The Wholesale Forums

[shaneo632]

I've been lurking on here and E-Bay for a while just working out the business practises, and I finally decided to do a small-scale test to see whether my business model would work.

The generally idea is to use a rather well known deal website (which catalogues all of the new deals of UK stores), and then use those sites to dropship on E-Bay.

I tested this by listing 5 items (each with a x5 quantity) each for 3 days with Buy It Now and Best Offer feature available. So far I've made about £14 in profits for probably an hour's work, spending £30 on items to get that £14 profit. It's a rather good system whereby I withdraw the PayPal payment as soon as I buy the item with my card, so generally the two payments coincide and I'm never out of pocket for more than 1-2 days.

The only problem, of course, is that I'm a student and therefore not that well funded, so while I'd like to take this on a bigger scale, such as listing maybe 50 items at once and seeing how much profit I can rake in, I obviously will need funds to support this. I could probably ask my brother but I just wondered if there was any other advice?

I really think this can work as it requires minimal operation and near enough works as follows:
- list 50 items
- sit back and wait for items to sell
- dropship item to customer
- pay off E-Bay fee with PayPal money
- withdraw the rest of the PayPal payment to my bank account as profit once the retailer payment comes out.

My real concern I guess is that PayPal are either going to freeze my account or something with all of the money that would be passing through it. I have 97.5% positive EBay feedback after almost 100 transactions, and I have over 20 seller ratings, but aren't there limits imposed on how many thousands you can earn through PayPal unless you upgrade? Is that expensive?

Any advice is appreciated.

[shaneo632]

Allow me to offer one example, the FRIENDS SERIES 1-10 DVD set recently dropped to £39.67 on Amazon, while EBayers were still paying £55-60 for it. If I sold each set for £53.99, that'd be almost £6.50 profit per set (that's including PayPal + EBay fees), which would be ridiculous for the small amount of time it would take to sell them.

I'd spend £80 and get about £13 in return. Perhaps not a superb ratio or anything but it'd be an easy sale. The main crux here seems to be that to make about £100 a week I'd probably need about £500 in investment capital.

Nevertheless, it has shown small results in my demonstration and I'm confident it can work as the model relies on being quick with catching deals, which I am very good at.

[Declang]

Do you not get negative feedback from buyers when their product turns up in amazon packaging?

[shaneo632]

Not once. I gave it a test with 30-40 items a while back and they all gave me positive feedback and didn't mention the packaging at all.

[shaneo632]

Also, one other thing; I'm considering getting a credit card for the sake of making business easier. At the moment I use my debit card, so the money HAS to be in my account, which of course limits the business I can do. A credit card would give me the capital I need as I can just pay the bill once the PayPal payment has come in a few days later?

[Declang]

Yea, credit would be a suitable option as you only buy the product once its sold and can pay off your bill straight away and not have any interest charges.

[crispydog]

Sounds good but in the long run I think unworkable & an easy way to get stung,many of these deals last for a few hours most for a few days.You will certainly have occasions when the supplier will email you a few days after the order saying its out of stock,it happens all the time.
I buy stock from these type of deals all the time & make good profits but the operative word is BUY .
One thing for sure is although you have not had any yet you will receive negative feedback for sending items from other suppliers when the customer expects it from you.

[shaneo632]

I totally agree about the possibility of getting stung, but then I never deal in anything too niche, so I can normally source it for a few quid more from elsewhere and probably not make too much of a loss (if at all), and if that happens in even as many as 10-20% of cases, it won't be a problem.

Today I've sold 5 items. One of them I had to re-source but I still made a profit.

[shaneo632]

Also, as the items sell themselves and require very little maintenance, on a typical day I would be constantly price-checking my items every 30-60 minutes to minimise the risk of the price changing etc.

But yes, the stock being cancelled after I've bought it is a legitimate concern, I appreciate.