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Massive monthly sales Dropshipping Amazon to eBay...How are they making profit?

Discussion in 'Ebay' started by Lxuke, Oct 23, 2014.

  1. Lxuke

    Lxuke Newbie

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    I have found two eBay sellers, one doing $800,000+ sales per month and the other doing $700,000+ per month.

    stores.ebay.com/thehoneyroastedpeanut
    stores.ebay.com/xaenterprises

    It is very obvious they are fulfilling the order with Amazon Prime, however according to my calculations they should be losing money after eBay and PayPal fees...

    The only explanation that I could come up with is that they are somehow receiving money from an Amazon or eBay affiliate account, although I'm pretty sure that's not allowed.

    Does Amazon or eBay have a special program or look the other way if you give them enough business?
     
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  2. toml3030

    toml3030 Elite Member

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    If you're doing that kind of volume, most likely you are paying the fraction of eBay and Paypal fees that a smaller seller is paying. Also some big sellers use eBay to drive traffic to their own eCommerce site and their primary goal isn't to make money on eBay.
     
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  3. donaldwilliams

    donaldwilliams Newbie

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    Will check this out will post back with results.
     
  4. Lxuke

    Lxuke Newbie

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    cool looking forward to it!
     
  5. Soayame

    Soayame Regular Member

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    They are top rated sellers so thats 20% right there. I mean even if they make 1 dollar a profit its still 17k a month. Im down with that. I just wish ebay didnt have selling item limits because I can only list 200 a month :/

    Also I dont think they are using prime. I could be wrong though. Man thats some good money right there.

    The second guy on there he is making about 2 dollar profit from the few items I checked on amazon. So i mean thats amazing as far as the prime u can get those im sure with different student emails for free and other ways. hmm he has 19k feedback so he is atleast making 19k a month i just wonder how many hours a day he would have to put in with all those orders.
     
    Last edited: Oct 24, 2014
  6. STAUNCH

    STAUNCH Junior Member

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    It should be a lot of waste of time. For these years for building those FBs, etc. - and money in the bank - he should already understood that in order to overextend and overexpand he needs a warehouse + stock/inventory + contracts with big suppliers. So then he'll earn alot more and stop being a "dropshipper", huh.

    Of course, opening an e-store website based on some e-cart software.
     
  7. toml3030

    toml3030 Elite Member

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    I'm pretty sure that if you're big enough to move that kind of volume you get discounts that are not advertized.

    I know someone that averages about 500 packages in december (500x30=15,000 packages) and it takes him 1 full time employee and and two part timers just to inspect and pack every day.
     
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  8. toml3030

    toml3030 Elite Member

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    People have different business models. The guy in the above post got a small office in the area where all the wholesalers are and he only keeps the stuff that he sell at least 10 a day in the office. He has a full time guy just walking around the area and he will get an email every 10 minutes on he cell phone on what just sold so he'll just be walking around all day picking up individual items from each wholeseller and bringing it back. He says the entire wholesale district is his warehouse. Dude is meticulously organized. Most people could not run an operation like clockwork like how this dude does it.

    Then there is this other dude, who spent $400K setting up one of the most badass niche ecommerce sites I've ever seen. He carries about 8000 items and he keeps all items in stock at all times (must be at least $10m+ in inventory) He lists about 100 items on eBay at rock bottom prices just to drive traffic to his own site.
     
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    Last edited: Oct 24, 2014
  9. STAUNCH

    STAUNCH Junior Member

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    Who is "the guy in the above post", e.g. you?

    About the area - lol, that should be a huge benefit to live and be in a area with a lot of wholesalers.
     
  10. toml3030

    toml3030 Elite Member

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    I WISH i was that organized. Since I would totally f it up if I had to stay organized with that many packages flying around, my business model is trying to sell high quality stuff that is 10x more expensive but offering high degree of customization.

    It's not that difficult if you live in a large city. Within 3 miles of where I'm sitting right now, there is a garment district, a fashion district, a toy district, a jewelry district, etc. It's finding the right niche, finding out what your advantage is, and pounding away at it.
     
  11. MNICMB

    MNICMB Newbie

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    Wish I had a decent dropshipping that took a feed from my eBay account and just fulfilled orders when they were sold!
     
  12. toml3030

    toml3030 Elite Member

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    IMO, the only way to run an eBay business if you do that kind of volume and feel safe is to ship yourself.
     
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  13. Defon

    Defon Regular Member

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    I love this post. I know the first seller (not personally but I watch him all the time).

    These guys are doing a method alot like mine but they are much bigger.

    1) Basically they get credit card rebates on each purchase. 1% to 10% depending on a few factors.
    2) Reduced ebay and PP fees
    3) AUTOMATION- custom cloud based software that orders and tracks the pricing of items. The first guy even has a price tracker that will adjust prices automactically using ebay API. When amaonz price goes up, his price adjusts to to keep it profitable.

    This is a monster project. I would guess he paid $5k to $20K for the trackers and custom stuff... probably has been built over years.

    The other thing to consider is when buying alot of stuff on AZ prime (OR ANY site for that mattter), AZ will ban your prime account with too many orders ESPECIALLY when the address SHIP to, is always different. So this guy would also need a bot (or cheap labor) to make 10 to 50 AZ prime accounts a day. Then load the accounts into his ordering software. Plus he will need many different CC to buy and manage the payments.

    There are about 3 to 5 other big issues he has to overcome to make this work, but I don't want to give away all the tricks.

    he is making $20k to $30k a month. But I assure you he works 30 to 60 hours a week and has 3 to 5 employees (probably work for $5 a day each).

    This dude is crushing it... but there is no free money out there. This system is hard work.

    :)
     
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  14. jasonbourne69

    jasonbourne69 Newbie

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    thnx Defon for the detailed input, i was looking at the stores and some products were like $0.50-1$ profit , i thought wow thats very little for the amount of time he would spend searching for the item , i also noticed some items for over $100 that cost around $10 on az , probaly to avoid buyers from getting them and not having to manually remove listing . it sucks how oversaturated the market of dropsshipping is , one side you have the chinese manufacturers selling it themselves and on the other the amazon prime. with the amount hes selling from amazon i woulndt be surprised if he does have a az affiliate account , its very easy use one computer to post a link on twitter use the other computer to buy it and ship it to ebay , sounds like an epic operation !
     
  15. wanted4knowledge

    wanted4knowledge Registered Member

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    Two problems:
    1) eBay asking for supplier invoices
    2) Amazon won't allow you to order 30+ orders a day with same credit card

    I can't see how he bypasses these, any idea?
     
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  16. STAUNCH

    STAUNCH Junior Member

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  17. toml3030

    toml3030 Elite Member

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    His profits maybe more than that. I was once considering an item that cost $10 wholesale and retails about for about $15. Very little profit after eBay/paypal fees right? Then I found out that if you go to the country where they manufacture it, and pay them cash on the factory floor and can arrange for your own shipping to the US, you can buy them for $3 a piece. If you're selling 10 of them a day and you're doing it with multiple items, you can do this sort of stuff.
     
    Last edited: Dec 17, 2014
  18. toml3030

    toml3030 Elite Member

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    If you're doing massive volume, you can pay to set up a paper company in Hong Kong to write you all the invoices you need.
     
  19. awfulsad

    awfulsad Newbie

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    does ebay not allow dropshipping? or dropshipping from amazon?

    if they allow, when requested for supply invoices he can just provide the amazon receipts because he has the supply, the customers are getting the items.

    what ebay does say is that you are supposed to include the items location. which i assume would not be possible since amazon would ship from various locations.
     
  20. toml3030

    toml3030 Elite Member

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    eBay frowns on drop shipping, in general unless you can move millions of $ in merchandise, the problem is Amazon does not allow drop shipping so if you provide Amazon invoices, you'll get banned on eBay for that anyways.