When you start dropshipping on eBay there are a few things you need:

  1. An eBay seller account

  2. A processing payment provider, like PayPal or eBay managed payments

  3. A dropshipping software like DSM Tool

In this article, you will learn how to set up an eBay seller account and how to set up a PayPal account or sign up for the eBay managed payments service.

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How To Set Up an eBay Seller Account

On eBay, you can use the same account for buying and selling. The process is very simple and intuitive, follow it step by step.

Step 1: Register to eBay

Go to ebay.com or to the local eBay website you plan to sell to and click on the Register button at the top left corner

Fill out the form, including contact information, email address, password, first and last name, and your mobile phone number.

In case you own a registered business, choose to option to register as a business account.

What is the difference between personal and business account on eBay

The main difference between personal and business accounts is that when you register with a business eBay invoices your business name which corresponds with your tax reports.

If you register a business in the future, you can change the account type from personal to business in the eBay account settings under the section Personal Information.

After you register you will be offered to further secure the account by linking a phone number to it. It is recommended to do that already now

You have registered succesfuly

Step 2: Create a Seller Account

At the top right section on eBay Click β€œSell”.

Fill up your address

When you reach the selling page where you can specify which product you wish to sell on eBay, you will be one step away from completing the seller's account.

The last step that completes the creation of the eBay seller account is the setup of a payment method that will be used to pay the selling fee.

Step 3: Setup payment method

When you sell a product on eBay, you are being invoiced with the selling fee (typically 10% unless you upgrade to an eBay store subscription).

The invoice is paid every 15th of the month and it is recommended to connect your PayPal account to your eBay store as a payment method. After all, you get paid via PayPal and it makes sense to use that balance to pay your selling feed.

If you don't yet have a PayPal account, skip this step and read the next part of this article on how to set up a PayPal account.

When you are done setting up the PayPal account, go to the account at the top left corner of the eBay website

Go to Payments -> PayPal account

Click on Link My PayPal Account

Follow the instructions and complete linking the accounts. Once your PayPal account is linked to your eBay account you can start selling on eBay.

How To Set a PayPal Account

When you start selling on eBay there are two ways for you to get paid when you sell a product:

  1. Sign up to PayPal and connect it as a payment processor to your eBay store

  2. Use the eBay managed payment service

Later in this article, you can find information about how to roll into the eBay managed payment service. Since eBay managed payment is relatively new, it is not yet available to all sellers in all countries, therefore you might still choose to accept payments via PayPal.

To set up PayPal for dropshipping follow these 4 simple steps:

Step 1: Sign Up To PayPal

Go to PayPal and click on Sign Up

Choose a business account, these are accounts meant for accepting payments and selling online.

If you already have a personal account you can change it to a business account. Go to the profile settings at the top right corner when you are logged in to your PayPal account and change it under the Account Type option

Like on eBay, you will be asked to fill up your email, choose a password, and fill up some personal details. The questions you will be asked vary depending on which country you register from. Here are some common answers to questions that might come up:

  1. Business name - If you are a registered business enter your legal entity name, otherwise enter your full name or the name you plan to register the business under in the future

  2. Product or service - choose "variety stores"

  3. Monthly sales - Choose "$50-$99K"

  4. Website - Leave blank

Tip: Attain a debit card from Paypal - The PayPal debit card isn't available in every country.

In case it is available for you, it is a great way to avoid the hustle of transferring money from the PayPal account to your bank account and then paying on Ali Express (or whatever website you are sourcing from) using your debit/credit card, consider getting it.

Finish the signup process and move to the account verification process, verifying your PayPal account is an important step that will help you start your business smoothly, do it as early as possible.

Step 2: Verify Your Paypal Account

The PayPal account verification has two steps: email verification and card/bank linking.

Verify your email address

Log in to the email you signed up to PayPal with and locate the verification email, enter the email and click Confirm my email address

You will be taken back to PayPal where you will be asked to enter your email and password, then your email address will get verified.

Link Card/Bank

In the account settings go to Wallet, depending on the country you are from, it might appear in the menu as Money

According to your preference, choose to link a card or a bank to your account. The linking process takes a day or two in which PayPal charges and refunds you a few cents.

Follow the instructions on PayPal to complete the process

Step 3: Withdraw Money To Pay Your Dropshipping Suppliers

When you sell on eBay you get paid directly to your PayPal account. If you are sourcing your products from websites that do not accept PayPal as a payment method you will need to withdraw money from your PayPal balance to your card or bank account.

In your PayPal dashboard click on Transfer Payment and choose the bank account or card you linked to your PayPal account in the verification process, the transfer can take 2-5 business days but typically does not take longer than 3 days.

When to withdraw to a card and when to a bank account

If you are located at the same local market as your PayPal and eBay account (for example: if you sell on eBay.com, own a US PayPal account and US bank account) it is probably easier to withdraw the money directly to your bank account and use a credit or debit card to pay on Ali Express or any website you source products from

If you are an international seller check with PayPal customer support if withdrawing the currency you get paid with (for example USD for eBay.com sellers) directly to your bank account will result in automatic currency exchange.

For example: PayPal does not transfer USD directly to Israeli banks, instead it first converts is to the local Israeli currently (ILS) and then transfers the money in local currency.

It is recommended to avoid transferring money directly to your bank when automatic exchange because when you pay your suppliers you typically pay in USD or the currency you sell in, and that would result in paying double exchange fees for every sale - once for the transfer from PayPal to your bank and once to exchange the money in the bank to pay in USD on Ali Express.

If an automatic exchange is applied to your bank withdraws, contact your bank account to issue a credit card with a USD balance. Then, add the credit card to your PayPal account and withdraw the money directly to it.

Step 4: Connect The PayPal Account to eBay

The last step of the PayPal account setup is connecting it to eBay, without the connection when you sell on eBay the funds won't be able to transfer to your PayPal account.

Go to eBay > Top left dropdown menu > Payments > PayPal Account

Click Link my PayPal account

You will be redirected to PayPal and be asked to log in. Then, when the account linking will be done successfully you will be redirected back to eBay.

How To Setup eBay Managed Payments

The eBay managed payments feature is not available for all of the sellers on eBay. At the moment a full guide on how to set up the service is not available in this help center but you can get help from eBay with its setup if you follow these steps:

  1. Opt-in to the eBay seller hub

  2. Go to the Payments tab

  3. Click Express Interest

Tip: Learn more about this new payment system in the eBay managed payments quick guide

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