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When it comes to selling products, Facebook Marketplace (FBMP) is a highly profitable eCommerce trading platform. Also, in terms of the user base, it is one of the largest selling channels. According to Statista, Facebook Marketplace has over one billion active users as of 2021.
While there is a huge opportunity because of the existing user base, selling on Facebook Marketplace without proper knowledge can be confusing. That’s because there are Facebook Marketplace fees to cover and selling guidelines to follow.
That’s why in this article, we will go over how Facebook Marketplace works, its pros and cons, and the various fees we have to cover while dropshipping on the platform.
Before we start dropshipping on Facebook Marketplace, we need to know about Facebook Marketplace Fees. So, let’s look at the pricing structure of Facebook. In general, if you are selling as an individual, Facebook Marketplace does not charge any fees.
However, merchants or registered sellers on the platform have to pay two different fees: selling and chargeback fees. But, one of the most significant advantages of FBMP is that there are no listing fees.
Furthermore, selling fees are deducted automatically after we make each sale. As a selling charge, Facebook Marketplace charges 5% per shipment or a flat fee of $0.40 for products costing $8.00 or below.
So, here is how it looks in an actual transaction. If you sell a book worth $20, FBMP will deduct $1 as a selling fee. On the other hand, if you sell a book worth $6, FBMP will not deduct 5% of $6. Instead, we will have to pay a flat fee of $0.40.
Now, let’s look at chargeback fees. In some cases, buyers may file a chargeback, meaning they want their money back. When this occurs, FBMP holds the transaction amount or “chargeback fees” in a chargeback dispute until the issue is resolved.
Overall, Facebook Marketplace is relatively inexpensive when compared to other selling channels. As such, dropshipping on Facebook will help us scale our business faster.
Facebook Marketplace Fees:
Fees Cost
Subscription Cost No subscription fee
Listing Fee $0
Selling Fee 5% of the selling price or $0.40, whichever is higher
Chargeback Fee Only in the case of a customer request
Now, we know how much Facebook Marketplace charges as a selling fee. With that in mind, we should factor in the selling fees whenever we list a product to sell. In addition, we should also take shipping costs and profit margins into consideration. Only then will we be able to set a suitable selling price for our product.
However, instead of calculating the fees, profit margins, and selling price, it would be better if we could use a platform that automatically calculates it for us. Well, you’re in luck!.
AutoDS can automate our Facebook store product prices. To make our tasks more manageable, we can add our Facebook store to the AutoDS platform. Then, with the help of customized settings such as default price, break-even price, and profit margins, AutoDS lists products with optimal prices.
For instance, when we add a product to Facebook Marketplace, the final price factors in the selling fees and an additional 15% profit. Additionally, we can also change the settings according to different suppliers. For example, we can set a 20% profit margin instead of 15%, depending on the source price.
All in all, AutoDS helps us easily calculate all the fees associated with FBMP dropshipping. Therefore, we can easily determine our potential profits and set optimal product prices.
Now that we are aware of dropshipping costs on Facebook Marketplace, let’s look at their pros and cons. Like every selling channel, there are advantages and disadvantages of dropshipping on FBMP.
If you’ve been selling online, you may have come across many selling channels with hidden charges on top of other fees. But Facebook Marketplace is very transparent when it comes to fees. Simply put, we pay exactly what is stated on the platform.
Plus, FBMP has no subscription fees, which means we don’t have to pay upfront to use the platform. Therefore, we can start dropshipping on FBMP with zero investment.
Additionally, the buying and selling process is very simple on FBMP. If we are listing products to sell, all we need to do is upload its image, write a description, and set the selling price. If we want to add further information, we can add the product’s location, product category, and our shop policy.
On our buyer’s side, searching for products is also straightforward. They can search for products by applying different prices, locations, and category filters.
On top of that, FBMP has a massive number of active users. According to Mark Zuckerberg, CEO of Meta group, which owns FBMP, 800 million active users visit the platform monthly. With this vast user base, our stores can generate free organic traffic. Plus, we can expand our audience reach and gain even more sales.
Furthermore, dropshipping on FBMP is not expensive. As mentioned above, we only have to pay a 5% selling fee or a flat fee of $0.40, whichever is higher. Moreover, we only pay these fees after we sell products.
On the downside, FBMP only allows US citizens to dropship products in the United States. Therefore, the platform limits us from selling on Facebook if we are not US citizens. As such, if we reside outside of the US, then FBMP is not the best option for dropshipping.
Another drawback of FBMP is that the platform has no branding options for our stores. Thus, without branding, we miss a chance to differentiate ourselves from the competition. Nevertheless, we can still stand out and attain profits by offering trending products.
Moreover, with FBMP, we cannot store our buyer’s information. Instead, Facebook keeps our customer’s information for themselves. In essence, buyer’s information like email addresses is an essential resource we can use for marketing purposes.
However, the pros of FBMP outweigh the cons. Especially with extremely low selling fees, FBMP remains one of the best dropshipping selling channels we can use to scale our business.
Usually, selling channels come with costs such as subscriptions and selling fees. While they appear to be similar, there’s a slight difference between the two. Subscription fees are a recurring payment that selling channels charge users to sell on their platform.
These fees are typically paid in advance with either a monthly or yearly plan. For instance, selling channels like Wix, Shopify and eBay have a subscription fee that dropshippers must pay before selling on those channels.
On the other hand, selling fees are the charges the selling channel deducts from our sales. Unlike subscription fees, selling fees are only deducted after making a sale.
At this point, we have a clear understanding of how Facebook Marketplace works. Now let’s learn what steps we can take to increase our profits on FBMP.
With that said, the best and easiest way to do so is by automating our business operations. While dropshipping is a lucrative business model, we can perform dropshipping operations in two ways: manual and automatic.
Manual dropshipping is a slow way of handling business operations, such as importing products and fulfilling orders one at a time. Overall, manual dropshipping is tedious and time-consuming, especially after receiving multiple daily orders. After all, we cannot spend our valuable time selling just 2 or 3 products each day.
Conversely, automatic dropshipping is an intelligent way of dropshipping. With automatic dropshipping, we save considerable time and avoid human errors such as shipping to the wrong address.
With that in mind, one of the leading dropshipping tools in the market is AutoDS, an efficient dropshipping platform that saves us time, reduces errors, and enhances our business operations. Some features that make AutoDS an effective Facebook Marketplace dropshipping software are:
Every dropshipping business revolves around one thing. Good products! With that said, product research is the first and most crucial step of dropshipping. As such, AutoDS’ product research tool allows us to find in-demand products from our suppliers.
Then, we can add them to our stores with a product importing tool. The product importing tool enables us to import tens of thousands of products from our suppliers in a few clicks.
Next, the AutoDS order fulfillment feature automatically fulfills our customer’s orders using our buyer accounts on the supplier’s website. Moreover, Fulfilled by AutoDS is a more advanced form of order fulfillment that doesn’t use our buyer accounts. Instead, it uses our balance (AutoCredits) to fulfill orders. This way, our accounts won’t get locked, and we can continue dropshipping easily.
Another way to automate our business is with automatic price optimization. As store owners, some of our products will sell exceptionally well while others will not. In that case, the AutoDS price optimization tool sets an optimal price for each product according to its sales.
For example, the software automatically increases the product’s price if it’s selling well. Conversely, if the product is not selling well, the software decreases the price to sell it faster.
Overall, with these brilliant characteristics, the AutoDS dropshipping tool enables us to process and manage more customer orders. Ultimately, it helps us to scale our business efficiently.
Yes, Facebook Marketplace charges us a selling fee. However, the platform has no subscription costs and is free to use.
Facebook charges us a selling fee of 5% of the price or a flat fee of $0.40 for products under $8.
No, Facebook Marketplace fees are not expensive. In fact, the costs are very affordable since we only have to pay after we make a sale.
Yes, you can absolutely dropship on Facebook Marketplace. However, FBMP has a set of legal specifications we must follow. Nonetheless, dropshipping on FBMP can bring us great profits and long-term success.
Yes, fortunately, there is a Facebook Marketplace Dropshipping Case Study you can learn from. Here, we can gain comprehensive knowledge about dropshipping on Facebook Marketplace.
Yes, without a doubt! Dropshipping on Facebook Marketplace is worth it, especially for beginners, due to the free organic traffic and low seller competition.
Fantastic! Now, you are equipped with all the necessary information about Facebook Marketplace fees. Thanks to its competitive selling fees, we can start dropshipping on Facebook and earn significant profits.
As FBMP continues to gain popularity, we should take advantage of this relatively new platform as soon as possible. And with low competition, selling on Facebook Marketplace will be a walk in the park, especially with AutoDS’ automation tools.
All in all now is the best time to sell on Facebook Marketplace. So, if you want to be an expert in Facebook Marketplace dropshipping, here are some articles to help you along the way:
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