How to Increase Dropshipping Margins on eBay & Amazon
Transcribe of “How to Increase Dropshipping Margins on eBay & Amazon”
Hi guys, Neil Waterhouse. This week’s video is about, how to increase drop shipping margins on eBay and Amazon. As a host and founder of the four largest eBay and Amazon groups in Australia, with over 6,000 members, I get to see inside, not just our own drop shipping businesses, but also inside a lot of the members’ businesses as well.
Dropshipping margins: The difference between the dropshipping businesses, that make the higher margins and the one which make the lower margins
This video is about, what I continually see over and over. There’s a difference between the drop shipping businesses, that make the higher margins and the drop shipping businesses. Which make the lower margins. First of all, I see over and over, beginners want to sell small. Non electrical, cheap items with their suppliers offering free shipping. Now don’t get me wrong, I’m not saying that you have to sell large. Expensive electrical items, that don’t have free shipping to make high profits. When you drop ship on eBay and Amazon. That’s not what I’m saying.
Dropshipping margins: To make the higher profits, you need to be not doing what all the beginners are doing
What I am saying is, to make the higher profits. You need to be not doing what all the beginners are doing, i.e selling mobile phone cases, et cetera. Also, you need to be using different suppliers, to what all beginners are using. Using the well known drop your suppliers in your own country is an awesome way to get started. But due to the competition of all the beginners there, the margins are always going to be lower.
You must put in place a methodology
You must put in place a methodology, to continually add new suppliers each month and preferably an automated methodology using a part time low-cost, dollar or $2 per hour VA or virtual assistant as I mentioned many times before. Can get a part time, low-cost overseas virtual assistant for a dollar an hour, who can be doing this for you. Even if your virtual assistant only works for you say a couple of hours, a month, that would normally well and truly pay for their wage.
Our rule of thumb is to spend 10% of your profits, on virtual assistants
Our rule of thumb is to spend 10% of your profits, on virtual assistants, so that your business is always growing without you being there. If you want to know more about how to get overseas VAs from $1 an hour, I’ll put a link on the screen and below to a free guide. Also, I’m not going to show how to find more drops shipping supplies in this video, I’ve done that many times before, but again, if you missed it, I’ll put a link on the screen and below to that free video.
The next point is always check to see if your new supplier has a login or sign in button, on their website
The next point is, whenever you add new suppliers, always make sure that you and your VAs, your virtual assistants, always check to see if your new supplier has a login or sign in button, on their website. If they do, this is a giveaway that your supplier may have lower prices. If they have, they do that login or sign in button, you’ll normally need to register with them, to get a username and password. So you can then, login and see the lower prices.
Only use suppliers in your own country
And just when we’re talking about suppliers, if you’re drop shipping on eBay or Amazon, please only use suppliers in your own country. If you need to drop shipping, you’ve probably been told to use places like AliExpress in China to drop ship. Please don’t do this. Buyers on eBay and Amazon will not tolerate it, when their orders take weeks to arrive. Yes, I know in a perfect world, you can use couriers like DHL to ship items from China, to first world countries like Australia, USA, Canada, UK, et cetera.
The perfect world scenario rarely happens, especially now with COVID-19
However, the perfect world scenario rarely happens, especially now with COVID-19. I’ve been importing for over 30 years, it’s always the same. Customs you land in China for whatever reason, customs you lay in your country for whatever reason, pilot strikes, volcanic ash, et cetera. But now with COVID-19, it’s worse now importing on is by air that have ever seen it in over 30 years of importing. By the way with importing, for a non drop ship items we normally only ever used sea. Not here anyway, that’s a side point.
Whether importing by air, you know you’ve only got to look up in the sky to realize that there’s hardly any aircraft flying
Whether importing by air, you know you’ve only got to look up in the sky to realize that there’s hardly any aircraft flying. You know even here many times a day, you know, we get to see the contrails with the planes flying past, but none. This is nothing, you know, this is unprecedented. Before COVID-19, I was always saying to only drop ship using supplies in your own country, but now with, COVID-19, I urge you to not even dream about, drop shipping from other countries. Only use drop ship suppliers, who are located in your own country.
The next point is, what we call the one in 10 principle that is every 10th drop shipping items that you
Now the next point is, what we call the one in 10 principle that is every 10th drop shipping items that you, or your VA’s list on eBay or Amazon, should be a new item. And what I mean by that is, most suppliers have a section on their website, which shows their new items. If they are new, that means there’ll be no other sellers from your supplier’s website, listing those items. Which means if these items are exclusive to your supplier, you might have zero competition for those items. This means you can list them, or those items that are higher margin, I’ve 30 to 40%.
The next point to consider, is selling larger items
The next point to consider, is selling larger items. Most beginners think that shipping large items is a pain. However, like most things in life, once you learn how to do it, it’s not that hard. Especially with drop shipping, where your supplier does all the hard work and the shipping for you. You know, if you dropped it on eBay, all you need to do is set the postage rates table, which automatically calculates the shipping price from your supplier to your customer. So your Casper knows exactly how much the shipping is, without ever needing to contact you or ask you or send you an email, they just automatically can sit on their screen.
Most beginners, won’t do this as I think it’s too difficult
Most beginners, won’t do this as I think it’s too difficult. However, you know, everything in life, if we do something that beginners think is hard and the beginners don’t bother, you’ll find this foulness competition. This is exactly the reason why most beginners will not take the time, to set up the postage rates table. Again, I’m not going to go into how to set the postage rates table, and this video, I’ve gone and done that before, but again, I’ll put a link on the screen and below to another free video, showing how to set up the postage rates table, step by step.
Dropshipping margins: The next weight increase margins when drops shipping on eBay and Amazon
The next weight increase margins when drops shipping on eBay and Amazon, is to optimize the listings. It amazes me that over 95% of listings, are not optimized. Instead of getting to a price war with your competitor, which only ever goes one direction, beat them with optimization. Again, I’ll put links on the screen and below to free videos, showing how to optimize, eBay and Amazon listings. The next tip is, most beginners avoid electrical items like the plague. Personally, I love electrical items. I’ve been selling electrical items now for over 30 years and online for over 20 years. Consumers love electrical gadgets.
The next point is to make sure that you have, the right eBay store subscription
The next point to increasing your drop shipping margins is to if you’re selling on eBay, make sure that you have, the right eBay store subscription. eBay offers various levels of stores, including Basic, Feature and Anchor. With each of these stores subscriptions, you pay a monthly fee, however, you pay lower final value fees. And this of course can increase your margins. Bottom line, though. The biggest difference between sellers who are making low margins, I listed 10%, to sell it to a making the higher margins, I have 30 to 40%. Over and over, I see the same pattern.
Sellers who are making low margins, are normally only purchases from one or two suppliers
Sellers who are making low margins, are normally only purchases from one or two suppliers. Drop ship sellers who are making higher margins, normally always have a methodology in place to add more suppliers every week or every month. That’s all for this week. I hope this video helped you with, how to increase drop ship margins on eBay and Amazon. Please scroll down, let me comment below, and while you’re there, make sure you hit the subscribe button to the channel that teaches how anyone, can make a full time living from their home using eBay and Amazon. Until next week, stay safe. List more, sell more.Everyone uses eBay and or Amazon, but many don’t know how great they can be if you’re trying to make money.
Everyone uses eBay and or Amazon, but many don’t know how great they can be if you’re trying to make money.
Step By Step – Zero to Seven figures from home dropshipping using less than $100
https://www.neilwaterhouse.com/drop
Step By Step – Zero to Seven figures from home dropshipping using less than $100
https://www.neilwaterhouse.com/drop
In this video, multi-million dollar seller Neil Waterhouse how to increase dropshipping margins on eBay & Amazon.
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