Wholesale and Drop Shipper Secrets.
Here is the wholesale list I promised, but make sure you read the email I just sent you and this page before you contact any of these companies as well as the below important information about dealing with wholesalers.
Download your Wholesale/Dropshipper List
View your unadvertised Bonus Free Wholesale List
You will receive an email with a link to this page and it will also contain some of my own private information about Wholesalers which you should read before you deal with any wholesaler. I am providing you with a LIST of wholesale companies, I do not guarantee the quality of any of them. There are better ways to make money through ebay than buying from a wholesaler or drop shipper. I will cover those options in this course. So don't get gung-ho about posting your auctions immediately and get yourself into trouble with a bad wholesaler when you have other options. Learn from my experiences and you will have a big advantage.
The above list is commonly sold for $9.95 to $35 but when you find out what I will reveal about drop shippers and wholesalers, you will see there are better options if you want to make serious money on eBay.
The second bonus list is also sold for 99 cents to $9.95 and more but I think it is a rip off to charge for that list so I am giving it to you for free. I will explain why shortly.
What do you sell on eBay?
That is the real question isn't it. Once you have cleaned out your garage and attic where do you look? Many people make the mistake of buying at yard sales or flea markets. This is a dead end. You will NEVER make money like this. I do not care how many self proclaimed guru's you see on late night TV promoting this system. I guarantee you they never did it as a business!!!!!!!
You will spend all day buying junk for a few dollars then when you try to sell it for big money on eBay, no one will buy. Everyone knows about ebay and most of the stuff sold at yard sales and flea markets is stuff they cant sell on eBay. If they could, they would not bother selling any other way.
Some false prophets tell you to run classified ads offering to buy items. That is another dead end. If you run an ad saying you want to buy gold watches, every nit-wit in your area will contact you and try to sell you a $2 gold painted Timex for $200. You will not know what it is until you meet them and then you have wasted your time. Plus, they will be offended and mad at you for not handing over a bunch of cash for a watch that is worthless and they will accuse you of wasting their time. Even if you buy a $200 gold watch for $100 you may only receive $150 on ebay at best so for all your trouble you only made $50 and now you have to do it again and again. You are making less than minimum wage when you total up your expenses and income at the end of the week even if you sell one watch every day! This is not how you make money on eBay.
The next place most people turn is to a wholesaler or a drop shipper. Wholesalers sell you items at a discount if you buy a lot of stuff from them. One XYZ model mp3 player may cost $100 but if you buy a case of 100, they may charge you $55 each. Now all you have to do is sell them on ebay for $75 right? WRONG! Take a look at the ebay listings and you will see other people selling the same item for $55 and even less. How is this possible? Simple, the REAL price is not $100. That is a lie told to you by the wholesaler. The real price is the street price, what it is actually selling for, not the MSRP or suggested price.
I fell into this trap with Ingram Micro(a major drop shipper). I paid them a $100 signup fee and only then did they let me see their listings where they were claiming a harddrive cost $200 retail and wanted to charge me $120 wholesale. When I checked the web, it was actually selling for $80 all over the Internet. They wanted me to pay $120 for a harddrive, then resell it for $80 or less? How is anyone supposed to build a business like this? You can see that the large wholesaler and drop shipper companies are never going to help you to build your business.
A drop shipper is a wholesaler that ships the items for you. This sounds too good to be true...and it is.
Pay a price half of retail and the drop shipper ships to your customer. You pay the drop shipper and the customer pays you. It sounds so appealing.
There are some legitimate or at least semi-legitimate drop shippers like Ingram Micro who provide electronics for major sites(major sites like buy.com). These companies will let you setup an account and they are happy to take your sign up money, but they know you will never make money reselling anything they offer because their so called wholesale prices are higher than street prices. They will never give you the good deals they give to companies that sign six figure contracts with them. If you have hundreds of thousands of dollars available, then you likely have no interest in setting up an ebay business. The drop shipper will take your $100 and laugh as you login the first time and see the 'real' prices they charge you or everything magically becomes unavailable when you try to order.
The truth behind Drop Shippers by Michael Ford
The question all eBay users ask when they want to start an online business is “Who is a good Drop Shipper?” or “Where can I find a Wholesaler?”
A drop shipper sells items to you at a wholesale price and when you order, they ship directly to the customer. There are some big name drop shippers who supply electronics and software to major online retailers. When you order from one of these retailers, your package is actually shipped from the drop shipper using the retailer’s information on the receipt. You may have noticed that when you receive items you ordered from different companies, sometimes they have exactly the same type of receipt in the box. This is because they use the same drop shipper and that drop shipper simply changes the company name when they ship.
A wholesaler is a company that will sell single items to you at a price below retail. True wholesale prices are usually at 50% below retail costs. You must purchase items in bulk and then re-ship them to your own customers.
These are the two types of companies every eBay entrepreneur dreams of finding. If you search eBay, you will find many claiming to offer such services and you may receive such messages by email but every one of these offers is a scam.
You sell item X on eBay, then you login to your drop shipper’s website and tell them to ship product X to the customer and bill you the wholesale amount. Your profit is the difference between the amount you sold the item for and the amount the drop shipper charges. At least that is how drop shippers are supposed to work.
The majority of drop shipping services are con games to obtain an up-front fee. Commonly you will pay $100 or more or pay a monthly fee to become a member. You cannot see what they offer or pricing until after you are a member. When you do login to their database, you find their items are junk, are overpriced, or are all listed as out of stock.
Drop shipping companies will never sell items at a large discount to individual sellers. Unless you are buying 10,000 items at a time or guaranteeing to buy $100,000 every month, you will never receive preferred pricing.
There are outright crooked drop shippers. These companies will charge up-front fees then when you try to order anything, the status will change to unavailable even if it was available ten seconds earlier. If you just sold this item on eBay, you have a customer expecting an item to be shipped and you have a drop shipper saying the item that was available is no longer available. This creates a serious problem for the seller.
Some of these dishonest companies have nothing but junk. They purchase items from China for $0.25 and then try to sell them to you for $7 while telling you the retail price is $30.
If you check eBay first, you will see that no one is buying the items that are already listed, and they are listed for much less, maybe even less than $7. No one wants a flower vase from China and no one in their right mind will pay $30 for one on eBay. These companies offer worthless products. If the products were good, they would be selling the products themselves. The companies make money by collecting your name to re-sell to other companies and by charging you a monthly fee. They know the average person will stay with their service three to seven months before giving up and canceling.
Don’t fall for the eBay drop shipper scam. If there were a good drop shipper, everyone would know. In my ten years on eBay, I have never found a good drop shipper. They are all either dishonest, incompetent, or they misrepresent the services they can provide.
This includes the ‘big-boys’ who drop ship for larger electronics and computer parts websites. Those sites make six figure deals to get better pricing. Then the drop shippers offer you the same service but they will charge you an upfront fee plus you must pay higher than retail price for your wholesale items. I have personally signed up and paid a $100 registration fee for a certain major drop shipper who offered a computer harddrive for $120 as their wholesale price but the same drive was selling retail for $80 at hundreds of sites on the web. Their so called wholesale price was higher than the actual retail price.
No company has any incentive to be a good drop shipper. If they could ship the items and they had good items to ship, they would sell the items themselves and would not need you. They will only offer good pricing to companies that buy hundreds of thousands of dollars per month from them. There are no good drop shippers.
The truth behind Drop Shippers by Michael Ford |
Here is another tidbit of information most eBay sellers find out too late: The lists floating around on the Internet are junk! The second list I have included at the top of the page is that very list.
You may have seen people offering eBooks for 99 cents which claim to have thousands of wholesalers or drop shippers. There are two types of such offers. One is a scam by dishonest sellers who sell lists of their own websites. They have the same website under 20 names so they always have some running even when others are shut down. They frequently offer free resale rights because they want other people to distribute their crooked list. Some are so lazy they do not bother making a real ebook and just send you a link to their website. It is a scam. Anyone who sells you a link to a website or sells you a list that promotes their own wholesale or drop shipper business is trying to rip you off. The second is a generic list from phone book listings.
This phone book list is sold under under different names and it is filled with junk information. The companies listed have no URL's which means the list was compiled from a source like the phone book back in the 1990's, before companies were using the internet. If you start calling or writing these companies, you will find out that many of them are out of business or moved.
Some lists actually still list wholesalers offering Audio Cassettes Wholesale. Such lists are clearly outdated. Before contacting any such company, do a web search for their name or phone number. If you do not receive a result, go to the next company. If they do not have a website, then you dont want to deal with them usually. One exception is if they are a small home business with a desirable product. You might have a good source that no one else can track down by a web search but you will have to be really lucky to find one of these niche markets. Something the older lists are good for is giving you ideas. You can see what is available and where you want to research.
You can use the free list I have provided and web search for the companies but I have a new list that contains updated listings and web links to the company websites and these were not sifted randomly out of a phone book. These are known wholesale, drop-shipper, and closeout companies. You can find more information on this special eBook on my Video Training Page . Go there now.
You may be tempted to try and buy a product you think is popular from a wholesaler, but beware. Selling harddrives, mp3 players, laptops and other items is a big business with a lot of competition including people who have been selling electronics a long time. They have a lot more experience than you do. This is not the place to start unless you have a product no one else can offer or you can offer a modified product no one else makes. I will go into more on this later.
What if you do go with a drop shipper and ignore my advice?
That would be a mistake but I know many of you will do it. First, do not sell something on eBay and then try to place your first drop shipper order. You will be in trouble with eBay and the buyer when you find out your drop shipper is a lemon.
Do NOT give your social security number to any drop shipper. Apply for a tax id number if you are an individual or use your corporate tax id number if you have formed your own corporation or llc. Never give your personal ssn to a drop shipper or wholesaler, they do not need it. They MAY need a tax id number. If they insist on your personal ssn and refuse the tax id number, then they are trying to scam you.
Place an order through the drop shipper for an item you plan to resell and have it shipped to your work or home address. Does it arrive? Does it cost more than you thought? Is it late? Poorly packaged? Does the drop shipper say it was shipped but nothing arrives? Placing an order for yourself will tell you how well the drop shipper handles their business. If you receive the item, just resell it on eBay to recover your money. You are just testing at this point, dont worry about making a huge profit yet, make sure you can resell reliably. You have the product in hand now and you can safely resell it without worrying about problems with the drop shipper. Do this for every item you want to resell. Inspect the item, try it out. Does it work?
Some drop shippers and wholesalers offer something called gray market merchandise. It is supposed to be lower priced items made for other countries or markets. It is not legal for them to sell new gray market items in a market they are not authorized to sell to. If they are, then they are not authorized resellers which presents new problems. Most gray market merchandise is simply falsely labeled to make you think it is cheaper than it really is. When you go to the supermarket and see a 50% off sign, it makes you think donuts are cheaper but they actually are the same price they have always been. When a shady company wants to sell electronics, they call them gray market to make you think you are in on some super secret back door deal.
Now we are back to the original question, what do you sell? You cant buy junk at yard sales and the big wholesalers/drop shippers are out to screw you. What do you sell?
All is not lost!
Now that I have debunked the biggest myths about making money on eBay, drop-shippers and wholesalers, you may be wondering how anyone obtains a product to sell on eBay. This is how you can do it:
- Make your own product
- Find a specialized niche wholesaler
- Re-sell someone else’s information product
- Modify or combine an existing product to add value
I hope you pay close attention to these 4 items because these are the ones that make you money on eBay.
Each of these methods allows you to sell a valuable item with little or no investment. You do not have to pay any upfront charges or membership fees for any of these either because you are in control. We will discuss these in more detail in future lessons.
I have come down pretty heavily on wholesalers but that was only for the big companies that advertise themselves as wholesalers or the fly by night scam artists claiming they are drop shippers. You can find good wholesale deals for individual companies that offer wholesale prices to their own distributors and for individuals who have a home based or small shop manufacturing business. These companies or individuals will not drop ship for you.
These are called Niche Wholesalers(2 above). They sell a specific item or a specific group of items that they often manufacture or have exclusive rights to. For example, you may find a Niche Wholesaler who sells only fly fishing equipment or another who sells a custom interface cable. The niche cable made me a lot of money on eBay.
I once sold a special scanner programming cable on eBay. At first I made them myself for $2 each but demand became too much so I bought a better version from the owner of the patent for $8 each and sold them for $29 each. These were in huge demand at the time and I could sell a white postal tub each day. This is the perfect example of identifying a product in a niche market that people want, and making it available. The owner of the patent was selling the cable to program Casio day planners. But, it also worked for several other devices like scanners. I took a niche product, sold it to a niche group at a big markup. I had no real competition either. Occasionally someone would try to offer the same cables but when they did, I just dropped my price until they stopped. I had become so big by offering these cables through eBay, that my website now carried most of the sales anyway.
You can do this too. Look for a specialty product that you can offer or that can be used for a purpose other than the original purpose. The cable I sold was originally for Casio but it worked for many other products.
Here is another example. There is a product called Novus that polishes plexiglas or acrylic to remove scratches. This product was originally developed for boats but someone realized that it worked great for restoring pinball game plastic. Now you can find this product being sold in the pinball parts groups on eBay. Someone took a specialty product, figgured out a new use for it, and sold it to that niche market.
A small modification to a product, some paint, or even simply renaming a product to appeal to a specific niche can turn into a gold mine.
Among these choices, making your own product is by far the highest profit and easiest. This is part of a new marketing trend called Information Marketing. Information marketing is a system that allows anyone to produce inexpensive eBooks, CD’s or audio files, video files or other digital products quickly and easily which they can then re-sell at extremely high mark-ups. You do not need any previous experience in these fields. It can be as simple as talking about a topic you are familiar with and letting someone else do the work. Some of the advantages of Information Marketing are the low startup cost, sometimes zero, ability to target niche markets that have little or no competition, ability to test a market without any risk, and the ease of producing a valuable product at a low per unit cost. I will cover this in the next lesson.
You can find more information explaining how Information Marketing works in Lesson 2.
SPECIAL
I have put together a Case Study on Wholesale Importing from China. This is my personal experience when I imported 1000 game consoles from China. I reveal who I bought from, what went right, what went wrong, and how you can do the same thing. Buying items from China is very inexpensive which means you have a lot of room to mark-up your price. Buy items for 25 cents and sell for 25? Sound outrageous? Where do you think many of the products you see on late night infomercials come from? What do you think they cost? Most of them cost from 25 cents to a few dollars and they sell for high prices. You may not be able to afford an informercial but you can list them on eBay.
This Case Study also includes other first hand wholesale experience I have had with major wholesale companies. If you ever hope to play rough and move into the big money areas of eBay, you had better know the pitfalls and the techniques to assure success before committing your hard earned dollars to any wholesale venture.
This eBook also includes a list of wholesale companies in China who are offering the hot items that you see on eBay all of the time but did not know where they were comming from. I am even revealing the companies in China I have personally purchased from. This eBook previously sold for $29 alone when it was first released.
Are you still confused about what to sell on eBay? I have a video tutorial for you too. This tutorial was produced by my good friend and eBay entrepenur, Jack Willis, and he has given me permisison to make it available to you for a limited time. This online video series will explain a lot about how eBay works and how it can become a place for your business and give you many ideas about which direction you should take first to start a successful business. It is filled with more suggestions about products you can offer.
NEXT STEP
Tomorrow, I will send the next lesson with more information about how to start your own eBay business.
Next |
