Expert: Marvinator - 9/28/2006

Question
Does eBay allow drop shipping and do they outline it anywhere in their policies? Sounds like a simple question but is it? I would really like to know.

Thanks,
Keith

Answer
forgive the delay in responding to this question.  I have just 'discovered' the Question Pool myself.

Drop Shipping is allowed.  Though it is not expressly stated in the rules, ebay follows the FTC rule which says that you may sell any item so long as you are able to ship within 30 days.

Not a week goes by without someone asking me about Drop Shippers. Drop Shippers are a good way to go if you don’t mind the business of being in business. What I mean is that you need to consider several things about Drop Shippers.

First, You are not the only customer of the Drop Shipper. You are not among an elite group of 20-50 sellers either. The company couldn’t stay in business with just 20-50 clients. This means that you are selling the same things as hundreds to several thousand other Ebay sellers. Each of you is hoping for the same sales and probably the same clients – and you all bought the same item for the same price!

Second, if you do actually end up making a sale, there is no guarantee that the Drop Shipping company will have that item in stock when you go to order it and they are not obligated to get the item back in stock just for your one customer, either. You and your customer can end up waiting 6 – 8 weeks or more!  In fact, it may end up that you are forced to refund the customer’s money just because the Drop Shipper oversold and didn’t have it in stock when YOU needed it.

The fact is that YOU as a PAID seller are obligated to ship the item to the customer within 30 days.  This is a hard and fast rule of Ebay AND of the FTC.  The fine point of this rule is that you've just been paid for the item (and let's face it, you're not going to ORDER it from the Drop Shipper until you ARE paid.)  Since you do not pay for a Drop Shipped item until it is shipped, the Drop shipping company is not tied to this same 30 day rule.  The FTC agrees with this, again by that fine point of received (or rather NOT received) payment.  When will the item come in?  Again the company is not required to get the item in stock for you or for your customer or for anyone for that matter. Even if they ARE going to order it again, they are not obligated to get it in quickly just for you.  

I’m not saying this WILL happen, but it does happen and more often than Drop Shippers will admit.