$500 a Day w/ No Inventory

Smart side hustlers go where the cash is already flowing…

One place it’s been flowing at a rapidly increasing pace is Facebook Marketplace.

What started as a Craigslist competitor — a place to buy and sell secondhand stuff — has morphed into an e-commerce powerhouse in its own right.

How Facebook Marketplace works will not be new to most reading this. But how today’s guest, Andrey Kozlov is taking advantage of this platform will be a real eye-opener to most.

So, how can you take advantage?

In this episode, you’ll learn how Andrey Kozlov is making hundreds of dollars a day, selling stuff on Facebook he never even has to touch.

Tune in to The Side Hustle Show interview to learn:

  • how dropshipping on Facebook marketplace works
  • how to find profitable products and make your listings stand out
  • the risks and pitfalls to avoid

Table of Contents

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How to Do Product Research for Facebook Marketplace

If you open up Facebook Marketplace on your mobile and go to the home section you’ll see “Today’s picks”.

This is the section most people are familiar with, and this is where you see the latest items for sale.

However, Andrey said that if you scroll down a little, you’ll see a section called “Items people are buying”.

This is where Andrey does his research. Or more accurately, Facebook does most of the research for him by listing best-selling items.

Andrey uses this information to find out what the most popular products are that people are buying. He then looks into which products he can bring to the market that are selling well.

Since neither my version of Facebook on desktop nor the Facebook app had that section, Andrey recommended eBay’s Terapeak product research tool. This tool is instrumental in his business, it helps Andrey see additional sales information, connects him with potential suppliers, and more.

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These are the core methods Andrey uses to do his product research, and the best part is that it’s completely free.

How to Spot Dropshippers Selling on Facebook Marketplace

If you want to identify some sellers dropshipping on a Facebook Marketplace, Andrey said some of the signs to look out for are:

  • Professional-looking photographs of their products
  • A large number of reviews and/or items sold recently
  • Offering products in bulk
  • Seller is selling items across multiple categories

This can be a good way to take a look at what other dropshippers are selling if you’re sizing up the competition or looking for products to sell.

How to Find Products to Dropship

There are a seemingly endless number of items being sold on Facebook Marketplaces and it can feel daunting figuring out what you want to sell.

“I suggest to keep it relatively simple,” was Andrey’s advice.

Andrey explained he typically starts by typing in a general category or product into Terapeak. “Christmas trees” was an example Andrey gave, which is obviously a seasonal example.

He sorts the results by the highest number of sales in the last 7 days and looks at what products are selling well.

For this search, he could see different Christmas trees, lights, and other Christmas-related products.

example of terapeak data

“We usually just relist the items with the most amount of sales, it’s as easy as that,” Andrey told me.

Competitive Analysis

When you find an item using Terapeak that you want to sell, Andrey said the first thing you should do is search that item in Facebook Marketplace to see what comes up.

fb marketplace search results

This will give you an idea of how many sellers—if any—are already selling this exact item. You may also be able to see how many sales they’re making, and how much they’re selling the item for.

That’s the extent of Andrey’s competitive analysis. Because you’re not ordering and holding stock, you don’t need to be concerned about a product not selling when you’re starting out.

How to Create a Drop Shipping Listing to Stand Out From the Crowd

“We tap into those products. We make those listings, we make better pictures, we adjust the pricing a little bit, and really put the effort into the listing creation,” Andrey told me about his process.

Here’s how Audrey creates his listings to stand out from the other sellers:

Images

Andrey will use images of the products from the seller sometimes. But he prefers to “borrow” images customers who have reviewed products have posted on Amazon.

He does this because he wants to find lifestyle images that show the products being used, and says this is what helps his listings stand out.

Andrey said he’s run tests, and lifestyle images perform better than the stock-style images with white backgrounds he gets from suppliers.

Descriptions

Don’t just copy and paste. Andrey said most of the descriptions he sees are written by Chinese sellers and have grammar mistakes, or just aren’t great.

Write a good description for the product that lists all the features and specifications.

Andrey said he also includes a “Package includes” section, which is important as it clearly lays out what the buyer can expect in the box.

Price / Margin

Andrey said as a general rule, he aims for at least $5 profit for “low ticket items.” For items that cost at least $60, he’s looking to add $10-15 to the cost price. For items that cost $150+, Andrey said he aims for a $20-30 markup.

Andrey doesn’t have any set % markups; it really depends on the individual item.

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One of his more profitable items, for example, was a beehive for beekeepers. He bought them for $225 from eBay and sold them for $375 shipped.

Andrey also recommends selling items at a lower price point than competitors and shifting some of that profit into the shipping costs.

He does this because he said the Facebook algorithm favors items that are priced lower and doesn’t take into account the shipping cost.

It’s also important to bake Facebook’s 5% seller’s fee into your margin. It’s possible to sell items with no fees if you set up a storefront and operate as a business, but that’s due to change in June 2022.

For new sellers, Andrey recommends sticking to items costing $30 or less until you get a feel for the process.

Supplying the Items and Getting Paid

For those new to selling on Facebook Marketplace, it’s important for cash flow purposes to know that you don’t get paid the moment you sell an item.

To get paid, you need to mark the item as shipped and supply a valid tracking number to prove the item has been shipped out.

It then takes 5 days for the money to be paid to you from the date of delivery. Keep this in mind, especially when starting out as it can cause cash flow problems.

In terms of supplying items, when you receive an order through Facebook Marketplace, you treat the process like you’re ordering an item for a friend.

Wherever you sourced the item, such as eBay or Amazon, you make a purchase and send it directly to the customer.

What Are the Biggest Risks of Dropshipping on Facebook Marketplace?

Out of the thousands of orders Andrey has shipped, he’s had a couple of customers question why their items have been shipped from Amazon or eBay.

Andrey has also had and a couple of customers queried the price when they’ve clocked that they could have bought the item cheaper themselves if they went direct.

He said he doesn’t make a fuss if people realize he’s dropshipping. He’s always happy to refund them as it comes up so rarely.

A more common problem is running into supply issues. There is always a risk that a supplier will run out of stock while you have listings up on Facebook.

To avoid supply issues, Andrey recommends using SKU Grid. This tool monitors your suppliers’ inventory and sends you email alerts if they’re running low.

There is also the omnipresent risk of having your Facebook account banned. This can happen at any time, and without explanation from Facebook.

Andrey has had his account banned at least four times, although he has had it reinstated by appealing each time.

Andrey recommends having backup accounts parked, just in case you end up getting your account banned for any reason.

How Do You Handle Returns?

If a customer wants to return an item for any reason, this is something that will have to go through you as you purchased the item.

Andrey said he only deals with Amazon, eBay, and Walmart, and they all have straightforward returns procedures.

In most cases, after a customer contacts Andrey to ask how to return the item, Andrey requests a return label from the supplier.

Andrey then sends the label to the customer, and they return the item to the supplier. They will either receive a replacement item, or Andrey will receive a refund and then pass that refund onto the customer.

A Typical Day’s Order Volume

At the time of the interview, Andrey was averaging 70-110 orders per day and having marked up several products as out of stock.

This was around Black Friday, so demand was higher than usual. Facebook was also offering some discounts on shipping and running some other promotions.

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To give you a better idea of what kind of profit margins you can expect, Andrey shared his numbers for the previous 3 months:

  • August – Revenue was $66,000 with a profit of $16,000. That’s a profit margin of ~25%.
  • September – Revenue was $70,000 with a profit of $16,000. That’s a profit margin of ~23%.
  • October – Revenue was $89,000 with a profit of $22,000. That’s a profit margin of ~25%.

Using Facebook’s Commerce Manager

Facebook offers a “Commerce Manager” platform. This is essentially setting yourself up as a business instead of an individual seller.

It enables you to sell items under your store name, and also gives you some additional tools and resources to manage your catalog of products.

Andrey recommends setting yourself up as a Commerce Manager if you want to scale up. He also said he’s noticed the Facebook algorithm favoring Commerce stores and said he gets more organic traffic as a store.

Do You Need to Run Paid Ads?

Andrey doesn’t use Facebook ads to drive traffic to his listings.

If you price your items right, you shouldn’t need to promote them, he explained. Andrey said there is enough organic traffic on Facebook to go around.

Handling the Logistics and Hiring Virtual Assistants

Andrey used to handle everything himself in the beginning, but as he approached the 100 orders a day mark it became too much to handle alone.

He now has a team of 6 virtual assistants helping out with the day-to-day running of the business.

Hiring VAs is something Andrey recommends to anyone looking to scale up their dropshipping business before the workload becomes overwhelming.

What’s Next?

“2022 will be my year of diversification,” Andrey told me.

Andrey is planning on expanding into Amazon FBA and wholesale dropshipping with some of his own products.

He also wants to try out some other business projects like an Airbnb business, some crypto and stocks, and some other things.

All of this has been made possible by his success selling on Facebook Marketplace, and he’s excited for the future.

Andrey’s #1 Tip for Side Hustle Nation

Take action.”

Free Bonus: 25 Drop Shipping Niche Ideas

25 Drop Shipping Niche Ideas

Find profitable products with these categories.

Enter your email to grab the free resource now:

You’ll also receive my best side hustle tips and weekly-ish newsletter. Opt-out anytime.

Links and Resources from this Episode

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Here’s a quick behind-the-scenes video of the marketplace. (You may have to request to join the Side Hustle Nation FB group to see it.)

Now in partnership with Niche Website Builders, you can easily add on a done-for-you content package from a trusted provider.

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