eBay market research and product sourcing are one of the keys to succeeding with your dropshipping business. Since dropshippers don’t own any inventory, they look for new profitable dropshipping products all the time and try to keep their store up to date with the current trends.
There are many ways eCommerce sellers decide on what to sell, but eventually, they all follow the same rules: locate a demand in the market then find a supplier, and then source products from relevant suppliers to answer the demand.
For the eBay dropshipping business model there are mainly two tactics to finding what to sell. The first, which this article focuses on, is the sniping technique which is simple, free to use and brings quick results.
The second method is called niche research and it requires a paying subscription to eBay’s research software Terapeak. While this article will only cover the sniping technique, the product research masterclass video covers both of the methodologies.
If you are interested in eBay dropshipping but haven’t started yet you should know that finding profitable dropshipping products to sell is only one of the first things you need to do. You also need to set up an eBay store, PayPal account, and a dropshipping software account by following the 5-steps configuration guide for eBay dropshipping beginners.
As I mentioned, this guide will show you how to find profitable products step by step using the sniping technique. But before we talk about how it works let’s understand why it works. It works because of the powerful concept of online arbitrage.
What is online arbitrage? (aka retail arbitrage)
In a nutshell, online arbitrage is when you take a product from one online store (e.g. AliExpress, CjDropshipping, Amazon, etc.) and sell it on another marketplace (e.g. eBay, Shopify). As a result, you get a profit based on the price difference between these two markets.
In the example below of dropshipping from AliExpress to eBay, the product on eBay was sold 37 times for $22.31 which means this seller made $825.47 selling it. According to the listing on eBay the item is located in China, I guess that if it would be located in the US it would be more expensive but 37 sales means that people don’t mind waiting for the package to arrive from that far.
Look how much it would cost to buy it on Ali Express. The product cost is $7.99 + free shipping. Even after paying a 10% eBay selling fee, a 4.4% PayPal fee, and a $0.3 transaction fee you still make a $10.79 profit per sale. Times 36 sales. That’s a $399 profit.
So without further due, let’s see how to find profitable dropshipping items like this one for you to sell in your eBay dropshipping store.
The best way to find profitable products for eBay dropshipping
The dropshipping inventory of your store should include products that were sold multiple times only recently. Why? Because products that sell are products that people search for, and search demand is what eCommerce stores are fighting for.
But it’s useless to find products with high demand if you can’t find a supplier to sell you them for a cheaper price. You need a mechanism that finds products with high demand, but ones that have a high potential to be sourced for cheaper on another website.
The most popular technique to find high demand products that are likely to be sourced for cheaper from another website is the sniping technique.
How to use the sniping technique to find products for dropshipping?
The sniping technique consists of 3 steps that are simple to follow and can be done again and again to find new profitable products to sell.
- Find other dropshippers that generates sales
- Analyzing their store to find their best selling products
- Source their best-sellers for cheaper from the same website they are sourcing from.
Open a new tab in the browser and follow the instructions step by step, within a few minutes you should end up with at least one awesome product to sell as well.
Step 1: Find Other Dropshippers
Open Aliexpress.com and either type a few keywords of your choise in the search bar or click on one of the categories. Then, sort the results by the number of orders to get the products that sold the most for that niche.
In the example below I entered the keywords garden scissors and sorted the results by the number of orders.
Products that sell a lot on Ali Express are typically also dropshipped on eBay. Pay attention here, because I didn’t say they make sales on eBay I said they are dropshippers on eBay.
Just because other dropshipping sellers try to sell them it doesn’t mean they succeed to do that. But it does indeed mean that we can use these products to locate those dropshippers.
Take the first 10-15 keywords from the title of one of the products in the page and search it on eBay. Click on the advanced search button and set up the following settings:
- Minimum price of 30% above the price on Ali Express (use a calculator to multiply the price by 1.3)
- Item location set to China
We use these settings for two reasons: First, dropshippers will offer products using keywords similar to the ones we search with at least 30% markup to cover the selling fees and make some profit.
Second, we look for dropshippers that source their products from Ali Express, they have to set the item location to China.
How to locate dropshippers from the eBay search results
When you use the advanced search feature on eBay the search results contain up to 200 listings per page which are 200 potential dropshippers. But not all of the sellers in the page are dropshippers.
To locate potential dropshippers quickly, focus only on sellers with more than 25 feedbacks but less than 5000 feedbacks. You can see the seller feedback rate on the right-hand side of the listing.
To verify the suspicion check the location the seller is from by opening their store. If the seller is from a European country or from the US, selling products for 30% markup most likely from Ali Express – you just found a dropshipper.
Open the product page of those listings and then locate the seller name on the right-hand side of the product details and click on the name of the seller.
Then check the seller location to find out where are they from. In the example below the seller is from Lithuania where there is a huge community of dropshipping sellers.
Other big communities are Israel, Greece, the UK and the USA but basically any country that isn’t in Asia might mean it is an Ali Express to eBay dropshipping seller.
Step 2: Analyze the store to find the best-sellers
While I call it the second step because I want you to understand the process how the sniping technique works, this step only takes a few seconds.
Download and install the Chrome extension eBay popularity sort and then click on the button Items for sale in the eBay store of the dropshipper you’ve found.
The items in the store will be sorted by the best-sellers automatically by the Chrome extension.
To tell if a product is worth sourcing open the product page of that product and click on the number of sales next to the product price.
The sales history of the product will show up, validate that it was sold at least 2-3 times in the past 30 days. In the example below the product I found was only sold once in the past 30 days, but I still decided to try to source it, and I want to explain why.
I did this research during November and I know that Christmas is coming and it’s a commonly used product during Christmas I would still try to source it as I expect the demand for it to grow.
While I tend to recommend to stick to the guidelines when you look for winning products, you don’t have to do it like a robot. Leave some room for common-sense judgment in the research process, enjoy it.
When you decided on a product you want to sell it is the time to try sourcing it from Ali Express.
Step 3: Sourcing the best-selling products from Aliexpress
To source, the products easily, install Ali Tools, one of the best Aliexpress Chrome extensions. Then, enter one by one the product pages in that store and Ali Tools will automatically search the product for you on Ali Express.
You can try to sort the results of Ali Tools by “popular first” or “cheap first” and open a few of the Aliexpress suppliers that you find. Open a few tabs with the cheapest and most popular sellers to be able to choose the best supplier and outperform your competitor.
All that is left to do is to decide on from which supplier you want to source the product and to list it to your store.
How to find a profitable dropshipping supplier on AliExpress
When choosing a supplier on AliExpress there are three things you need to evaluate
- The quality of the product
- Whether the cost + shipping is profitable
- The reliability of the supplier
Evaluating the product quality
The product is evaluated using the product rating and its reviews. The best way to get the most reviews for the product is to open the page of the AliExpress supplier with the most sales.
The rating of AliExpress products goes from 1 to 5 stars, next to it you can find the number of reviews the product has. A product with over 100 reviews and a score of at least 4.5 stars should be good enough for a product to source.
Finding which suppliers are profitable
On Ali Express, much like on eBay, each product has more than one seller that offers it. In many cases, the seller with the most sales might not be the cheapest seller. Once you verified the quality of the product look for a cheaper supplier by sorting Ali Tools by “cheap first”.
But it’s not only the cost of the product itself that determines the profitability of the product. Ali Tools shows price before shipping so you want to compare the total of price + shipping.
Open the product page and click on the shipping carrier under the “quantity” section. A popup will appear with the different carriers. Choose a shipping method that offers a tracking number like ePacket Ali Express standard shipping.
To make sure the product is profitable use the free eBay dropshipping profit calculator created by the DSM Tool team to help you snipe products easily. Make sure to make yourself a copy of the file of the calculator by clicking File -> Create a Copy.
The cheapest supplier I found for the product I sniped offered it for $1.88 + $2.63 shipping. I just filled up the cost, shipping and price on eBay in the calculator and the profit margin was calculated for me automatically.
Look at the results I got in the calculator, eventually, the product I sniped was not profitable at all. I wanted to bring here an example that isn’t perfect
Every week we showcase on the DSM Tool YouTube channel 7 profitable products we sniped and we always publish more product ideas in articles like the profitable products for drop shipping from recommended niches article.
But in reality, not every search that you do is going to end up in finding the right product. So what you do when this happens? Move on to the next product. It takes about 2 minutes to get another product from the store or another seller to snipe from. Don’t give up!
Evaluating the reliability of the supplier
When you do find the most profitable product you should still evaluate the supplier. There are very clear parameters that tells you when a supplier is good or not.
First, good suppliers offers at least 90-day buyer protection which covers you for all of the cases of automatically-approved returns on eBay. For example, when the item that arrived is broken or the wrong item or even when it doesn’t arrive at all.
Some of the Ali Express suppliers might even offer free returns, these are suppliers that work with a local warehouse in the country you ship to. This is usually a very strong indication of a good supplier.
Last, there is the supplier rating and the number of sales this supplier made specifically with this product.
Make sure that whichever supplier you chose also had at least a couple of dozens of sales and a few positive reviews for the product. Also, hover with your mouse over the seller positive feedback rate next to the AliExpress logo to see a review of the supplier
Ali Tools also provides a seller score on the AliExpress page and it is recommended to set a minimum you don’t go under, like a score of 80-90%.
What to do with the products you sniped
The sniping technique is a simple and quick method to find products to sell on your dropshipping store. Moreover, it creates for you a list of sellers that you can continue following by entering their stores once in a while to snipe their most recent best-sellers.
I suggest spending one day a month going over the list of drop shippers you sniped from before. You can save them in the profit calculator file under the tab Competitors to follow.
There are also tabs to store the products you sniped, make a list of products before you list them to your store. Once you list the product to the store you stop doing research and by investing some more time in research before the listing process you might find some “rare gems”.
When you are ready to list the products to your store, make sure you follow the eBay SEO guidelines. Just like this guide, they will take you step-by-step through the best-practices of the listing process.