Hi Andrew,

My name is Tom, I’m 18 years old and would like to start a small online business to make some extra cash.

I only have 200 quid to spend on stock so I was thinking maybe to start off on eBay using dropshipping concept? This way I could sell higher priced items without initial money outlay.

I would love to buy stuff wholesale but don’t think my budget allows that.

What do you think? Is it a good idea?

Thanks,
Tom, UK

Hi Tom,

Thanks for your e-mail.

I won’t be original here and will repeat myself – I’m not a huge fan of dropshipping, never liked it and probably will never like it. I just hate that feeling when I’m not in 100% control on what’s going on in my business and this is exactly what happens when you use a dropshipper to source & sell goods online.

Just few things that can (will) go wrong:

* Item goes out of stock after you have made a sale;

* Prices can increase without warning;

* Mistakes with packing/shipping orders;

And that’s not talking about prices at all! As you can imagine, if there’s a dropshiper, there’s another middle man taking a profit share. So obviously you can’t get best possible prices through this product distribution concept.

I know that there are many great, efficient and customer service orientated dropshippers out there but I just don’t think it’s the best business model out there.

Only way I can see dropshipping working at it’s best is if you deal with manufacturers directly. Yes, many manufacturers, especially in the US do offer dropshipping programs. I’m talking about products like:

* Fitness supplements/vitamins;

* Bed mattresses;

* Dog houses;

* etc.

Stuff that will always be in stock, with best possible prices directly from manufacturers and so on.

So in your case Tom, take yet another look at cheap, small products you could buy in wholesale – you know, stuff you can buy for 10-20p and re-sell for 1-2 quid or even more! With products like these, even 200 pounds is enough to get started on eBay!

Why not start by visiting your local Cash & Carry wholesaler?

Good Luck!

Thanks,
Andrew

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