Drop Shipping Sucks - and will never work on eBay! Download

My name is Chris Bernard. I worked for 11 years in the wholesale & drop ship industries and was considered one of the leading industry experts. During that time I worked with many of the world’s most prominent drop ship companies. However, in February 2007 I was abruptly blacklisted from the industry just for speaking the truth! The truth that would cut into the drop shipping gold-rush profits and would demand the industry reinvent itself…

To really understand the problem with drop shipping, you need to understand its origin.


Before the internet, companies that had products to sell but didn’t have retail (brick-and-mortar) stores would sell their products through catalogs and door-to-door sales. So, they needed a sales force to go out and actively find buyers. These types of sales teams are often referred to as "feet-on-the-street". Literally people to walk around and sell products.

Drop shipping allowed companies to have people selling their products by distributing their catalogs, knocking on doors, and recommending their products to friends, family, and neighbors… Without the overhead costs of traditional employees.

With drop shipping, companies wouldn’t have to provide benefits such as insurance, retirement plans, etc. and companies would only pay out per-sale (commissions). This was ideal because a company would never have to pay for a salesman who wasn’t producing results and could grow a huge sales force without any financial risk.

Companies like this still exist today. Mary Kay, Kirby, PartyLite, Lia Sophia, etc are all examples of drop ship companies that still run the "old-school" model of business. Catalog & door-to-door sales driven by real people.

But the key element to drop shipping was, and still is, a secured market. The companies above sell products exclusively through personal sales reps and do not sell in retail outlets, to wholesalers, to the public. This is what makes them work. The prices, distribution channels, and markets are all tightly controlled.

This is not true with the drop shipping companies that litter the internet with claims of huge profits selling popular items such as iPods, laptop computers, jewelry, etc. Any product that is not controlled by the manufacturer and sold exclusively through personal sales reps (AKA. drop ship sales) will not be profitable online. Why?…

Resale (buying and re-selling for a profit) is all about buying power. And with drop shipping, you have none. Zero. You are often buying just one of an item, and thus, have no buying power. Because true wholesale pricing is all about quantity.

A huge established retailer, like Wal-Mart for example, has extraordinary buying power. They don’t just buy one iPod at a time, they contract to buy thousands. Let’s look at the numbers using a gold necklace as an example…

Let’s say a wholesaler’s cost on a gold necklace is $10 and the wholesaler sells the necklace to a famous department store for $11.50 each (cost +$1.50) with a quantity of 10,000 pieces. The wholesaler will profit around $15,000 on this sale.

If you want just one necklace for $11.50, the wholesaler will profit less than $2.00 and have to breakup a case of merchandise. No serious company is going to make this sale. Not even a drop shipper.

Would you bother selling items and doing a bunch of work for $1.50? Well, neither will any other company — and it’s not fair to expect that of them.

That is why drop shipping is not true wholesale. With drop shipping you can buy just one necklace. But you can expect to pay at least 25% more for the product. That would make the price $14.75 each in our necklace example.

But we’re just getting started… On top of the product sale price, there is almost always a handling fee associated with drop shipping. This is usually $2 – $3 per item, brining your cost on the necklace to a base price of $16.75 or more.

This is why many people using drop shipping services end up complaining that they can find the product for less money retail. After all, in the example just given the retailer could sell the necklace for $15 and still profit.

Remember, the old-school drop shipping companies (such as Mary Kay) mentioned above do not sell to Wal-Mart or other retailers. They only sell through reps and, in general, all reps get the same base price. So in those cases you can get the lowest price and can potentially compete.

So are you beginning to understand why you cannot find a quality, low-price drop shipper of name brand merchandise?

There is more working against you than just buying power unfortunately. The sad truth is that even if you could find a drop shipper who would sell you one gold necklace at a time for $11.50 you still wouldn’t be able to sustain a successful online business due to reason number two…

Market value determines the price at which you can successfully sell a product. Market value is not a constant; it is an ever changing variable which can be influenced by supply-and-demand, competition, technology costs, and other factors. The market value of a product is almost always changing. For a simple example of this, look at the DVD player.

An original DVD player, when they first hit the market, sold for more than $600. These days, a much better DVD player costs under $60 — or less than 10% of the original retail price.

While it took the DVD player a few years to drop so dramatically in price, it can take as little as a few days for the market value of a product to plummet in the online marketplace. Especially when dealing with online auction sites such as eBay.

To understand this process, let’s look at the gold necklace again and assume you were able to get the product drop shipped for the $11.50 price. That…

Drop Shipping Sucks - and will never work on eBay!

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[GET] American Business Launch

It’s no secret America is one of the largest and most wealthy marketplaces in the world. It just makes sense to take your business where the buyers are. We all know the first three rules of business are: Location, Location, and Location.

It might surprise you to know an online business in America operates for a fraction of what the same business could cost you in your own country.


The reality is it’s very difficult to find reliable information about setting up an American business when you don’t live in America.

FitnessLyceum – an online store retailing fitness equipment in the United States but set up and run by Robert Mangan, a non-U.S. resident living ‘down under’.

Setting up a business is hard work. But setting up a business in America when you don’t even live there, are not a resident or a citizen, and when you live half way around the world, is nearly impossible.

Sometimes I felt like I was alone, paddling upstream, in rapids infested with sharks. I wondered if establishing a business in another country truly was something best left to fancy corporations with their expensive lawyers.

So I spent several months searching Google, just hoping to figure out a way to get my business started. The information I wanted simply wasn’t to be found, or worse still, the information I did find was often just plain wrong!

More than once I fell prey to those online scam artists who make their fortunes from folks like you and me who are just trying to earn an honest living online. I consider myself fairly savvy, but they promised easy solutions to the exact problems I faced trying to setup my business.

They say experience is the best teacher, but I’m not sure that’s true. If there had been someone to guide me through the entire process, walking ahead and warning me of potential dangers, I think I could have learned just as much.

Online entrepreneurship can be lonely, but what if you could talk to someone who has already been there and succeeded? That is why I decided to write this book.

Through trial and error (sometimes more error than anything), I’ve blazed a trail for anyone who wants to base their online business in the United States. Why shouldn’t everyone be allowed to benefit from my blood, sweat, and tears?

I’ll share personal experiences with you. I’ll reveal the paradigm shift that made everything work for me, and why it will work for you too

How to open a U.S. bank account so you will avoid the outrageous exchange rates and check cashing fees charged by all banks

How to obtain a U.S. merchant account so you will get the lowest transaction fees and are able to compete with large American companies

How to find products, retail them online, provide excellent customer care, and manage all this from a small corner of your home, even if you don’t have room to store (or the funds to purchase) anything you want to sell

When you download your copy of this 125-page ebook, you also get my email address so you can get further help from me if you need it.

Take advantage of U.S. tax laws for non-U.S. residents and cut down on exchange rates and other fees*

Offer your physical and dropship products, eBooks, software, and services to the World’s largest market and put more cash in your pocket

Get a U.S. personal bank account off the back of your U.S. company and do even more business in the U.S.

I’ll show you the tactics I discovered that help me win the battle against really big boys like Amazon and Walmart.

And although there are companies who would love to make a ton of money selling you dropshipping lists, I’ll show you how to use dropshipping to your advantage, without crossing over to the dropshipping dark side.

*Always consult an accountant about the tax you’re are liable to pay, whether you run a business in your own country or from the U.S.

I didn’t want to add another get rich quick scheme to the plethora of “helpful” guides already cluttering the web, or another book of “secrets the experts don’t want you to know (but you could easily find on Google). This ebook isn’t a “blue print,” or an “automated process you can run wearing your pajamas and bunny slippers” (I wouldn’t rule out the pajamas and the bunny slippers, but you are going to have to work).

When you order this book, what you’ll get is a candid 125-page report of what I did right, what I did wrong, and what I would do differently next time, all of it based on my own personal, real-life experience setting up a U.S. based online store from a small corner of my home in Melbourne, Australia.

My U.S. based online store was my first business ever. I possess no extraordinary talents or intelligence. If I was able to succeed, then, believe me, anyone who follows these step by step instructions can succeed as well.

So if you’ve ever thought about starting your own online business, or even if you already have an online business and want to take advantage of the tax benefits, lower overheads, have exchange rate conversions work in your favor, or to just look more credible to your U.S. suppliers and customers this book will show you how.

I started talking to Robert before this book had been written and I was one of the people that initially encouraged him to write the book. I was toying with the idea of drop shipping in the U.S. but really had no idea how to go about it, what was needed and what I should expect. Before the book…

American Business Launch