The quick and easy answer to this question is NO.
DO I HAVE TO PAY FOR THE PRODUCTS BEFORE SELLING THEM?
The whole concept of drop shipping is based on allowing sellers to advertise the products on websites like eBay, Amazon, Bonanza or even from your own website, without having to buy the products up front.
Once you've made a sale then you pay for the item, meaning the wholesale price and shipping.
The difference between the amount you receive from your buyer and your wholesale cost is your profit. When you sell on eBay or from your own website, you get the payment immediately from your buyer when a sale is made. In most cases, people use Paypal to receive the payment and eBay is already integrated with Paypal so the payment process is very simple.
Then you can also use your Paypal account to pay for the wholesale order and the difference is left in your Paypal account as your profit. You can then transfer your Paypal balance directly to your bank account without any fees. This is done from your Paypal account.
There is an exception to this process when you sell on Amazon. With Amazon you you first need to pay for the wholesale order before you get the money from the buyer. The reason for this is because with Amazon, they collect the payment from the buyer instead of going straight to your Paypal account. Essentially you will still get your profit in the end, but you do need to have the ability to pay for your items after you made a sale, before getting your profit from Amazon. Again this is the case only with Amazon. If you wish to avoid a case like this, then you can sell on eBay or from your own website instead.