Posted on by ROISEM

 

Exploring the Drop ship Option:

When you start choosing products to sell, you eventually need to narrow your selections to products that you can buy, sell, and ship easily and profitably. If you don’t have the funds or desire to order products directly from manufacturers and store them in your house, a popular option is to use a drop shipper.

Drop shipping allows all you to list products, take orders, and pass those purchases to the drop shipper.  The drop shipper packages the item and ships it directly to the customer who ordered it. The customer thinks the product came from the store and usually doesn’t realize that a drop shipper was involved. Drop shipping offers several advantages over the traditional wholesale models including the following:

  • Low-risk: You pay for a product only after you sell the product so you risk only what you have tied up in the listing the product for sale.
  • No inventory cost or clutter: You never touch the product so you don’t have to pay for storage or have products in your garage or basement.
  • No packaging or shipping process: You outsourced your warehouse and shipping departments to the drop shipper. Most drop shippers also process returns.
  • Wider selection: As an online retailer, as opposed to a brick-and-mortar establishment, you have unlimited shelf space. You can offer a wider selection of products. You can sell products of any size or weight.
  • Easy product testing: If you’re not sure whether a product will sell, you can try to sell it first, without having any stock. Then, if you get an order and gain confidence in a product, you can order it in bulk and shift to an inventory strategy, if you decide that is cheaper.

You can pursue a drop ship strategy in two ways:

Deal directly with individual drop shippers who carry a limited product line or with a drop ship aggregator who has established relationship with numerous drop shippers. When you’re getting started you’re probably better off drop ship aggregator, because aggregate offer the following benefits.

  • Wider product selection: You typically have a catalog of more than 1 million products from over 100 drop shippers.
  • Simplicity: You have one drop ship aggregator to deal with, instead of having to manage separate accounts with numerous drop shippers, each of which has a different way of doing business and listing products.
  • Lower-cost: A drop ship aggregator often has more leverage than a mom-and-pop retailer when negotiating prices with individual drop shippers. This more than offsets what the aggregate of charges.

Here are a few of the more popular and well-established drop ship aggregators:

Once you find a drop shipper that’s right for you, dig into their website/catalog to decide exactly which products you want to sell, considering what will appeal to your target market, how it fits in with your desired brand, and how your product mix will impact your bottom line.