Shopify dropshipping is one of the easiest ways to sell products online without inventory. However, a big majority of budding entrepreneurs are often left confused if this form of selling products online is a legal or an illegal activity.
Is Drop Shipping Legal Or Is Dropshipping Illegal?
Is dropshipping legal? Well, this is a question asked by dropshipping newcomers on many forums and webinars. They often wonder how a business model that is all about selling the items that you don’t even own physically cannot be a fraud. If you are reading this post, there is a possibility that this thought of how you can possibly sell something that is in the ownership and possession of the manufacturer or the wholesale supplier can be sold by you even before you have paid for it.
Getting Products From My Online Store-Can I Legally Dropship From My Own Website?
Let us start with the basics before we can find out if it is actually legal to get a dedicated dropshipping store created and then start with processing orders and accepting payments on it.
To clear all doubts, let us first understand the concept of dropshipping to gain a clear and complete understanding.
Dropshipping can be best classified as a retail business model wherein you buy products from the supplier only when a demand for the same is received by you from a customer to your web store. In other words, you as the retailer never have to pay anything for inventory and warehousing as they are entirely handled by the dropshipping supplier. Moreover, you don’t have to even bother yourself with packaging and shipping of the products ordered by the customer as everything is handled by the drop shipping supplier.
Simply speaking, you get a web store created from BE BIGGY — the world’s most popular and preferred choice for turnkey dropshipping websites for sale. The teams of market researchers and product analysts at BE BIGGY preload your eCommerce store with many popular, bestselling, trending, and latest niche-specific products. These best products to sell on Shopify and similar eCommerce platforms like AliExpress and WooCommerce come from some of the most-reputed dropshipping suppliers across the world.
All this means that the visitors to your store get a huge variety of products on your store. However, you are required to promote your web store extensively, smartly, and efficiently on different marketing channels to bring website traffic and orders to your website-cum-eCommerce store. Since you are not accepting illegal payments here or dealing in illegal products or stealing anything from suppliers — there is no scope of this entire concept of dropshipping illegal.
Again, the process is SIMPLE AND LEGAL:
- You buy a web store from BE BIGGY legally.
- BE BIGGY delivers fully-automated eCommerce store to you legally.
- You start promoting your store ethically and legally.
- Customers start visiting your store and pay for products legally.
- You ask the supplier to ship products as ordered by the customers legally.
- The suppliers pack and ship the products to the customer on your behalf legally.
Everybody is happy and no illegality happened anywhere! No court in any country would call any of the above steps to buy and sell legal products illegal and that in itself is sufficient to say that DROPSHIPPING IS ABSOLUTELY LEGAL! Period!
Let us add more substance to these claims of legality surrounding the concept of dropshipping.
If dropshipping was illegal, why do some of the biggest names in the world of online shopping including Amazon and Etsy are dropshipping and why is nobody blocking them? If this form of business was illegal, it would have been really hard for anyone to find valuable information about dropshipping with just a simple search on Google? But is it? Obviously, no!
Global Dropshipping Legal Issues You Should Know About
Before we get started, it is important to tell our visitors that we are in no way authorized or a legal counsel to provide comprehensive and accurate advice to eCommerce entrepreneurs and businesses.
There may be no or a variety of dropshipping legal issues depending on the geographical location of your business. While some countries of the world innovate, promote, and facilitate eCommerce industry, there are some countries that in some way actually inhibit the growth of eCommerce business by imposing stern legal requirements. In short, legal issues in the context of dropshipping are more or less a territorial thing.
For eCommerce businesses based in the United States, the most common dropshipping legal requirements or issues include:
- Strict compliance with the Anti-spam law, especially with email marketing campaigns;
- Management of state and federal taxes;
- Registering an official trademark;
- Different states having different tax rates;
- Taxes also differ by the type of business — private limited, public limited, sole proprietor, partnership, etc.
Is It Illegal To Dropship On eBay?
Dropshipping is not at all illegal on eBay but it is also not a profitable activity to do so due to many factors.
PayPal holding the funds for eBay sales: PayPal is the preferred payment method used by eBay. Payments are held by PayPal whenever a product get sold till the time the buyer has received the product and satisfied with it.
Supplies going out of stock: If your supplier has gone out of stock with products for which you have pending orders, this may end up in you receiving negative reviews and noticing your credibility going down in the minds of buyers.
Stiff competition from supplier’s direct listings: The supplier that you are trusting for drop shipping orders may itself be already dropshipping on eBay. Obviously, this will result in price wars and therefore the profit margins for both parties will get killed due to these wars. No wonder, the supplier will win the battle because of economies of scale. Moreover, there is a possibility that your dropshipping supplier is also the dropship supplier to hundreds of other dropship retailers that significantly cuts down your profit margins.
Join the league of most profitable dropshipping companies by selling premium-quality most profitable dropshipping products. The world of legitimate dropship companies offers a wide range of profitable opportunities. Time to get into the right groove and start your journey to become one of the most successful Shopify stores! Get into the selling mode by buying a Shopify dropshipping ready-to-go-live and fully-automated marketplace website now!