Free Guide to Facebook Marketplace Dropshipping [2023]

33 min read

Dropshipping is a popular type of eCommerce business that quickly got popular due to its multiple advantages. One of them is that dropshippers have no need to hold the inventory and invest much. This type of online business had its boom with such eCommerce platforms and marketplaces like eBay, Amazon, Shopify, Walmart. Well, now the Facebook marketplace dropshipping became super popular. More and more sellers search how to start to dropship on Facebook.

Let’s see why Facebook dropshipping is that popular now and, is it even lucrative?

Why Sellers Want to Dropship on Facebook Marketplace?

Facebook is a social media platform established back in February of 2004 — basically, it has been 18 years since it was first launched. Back in the day, the website was primarily used to connect with people. It was purely social-intended. 

Facebook Marketplace was first introduced back in 2016. The idea was for online users who wish to sell any pre-owned household goods or any product for that matter to other users at a reasonable price. It’s one of the leading platforms for social commerce to start with.

Picture Facebook Marketplace as an equivalent of eBay meets Craigslist. It’s easy to create an account and it doesn’t require personal information, only the product’s information when you intend to sell. 

Unlike Craigslist, from the buyer’s perspective, it’s much safer to purchase from anybody in Facebook Marketplace since the seller has a connected account where the client can view the person’s background — which gives an extra layer of safety and assurance.

However, the big difference is that Facebook has a large number of users. Everybody uses the platform. The website currently boasts more than 1 billion users from 90 countries.

The cool thing about the Facebook Marketplace is that it adopts a peer-to-peer system. it means buyers and sellers communicate via the Facebook Messenger app where the payments will take place as well.

That’s why nowadays, more online sellers are looking at this platform as a new profitable selling channel that is up to date. Dropshippers are not looking away from this opportunity. In fact, there are dropshipping sellers who benefit from this website where they gain a lot of success with their dropshipping stores.

One of the best things about this platform for dropshipping sellers is that it is completely untapped, meaning that there’s not high competition unlike other marketplaces such as eBay or Amazon — this is an unexplored goldmine for dropshipping!

That’s why online sellers are expanding their business through Facebook Marketplace Dropshipping.

How does Facebook Marketplace work?

Okay, let’s start by addressing the dropshipping model for those who are not familiar with it just yet. Dropshipping is where a seller does not hold nor pay for physical inventory. 

You find a profitable item with a high demand of sales on the marketplace and source it elsewhere for a cheaper price. That’s what we call “Online Arbitrage”. So in a nutshell, you purchase the product that you sourced from your chosen supplier and ship it directly to your buyer.

— The price difference will be your profit per sale. 

The best thing about dropshipping on any platform is that when the money starts to roll in, it becomes addictive — and fun!

However, keep in mind that scalability is always an issue that limits our business from expanding beyond a certain point. Continue reading in order to understand how to pass that plateau.

Facebook Marketplace – a powerful organic traffic generator:

Facebook Marketplace is a powerhouse when it comes to organic traffic. According to Statista, Facebook has reported a grand total of 1.93 billion daily active users during the third quarter of 2021. 

Facebook Marketplace registered more than one billion monthly global users in the first quarter of 2021. Furthermore, Facebook stores reported an average of one million monthly global users worldwide — so we’re now clear that Facebook is an eCommerce powerhouse.

Being this said, the level of traffic a Facebook store receives is enormous. That’s why dropshipping sellers are entering this market — because they’ll have up to 4 times the amount of views on their listings!

Now that you’re convinced about this marketplace, let’s dive into the requirements of Facebook Dropshipping.

Facebook Dropshipping Requirements

The first thing we need to understand before learning Product Research for the Facebook marketplace dropshipping and listing items in order to make sales on Facebook, it’s important to know exactly what is required to start Facebook dropshipping. 

Even though almost anybody who holds a Facebook account is able to start selling on the marketplace, there are still a set of rules you need to know to start to sell on Facebook.

Here are requirements for selling on Facebook:

1. The importance of a US Citizenship: Facebook will confirm the American citizenship through the seller’s Social Security Number (SSN). Although at first, you’ll be able to sell with this verification, once you hit the $500 sales benchmark, Facebook will require SSN verification. 

— Think of this step like your Selling Limit. You can only sell too much before hitting a glass ceiling.

If you’re not able to provide this information, Facebook Marketplace won’t allow you to list anymore and place payout holds on your account. 

Lastly, you’ll need to connect your account to a US bank account. However, Facebook also accepts payments through Payonner. 

What about non-US citizen dropshipping sellers?

For non-US sellers, Facebook will place a limit on international sellers. This means that a dropshipping Facebook seller would be able to list items in a single location compared to the shipping options available to US citizens. 

Nonetheless, there’s an answer to every international dropshipping seller. Even though you may have limitations, you can run a Facebook dropshipping store in addition to an eBay store. 

— Think of it as a dropshipping side hustle. 

2. Starting capital for the Facebook Marketplace Dropshipping: Just like an eBay store, there’s a small working capital you should start with. In Facebook, it is wise to set aside a budget range between $150-300 — this amount is not set in stone, however we found it best to start with a low budget capital like this one. 

The reason being is that the marketplace tends to delay payments for every seller until a couple of days after your client receives the product they purchased. 

That’s why you can start with low capital to pay for the order in the meantime. This will certainly ensure a smooth and steady cash flow at the beginning.

3. Shipping & handling: It’s important to note that Facebook such as Amazon, requires sellers to ship out items within a 2-3 days shipping time frame. That’s why it is crucial for dropshippers to choose a good US dropshipping supplier that’ll ship out the products on time — Continue reading to learn what are the best US suppliers you can choose to work with.

The most straightforward method involves listing the item and checking out the “Delivery Method” window in order to see whether Facebook offers the shipping option or not. 

A dropshipping seller can learn what items offer shipping options by going to the Facebook help page. There are certain products that unfortunately will not be eligible for the shipping options to international dropshippers:

How to set up a Facebook Dropshipping Store

Alright, so you now learned a few things about the Facebook Marketplace and what requirements you’ll need along with where you stand in terms of your scalability rate. 

In other words, if you’re an international dropshipper you’ll encounter certain limitations. Therefore it is wise to have a Facebook store aside from an eBay or Shopify store. 

— Now, it’s time to set up your Facebook Marketplace selling account.

We would advise you to do the following process in order to have a successful Facebook Dropshipping Store:

1. Create a Facebook page for your Business and/or store: 

Be sure to at least post 2 per day in order to maintain some content flow on your page. Post pictures and/or information about the products you offer. You can go more serious about it and recreate viral content to get more engagement. It’ll certainly help you with the traffic you’ll be reaching organically. 

Another great thing about a Facebook page is that it offers a wide variety of budget-friendly advertising tools you can use and invest in order to further scale your business.

If you’re thinking about how to create a marketplace app, you can try transferring these advantages of Facebook to expand your own business through an app.

— In short, it’s a great way to professionally promote and manage your business.

2. Connect your Facebook account to a Dropshipping Management Tool:

The best way to manage any eCommerce business is to successfully automatize every process. You can automate anything from order fulfillment all the way to customer support. That’s why we recommend you use the DSM Tool for your Facebook Dropshipping business. 

DSM Tool is in the final stages of developing a program specifically for Facebook Dropshipping. We will announce it very soon — stay tuned!

via GIPHY

3. Product Catalog setup: Start to add products to your Facebook store

You’ll need to add your product inventory to your Facebook store. Further on this article, we will be explaining how to properly do Product Research and add products into your catalog. 

For now, I’d like to address how the Catalog setup method works.

There are several ways to add products into your catalog, the method you choose will depend upon several factors — such as inventory size; For example.

As you can see in the image above, if you’re starting your Facebook dropshipping business, it is best to start uploading your inventory manually. As you grow, you can move forward to synchronizing with an eCommerce platform.

You also have the option to upload inventory through the DSM Tool — which is best recommended. We’re currently working on developing a program for Facebook Marketplace Dropshipping which will be dropped very soon. 

— Continue reading to learn how to upload your inventory manually once you’ve sourced a product you wish to sell.

Now when you checked different recommendations for the Facebook dropshipping inventory. Let’s learn ways to research what to sell on Facebook.

Facebook Selling Fees

Just like any other marketplace, you’ll face selling fees you would need to take care of. The Facebook marketplace is not different. So, whenever you make a sale, Facebook will deduct a fee directly from the payout automatically. The Facebook selling fee is 5% or a flat fee of $0.40 for products sold for less than $8.

Think of it this way, if you sell a product for $10 or more, the selling fee that will be applied will be 0.50 USD. If you sell the product for less than $8, the fee deducted will be 0.40 USD — the rest is yours to keep.

This will include the following:

• Taxes.
• The cost of payment processing.
• Applies to all checkout transactions for all product categories on Facebook and Instagram.
• Helps fund other programs for a good buying and selling experience.

— You can learn more about Facebook Selling Fees here.

If a customer files a chargeback, Facebook will place a hold on the transaction amount until the chargeback has been resolved.

All Facebook fees will appear in your financial reports.

Product Research for Facebook Marketplace Dropshipping

Now that we know how to set up a Facebook seller account, let’s start with the most important process, what to list & sell in your store.

The good news here is that since Facebook Marketplace is relatively new, it’s easier for dropshippers to find high-demand and profitable products to list in their stores compared to eBay, Walmart, and/or Amazon.

It has lower competition levels when it comes to dropshipping. Especially compared to a far more saturated market such as eBay — so you won’t have any problems capitalizing on your listings. 

So, now I will show you exactly how to find profitable items from eBay and Walmart that are selling well on the Facebook Marketplace. 

In addition, you’ll learn how to properly analyze a niche market and/or product on both sourcing marketplaces — eBay and Walmart. It will give you an idea of demanding products for dropshipping.

eBay’s Terapeak for Product Research

The first thing we’ll do is to access eBay’s Terapeak through the eBay Seller Hub.

Let’s keep it simple by using 3-4 keywords on a product you would like to analyze. Since it’s February, let’s use the following keywords: “Valentines Teddy Bear” which is under the “Bear” category.

When you type in the magic keywords, you’ll be able to filter the options. In this case, I’d recommend you to filter the item’s condition and format. The reason is that eBay is a marketplace where users can either sell at a fixed price and/or bid on items. Furthermore, the products can be new or used. 

When it comes to the condition you can choose either one since a lot of products sold on Facebook Marketplace are either new or partially used. However, when it comes to the format, always choose “Fixed Price”. 

Once you have placed all of the filters, I’d recommend you look for the items sold within the last 7 days. That way you know what are the hottest products or the most popular. Whenever we’re analyzing an item, it’s best to analyze the number of sales in the last week or month — at most.

Now you have the results and you’ll be able to find different Teddy bears or any Valentine’s Day-related products. 

Lastly, choose a product that has more than 4 sales. The reason being is that you want an item that has a high sales demand — that’s always a good indicator. 

As you can see on the image above, I chose the Teddy bear that has a total of 31 sales. 

Searching Products on Walmart:

We’re going to do the exact same thing on the Walmart marketplace. Let’s try to find the same product that we found on eBay or at the very least, something similar.

We’re going to grab a couple of keywords from the chosen product on eBay. I will be using “Giant Teddy Bear Big Stuffed Animal” which I grabbed from the product’s title on eBay’s Product Page. 

The use of filters is not that necessary once you have a specific set of keywords — like in this example.

As you can see, we already see the exact same Teddy bear variation as we saw on eBay. It even has somewhat the same price tag. 

You can also apply the same tactic on other marketplaces: you can source the same item on one of the US suppliers I gave you earlier in this article. 

Here’s a side by side comparison between both options:

There are two big differences between both options: Price & Shipping estimation timeframes.

The seller on eBay offers the product at a higher price but the shipping time frame is quicker than the seller on Walmart who offers the product at a lower price. 

Is this relevant? — To be honest, it isn’t unless you want to be more strategic about the shipping delivery dates and/or pricings when listing dropshipping on Facebook. 

Analyzing Facebook’s Market

Now that we found a product we would like to source, let’s find out if the same product is being sold on the Facebook Marketplace, how many sellers are offering the item and at what price. 

Let’s use the same keywords for the specific Teddy bear we found on both eBay and Walmart: “Giant Teddy Bear Big Stuffed Animal”. Remember to use the filter options on Facebook.

We need to filter:

• Location: Facebook works by showcasing listings depending upon the location of sellers & buyers. That is why if you’re an international dropshippers, you’ll need to focus on one location — is part of the limitations you get when Facebook Dropshipping.
  
• Price: Choose a price range that will target the prices you found on the sourcing websites. In this case, anything between $20-70 should be a good ratio.
  
• Item condition: Choose the “New” option since it’s the same option we chose at the beginning when we were sourcing a product. 

— This is important because we want to figure out if anybody else is offering the same product at the same price and determine if it’s worth listing at all. 

Once the search results come in, you’ll see various similar options. Try to scout the same product by choosing the picture that fits with the other images on eBay and Walmart. Lastly, make sure that the price offered on Facebook is higher than your sourcing website. 

— Remember that we want to be competitive in terms of pricing as well. In which we want to offer the product at a lower price than our competitors and still gain profits out of the deal. 

Furthermore, the client can analyze what the seller offers along with sending predetermined messages if the buyer is interested in the product. From a user standpoint, it’s a safe deal since they’re able to even see the seller’s profile. They can even check out the seller’s listings as well. 

— This means that you as a dropshipper have to have a professional-looking Facebook Page in order to provide that sense of security to buyers. 

So, taking this example, let’s do quick math:

If we source the product from eBay, we’re looking at a cost of: $59.99 with free shipping. If we sell it on Facebook Marketplace cheaper than our competitor, we could sell it at: $65 (two dollars cheaper), we’re looking at a potential profit margin of $5.01 per sale. 

If we source it from Walmart, we’re looking at a cost of: $50.99 with free shipping. Obviously from a financial standpoint, we might be able to square a higher profit margin if we sell it for the same $65. Giving us a total of: $14 per sale.

We can even lower our offering price to lure more potential customers and still gain a good amount of profit.

Lastly, if we choose to source it from eBay, the product’s arrival would be sooner than the product offered on Walmart.

The seller on eBay has a shipping estimated arrival date between Feb 14th & 16th. Meanwhile, the seller on Walmart has an arrival date of Feb 23rd — you’ll gain more competitive advantage by selling cheaper and shipping faster. 

That was our quick explanation of how to do product research for your Facebook dropshipping store. But we still are left with an important question. From where to dropship on Facebook?

Best US dropshipping suppliers for Facebook dropshipping

One of the most important decisions which dropshippers do is to choose which website and/or supplier to use to resell products from. Why it is important? Because your supplier is responsible for the quality of products, their fast shipping, and if needed, returns.

As I have mentioned, your supplier should provide quick shipping. Otherwise, you will not pass the Facebook marketplace requirements for sellers.

That’s why, in this section, I will list at least six US dropshipping-friendly suppliers you can decide to source from when you’re executing your Product Research. 

1. Wayfair for Facebook dropshipping

Wayfair is a dropshipping-friendly eCommerce supplier that specializes in selling Furniture & Home-Goods, rich dropshipping categories. It has warehouses around the world. They offer fast two-day shipping within the US, making them a top choice for the American consumer.

Quick reminder, when it comes to the best dropshipping suppliers, you’ll have far more options than just US retailers. There are tons of international suppliers who offer fast shipping since they have warehouses around the world. 

2. Costway as a supplier for Facebook Marketplace

Costway is a retailer of various goods — the company itself does not produce anything. There are a handful of benefits while working with Costway. For example, you’ll have free shipping on everything. 

Not to mention Costway will have a Dropshipping Agreement with sellers such as yourself — learn more about it here.

3. Overstock as a supplier to dropship on Facebook

Overstock is another dropshipping-friendly US retailer that offers fast domestic delivery along with easy PayPal transactions. 

Another advantage this supplier has is the 24/7 online support live chat where if you have any issue with an order, you’ll get a quick response. 

4. Walmart for Facebook Marketplace dropshipping

Walmart is a good option as well. They are one of the biggest online retailers in the US. Furthermore, they have a Next Day Delivery service you can use. 

It’ll cost a little bit more meaning that you would need to up your price on Facebook Marketplace in order to include this fee but — it can be worth it!

Here’s a how-to guide on how to dropship from Walmart into eBay. However, it can also apply to Facebook Marketplace Dropshipping. 

5. Dropshipping from Amazon to Facebook

Amazon is another huge online retailer that many dropshippers use to source their products from. Furthermore, it’s another marketplace where you can start selling as well. 

Like I mentioned before, when you’re dropshipping on Facebook, you have limitations. Therefore you can have dropshipping stores elsewhere — learn more about Amazon Dropshipping & Product Research here.

Their Prime products ship within two days for anyone with a Prime membership, enabling fast delivery and satisfied customers. 

6. Dropshipping from eBay to Facebook Marketplace:

One of the best features eBay has for product sourcing is their Marketing Tool, Terapeak. With this awesome tool, you’ll be able to determine trending niches and high-ticket products.

This means that you’ll be able to source profitable products to then dropship them into Facebook Marketplace. You can even have an active eBay store and upload the same eBay listing to your Facebook listing.

How to list a product on Facebook Marketplace

Alright, so now we’ve learned how to source profitable products. We chose our supplier and we chose our item. It’s time to upload it to a Facebook listing. 

DSM Tool is currently in the final stages of developing a great Facebook Dropshipping program that’ll allow you to easily source and add to your Facebook listing profitable products. 

Furthermore, it’ll help you automatize every process of managing your business. It’ll help you properly optimize your listing with the best long-tail keywords for the product’s title, product description, image optimization, etc. 

That’s why, for now, I am going to show you how to manually upload a product.

Here’s how you upload inventory manually to your Facebook shop:

1. Log in to the Commerce Manager.
2. Click on Catalog.
3. Click on Add products.
4. Select Add manually.
5. Enter product information in the corresponding fields.
6. Add categorization details about the product, such as its condition, brand, and tax category.
7. Add delivery options and return policy information.
8. Add options for any variants, such as colors or sizes.
9. Once you’ve finished, click Add product.

Create Great Product Listings on the Facebook marketplace

It’s important to note that when it comes to Listing Optimization, you’ll need to create accurate, detailed product descriptions. This will certainly help you boost traffic to your products and lure potential customers into purchasing your item. 

To create your product listings, you’ll need to assemble four key components:

• Good product images: Make sure that the supplier you’re sourcing from has professional-looking pictures.
• Detailed product descriptions: Good descriptions should be chock-full of details that sell your product, plus any sizing, measurements, weights, or other necessary details.
• Product size and weight information: These numbers can be entered with your product information in most eCommerce systems, so you can print accurate shipping labels. It’s optional but can be useful.
• Product tags: As you may already know, Facebook and any social media outlet has an algorithm that works with certain key tags. Keywords on the product’s title is not the only powerful way to increase traffic. On Facebook, tags or hashtags will have a huge impact. It will help you define & reach your target audience

— Let’s put these points to the test and list our Teddy bear, shall we?

I’ll be sourcing the product from eBay’s seller page due to a better shipping time frame. So what you do is the following:

1. First, click on the option that says “Create a new listing”:

2. Choose the Listing Type. In this case, it would be “Item for sale”:

3. Then simply start filling out the information such as: Images, title, price, category, etc. You can find all of this information on the seller’s Product Page of the sourcing website. 

You can save all of the images displayed there and upload them on your Facebook store. You can also find on the Item Description all the product’s information such as: Length, material, characteristics, etc. 

— In short, gather all the information possible to describe your product.

4. Add the title. Choose a range between 8-15 keywords for your title. You can grab a couple of keywords from the product’s title on the sourcing page. Furthermore, place your price as well.

5. Finish filling everything up. Choose the age range of the audience who would like and/or benefit from your product. Add the product category (Facebook will normally have a predetermined category depending on the item). Lastly, add a location where you wish to sell your product.

6. Review and publish. Double-check that everything is dialed in. Whenever you’re ready, publish your product.

Run Facebook Ads & Campaigns

If you want to invest some extra cash in your Facebook Listings, there are many ways, both free and paid, that you can market your Facebook Shop products to followers and larger audiences, including:

• Featuring products and specials via boosted posts — which are regular posts that, for a small fee, can reach a large, targeted audience
• Running Facebook ads.
• Distributing offers and hosting contests to engage your audience and attract new viewers to your page — is important since Facebook is a platform of engagement and Facebook Marketplace is no different.

Create High Quality Catalogs on your Facebook shop:

A catalog will contain the products you wish to dropship on Facebook and/or Instagram. Providing good quality content where you describe in detail what you’re offering will certainly help the customer discover your products and be more informed about their purchasing decision. 

— It will certainly help you as a seller to not only gain more attention and credibility. But it will also boost the confidence of your customers to buy from you.

Follow these best practices and tips for selling on Facebook in order to boost your sales and work on your store’s image:

1. Using only one single catalog for both ads and commerce on Facebook: It is best to keep your items in one catalog because it’ll be way easier to manage your inventory. Furthermore, it will help you build your audience for ads whenever you wish to invest. 
   
2. Keeping your catalog up to date: This is crucial, especially if you’re dropshipping on Facebook Marketplace. You need to keep your products within your catalog with every piece of information updated. Your inventory has to be in stock, meaning that you need to be checking back with your supplier. This also applies to any price change the item might have on your supplier’s end. 
   
3. Title and description optimization: It’s important to create a good first impression of your items through a winning title and a good detailed description. Avoid keyword stuffing, proofread for spelling, and don’t include any links in these fields.
   
4. Choose high quality pictures for your products: Use high-resolution images that are at least 500 x 500 pixels and show your items accurately. Normally, a lot of suppliers you choose to source from will have professional pictures of the product. Choose the best-looking ones. 
   
5. Link the products properly: Make sure that within your catalog, you place the direct link to your product properly. Make sure that the links begin with the typical “http:// or https://”.
   
6. Setting up the product’s variants: If you’re selling under categories such as Apparel, Home Decorations, etc. Make sure to include different variants of the item. For example; Sizes, colors, add-ons, etc. It’s important that these variants display correctly in the catalog so the user can take a better look at them.
   
7. Check if any of your products are rejected: When you upload your catalog, Facebook will review if your items comply with their Advertisement Policy and Commerce Policy. If they don’t, you can either remove the item or edit the product in a way it will comply.

— Try to follow the aforementioned steps above in order to properly showcase your listings on Facebook Marketplace. 

That way you can gain more traction whether it’s a paid approach such as Facebook Ads or an organic approach. 

Final thoughts:

Facebook Marketplace Dropshipping is a great untapped market for many sellers — including dropshippers, of course! 

The platform is growing as we speak, it has now a Metaverse project which will be huge one day. Small to big businesses have a presence on Facebook. What started as a social media platform where users can share their pictures, thoughts & more; Has become a business powerhouse. 

Facebook Marketplace definitely outdid the Craiglist concept and incorporated characteristics from huge marketplaces such as Walmart, Amazon & eBay. Nowadays, you can connect your Facebook store to Dropshipping platforms which will make your seller experience easier.

DSM Tool will deliver a user-friendly and effective tool to every drop shipper to help them successfully dropship on Facebook Marketplace. This article was made with the sole purpose of introducing you to the Facebook market, how it works, and why it’s a profitable goldmine. 

Additionally, you learned great dropship suppliers you can work with and/or source from. All it takes is for you to take your time evaluating options, doing your product research, and being on top of every single aspect of your store management. 

Now, start your Facebook business account and open your own Facebook store. Trust me, you will not regret it — Good luck!