, you can use the store’s name instead of your name or a nickname. To do so, open Account > Personal Info > User ID > Edit and set the necessary name.
Pro tip: Unlike other platforms, you can use the same eBay account to sell and buy items.
It allows you to get extra feedback. Invest 10-20$ dollars in buying the stuff at an eBay auction (the cheaper, the better).
The sellers might leave you positive feedback, and as a result, your eBay reputation will rise.
Setting business policies on eBay
Business policies are vital because they make you transparent with your potential buyers about how they can pay you, whether you will accept returns, and how long they will receive their package, aka Payment, Return, and Shipping policies.
It would help if you got to know each website you plan to use as a supplier since the information in your eBay policies, like shipping terms or return terms, can be different for them. You can apply different policies for other listings.
Click the My eBay button, then go to the Selling section > Business policies. You will need to click on the Opt-in button to start using them.
Dropshipping on eBay: Shipping Policy
Here, you show your buyers the terms and method of shipping for your items. When sourcing products from a supplier, please pay attention to his shipping terms, handling time, and fees.
For example, if you begin listing items from Chinese suppliers like AliExpress on eBay US, you can set a 5-day handling time (when the order is processed).
Choosing a shipping method that includes “from China/Hong Kong/Taiwan.”
It would be best to remember that these shipping terms need to cover your seller’s shipping time on AliExpress.
For example:
Regarding the shipping fees, AliExpress sellers (and, in general, every supplier) offer different shipping methods. Some are free, but some delivery options are paid.
Sometimes, it is better to choose the paid shipping method since it is faster. For example, ePacket is a reliable shipping solution.
If you use automated software to list the item, various software, like DSM Tool, will include shipping fees in the final price of your listing.
But if you create the listing manually on eBay, you must include the shipping fees in your shipping policy.
It’s essential to specify which countries your suppliers don’t ship to. You must exclude the exact locations or countries from eBay’s shipping policy.
Return policy
First, checking the return conditions on your supplier´s page is advisable. Then you can choose one of the following options on eBay:
- No returns
- 30-day buyer-paid returns
- 30-day free returns
- 60-day buyer-paid returns
- 60-day free returns
Pro tip: by choosing the option where you offer the returns, eBay can reward you with better visibility in eBay search results.
The return policy can be the following:
However, you must choose which return policy to use. Depending on your suppliers, you can also use multiple return policies.
Payment Policy
To protect the buyers and sellers, eBay offers only payment methods that provide robust protection, such as the following:
- PayPal
- PayPal Credit
- Credit card or debit card processed through the seller’s Internet merchant account
- Payment upon pickup
Among the payment options mentioned above, PayPal is recommended for dropshippers since it offers protection from scammers.
Overall, eBay is working on adding more payment options with its new managed payments.
PayPal account or eBay-managed payments
When a purchaser buys something from you, you have to get paid.
Most of eBay’s transactions are processed by PayPal; however, until the end of 2021, eBay should move to its payment processing system.
Consequently, until it happens, you need to have a business PayPal account. You can create it on the official PayPal website by following the given instructions:
Unfortunately, you will need to pay PayPal fees. They vary depending on your and your buyer’s location. The exact fee for different locations can be verified on the PayPal site.
For example, if a US-based seller sells an item to a US-based buyer, he will pay PayPal 2.9% + 30 cents per sale as fees.
If you are a European seller and have international, say, Chinese supplier AliExpress for your store on eBay US, you will pay 4.4% + 30 cents.
The same fees will apply to US-based eBay sellers who sell to international (non-US) buyers.
However, when eBay-managed payments become obligatory for all sellers, or if you enroll, these fees will differ. For example, you will no longer pay 30 cents fees per transaction to PayPal. eBay fees will also be different.
eBay fees
Dropshipping on eBay means dealing with different costs. The main eBay fees are the following:
| Insertion (listing) fees | These are optional fees for eBay pro features, like international site visibility. |
| Final value fees (selling fees) | These fees are a percentage of an item’s total sales price. You pay them only when you make a sale. It’s 10% for most sellers or even lower. |
| Listing upgrades | Certain categories, i.g. motor vehicles, real estate, and industrial items, have extra fees. |
| Fees in select categories | Specific categories, i.g. motor vehicles, real estate, and industrial items, have extra fees. |
It’s not that bad since, using dropshipping automated software like DSM Tool, the fees are calculated and included in the final price of your listings.
There is a particular term for that: “Break Even.” It’s a percentage used in calculating the final price, including all extra fees (PayPal fees, eBay fees, taxes, etc.).
On the other hand, eBay takes over the responsibility of driving traffic to its platform, which we sellers use without investing additional money.
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Setting an account on your supplier’s site
You need to have an account on your supplier’s site from where you will order products for your buyers. There are many sites where you can drop ship.
For example, in other tutorials or videos about dropshipping on eBay, sellers source items from websites like Walmart, Home Depot, or Amazon.
These sources are also popular, but these websites are not as beginner-friendly and less favorable in eBay’s eyes. That’s why we recommend starting with dropshipping from AliExpress.
You can dropship from AliExpress using any buyer account. Go to AliExpress, sign up, and you’re done.
However, it is recommended that you also set up an AliPay account to automate your dropshipping business.
You can set up AliPay by entering the My Aliexpress section and clicking on My Alipay -> Account.
When done, log in to AliPay and add your credit card details under Settings -> Manage Your Cards. This will allow you to pay for a dropshipping order with one click.
Getting eBay Dropshipping Software DSM Tool
DSM Tool is eBay dropshipping management software that automates many tasks that dropshippers do manually when dealing with only a few listings but can’t do by themselves when developing their stores.
For example, this software controls the stock and price changes on your suppliers and applies these changes to your listings on eBay.
If no more items are available in your supplier’s store, DSM Tool will detect it and set 0 for your listing quantity as well. It supports not only Aliexpress but also 50+ different popular suppliers.
Besides, it has many other valuable features for eBay drop shippers, from analyzing your store statistics and helping you manage your business to automating the feedback messages you send to your customers.
You can start with a free account on DSM Tool’s official site. Click here on the sign-in button and provide your name and email to start:
Well, now, when all accounts are set, you are ready to create your first listing.
Listing your first item
Firstly, you need the item you want to source on eBay. eBay dropshippers use two main methods for product sourcing: snipping products from other dropshipping sellers and finding trending products by themselves or with the help of special tools.
The trend hunting method, the 2nd one, is shown in detail here:
Secondly, when you have the item you want to list, and you’ve checked the reliability of your seller (feedback, the seller starts, etc.), you are ready to start listing.
To manually create the first listing on eBay, log in to your account on eBay and click on the “Sell” button at the top of any eBay page.
Since you are a new seller on eBay, they can ask you to provide more details for verification, such as your phone number and address.
Sometimes, they ask for an ID document. It’s better to do it, as many new sellers get their accounts closed due to unverified data.
Then eBay will ask you to tell them what you are selling. Copy the title of your item from the supplier’s page, paste it there and click “Get started”.
On the next page, you’ll see all the listing options. They are self-explanatory. Copy and paste the information from your seller’s page and upload the photos.
This video walks you through them:
However, there are ways to save time by manually creating listings on eBay. For example, you can use eBay’s automated dropshipping software to do all these steps in a minute.
You will need to choose the item, paste this link to the DSM Tool, and click the “List” button:
Then, the DSM Tool will pull all available information from the source page to your future eBay listing:
Tough, you will be available to adjust some of the listing options. Here are the reasons why you should do that.
Tips for dropshipping on eBay
As mentioned at the beginning of this article, the important part of eBay dropshipping is eBay SEO optimization. It includes:
- Price Optimization
- Title Optimization
- Images Optimization
- Item specifics optimization
- Product description optimization
You need to pay attention to each of these components to raise the visibility of your listing on eBay search results and get your first sales. Here are some tips on how to do it:
- Hence, edit the title of your listing. Include more trending keywords (the more, the better). You can use additional tools to find which keywords are trending (though DSM Tool has a title optimization based on eBay search results that helps).
- Include as many specifications as possible. Don´t forget about size and dimensions.
- Ensure you choose the right shipping and return policy for Chinese or local suppliers. This will affect the shipping time shown in your listing.
- Don’t use photos with the logo of other shops, watermarks, or low resolution.
- Use a comprehensive item description, not too long.
- Apply the design template for your listings, making them more eye-catching.
Processing an order on eBay
Sooner or later, you will receive an order on eBay. Congratulations! As soon as you confirm that you received payment from your buyer, don’t hesitate to start processing your order.
Login to the account on your supplier’s website (from where you took this item); according to the examples from this article, it is AliExpress, but it can be any other supplier. Add this item to your cart there, pay for it, and when you get a form with the address, provide the exact address of your buyer.
If there is missing information in the shipping address that your buyer left on eBay, it is better to contact him to brush the doubts aside.
That’s ready! Now mark the item as shipped on your Orders on eBay. Besides, sending your buyer the message that you shipped the item can be a good idea. Providing good customer support is vital on eBay or other selling platforms.
Once you receive the tracking information for this order on AliExpress, add the tracking number to this eBay order and send your buyer a message with the tracking.
Dropshipping software can help you with this. If you have an account in such a tool, you will receive a notification when the sale appears on your eBay account.
They also help fulfill the order by automating the copy-paste of the buyer’s information and sending the tracking number.
Moreover, you can set automatic messages to be sent to your buyer once you receive the order and once your buyer confirms that the order was delivered.
Challenges faced by eBay new sellers
Everything sounded not so complicated until this moment. But you need to know that you will need to prove eBay your reliability with starting the business there, and it will be connected with a few limitations:
- When processing your first orders, you will notice that PayPal holds money for them. Unfortunately, new sellers get in the so-called “PayPal Jail” for three months. The holds will last for one of three options:
- Three days from the confirmation of the item delivery,
- Seven days from the estimated delivery time;
- Twenty-one days after the buyer paid for an order.
As a consequence, it’s better to have another payment method that you can use to pay for the products on your supplier’s site at the beginning.
Besides, getting a better reputation on eBay can relieve you of those payment holds.
- Listing limits will be the next challenge for new eBay sellers. After creating your selling account on eBay, it will be limited to 10 items with no more extensive than 500$ value. It means you can list only ten items (including the variations), and they can’t overcome a 500$ value. It’s important to understand that it was created to check your credibility, and buying an eBay plan will not change it. However, you can request to increase your eBay selling limits by getting positive buyer feedback and sales and showing an active selling performance.
- eBay VeRo violation is probably a new term for you. The Verified Rights Owner or VeRO is an eBay program that allows owners of intellectual property (IP) rights to find and report eBay listings that violate their rights. Listing the items from the brands without special permission will violate the eBay VeRo, and, as a consequence, such an eBay selling account can be suspended. The list of such brands is updating constantly on eBay, you can consult them before listing your product. However, the easiest way to avoid VeRo violations is to use dropshipping software that protects your account from such brands. The monitor mentioned above in the DSM Tool also has this feature.
Conclusion
As you can see, dropshipping on eBay is a quick way to get involved in eCommerce.
Starting to dropship on eBay doesn’t require big investments, marketing campaigns, profound design and analytics knowledge, or much time.
You can start even today! The most critical knowledge for building a successful eBay store, online arbitrage, and eBay SEO is mainly based on experience. You can still learn them after opening an eBay selling account.
This post was written by the DSM Tool eBay Expert Team. DSM Tool is innovative, all-in-one dropshipping software that automates daily dropshipping routines for eBay and Shopify sellers. We love to share our experience and guide drop shippers to success.
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