Why use DropShipping?
In today’s world, many people try to operate a profitable business by using the internet. It is much simpler to have a virtual storefront than to have a brick and mortar store. In addition, it is much cheaper to operate. One of the major reasons that the cost of operation is minimal is due to the process known as drop shipping.
Dropshipping seems to be a magical way of getting merchandise, selling the merchandise, delivering the merchandise, while not visibly seeing the merchandise. This may sound a bit complicated but actually, it is very simple. To use an example let us use the Dutch Maid Manufacturer of cleansers. Dutch Maid makes a lot of product but they are not in the business to sell or distribute the product. The next group let us introduce is Mr. Distributor who is the person who goes to the Dutch Maid Manufacturer and contracts to buy the product by the case at a dollar a can or $12 a case. The Manufacturer declares that it cost him .50cents a can to make, so there is a $6 a case profit. The Manufacturer is happy because he has profited without having to try to sell or advertise which has greatly saved on the company’s profit margin.
Let us take this a step forward, as Mr. Distributor now needs to sell the product in one of two ways, which is by soliciting retail stores and having them agree to buy the product or by opening up a website where Mr. Distributor can take orders and sell online. In both cases, the process of drop shipping plays a vital part in Mr. Distributor’s business. First Mr. Distributor now has a good product for resale but does not have to keep it stored nor does he have to open up a storefront to display the product. He is using the drop shipping method simply put the retail store’s order from him and he sends the order to the Dutch Maid Manufacturer who sends the product to the customer. This is why the use of dropshipping is the best way to run a business without too much investment.
This sounds like a sure-fire way to make money without losing a truly profit-making opportunity. Unfortunately, success stories are rare as those who venture into this line of business balk under the adverse and challenging realities of the competitive medium.
The primary reason for these unfortunate cases is not in the business plan or the lack of commitment on the part of those behind the idea, but rather it is inadequate and unreliable information. Most entrepreneurs fail because they did not locate genuine and legitimate wholesale and dropshipping companies.
The other reason being the drop shippers is not supplying the kind of niche goods that actually generate not only a high number of sales but extremely high profits as well. The use of a good drop shipper is one of the most vital aspects of a distributor’s business.
How much does Drop shipping cost
The cost of Dropshipping is determined by the Dropshipper. It is very important for you to know the cost of Dropshipping before you start Dropshipping.
You need to thoroughly research and look for companies that offer Dropshipping service. Some wholesale companies as you no doubt know will not drop-ship for you. There are others who will drop ship for an additional fee. It will enhance your bottom-line if you find a company that’ll drop ship at no cost other than shipping and the cost of the merchandise. Some companies will charge a small membership fee at the beginning nevertheless this membership fee will be given back to you after you have made a certain number of purchases.
If you sign up with a company that charges a monthly fee you could end up giving away your profit for a month or two. You need to know all the cost of Dropshipping so you can accurately calculate your profit. Be sure you get an itemized list of expenses from your Dropshipper. You need to know the cost of the item, the charge for shipping, and taxes if any. Be reminded that some states charged an additional tax on purchases. If you are paying a monthly fee to a Dropshipper you have to also prorate that fee into the total cost.
Remember there are always scams lurking to take advantage of beginners and others in any situation. You can always check with the Better Business Bureau to see if there have been complaints about the business dealings of any one of the Dropshippers you find. Check with your Dropshipper also to see how your account will be calculated. It is important to know whether you will be charged piece by piece or whether you will be charged on a monthly time table. Find out if the company accepts returns or what the return policy is.
If the company does not accept returns, then you may have to factor into your records a loss for that month. So that you will be able to adequately determine the cost for Dropshipping, get all this information in writing before you start working with a company. Drop shipping can be a very efficient way to start a business it can enhance the bottom-line of any business but you need to know all the facts up front before you start. Even more so you need to let your customers know the return policy because eventually this can define your bottom-line.
Don’t forget to get the company’s policy for damage merchandise. Some companies will accept returns on damage merchandise and some companies will not accept returns on damage merchandise. Wholesalers that dropship sometimes are reluctant to accept merchandise that has been opened and damage. So make sure you get in writing the policy the company will adhere to for damage merchandise that has been opened. Damage merchandise that the company will not accept as a return will be part of your Dropshipping cost on the bottom.
Why use the DropShip method?
The best answer to that is money, time, and success. Yes, the dropshipping method saves the retailer lots of money.
- The seller saves by not having to pay for a storage space.
- The seller saves by not having to have a bulk of product on hand that is not selling.
- The seller saves because he no longer has the expense of packaging and shipping the product.
- The seller saves money by not having a large payroll. The seller does not need a staff the drop ship method takes care of that.
The retailer saves valuable time so that he can do things that are more important.
- The retailer does not have to do the research work to find products and shippers in order to meet quota.
- The retailer saves time by not having to package and ship the product.
- The retailer saves time by not having to drive to work and back home again.
- The retailer actually saves money and time by having a virtual storefront.
The dropship method has helped many people to have a very good income without having to make large investment cash, store products, and finding the right products for sales. The use of a drop shipper is truly necessary for this kind of business.
The dropship method is so simple that anyone can do it if with the desire and the proper information. It is not complicated and most companies provide advisors to help you so that when you first start up you will know what to do to expect. Many companies have their own sites and offer a forum so they can speak one to another and get ideas. Online advisors can also help to solve any problem you might be having. It is not easy to get free advice when you are in business. It is easy to get fraudulent information losing a lot of money and not ever seeing any returns. That is why the drop ship method is so popular it helps resolve many issues in an honest manner.
The Amazon Directory offers you a connection to over 9000 suppliers and over three million products. The company also does the Import wholesale supplier business so that is something you do not need to worry about but you can benefit from the wholesale products. The “HOT” products to sell online are provided for your benefit so that you can decide to sell them or not.
The best things are that you are informed about with Amazon what is selling now and how it is going. As we, all know Amazon is one of the leading online companies people use to sell and buy products. The company offers auctions, classified sales, and a storefront that you can use and well known by everyone worldwide. Many people do sell on Amazon and many people go to Amazon to buy a product. The ease of using Amazon has caused many people to quit the mainstream of work and stay at home working from their home office.