Drop Shipping 101

Drop Shipping 101

Wednesday, March 9, 2016Kelly Nelson Drop shipping is quickly becoming a common term among eCommerce professionals. It has become a very popular method of supply chain management for start-ups as well as more established retailers. For those of you who need a bit more information to be convinced one way or another, we have outlined a number of the basics below.

What is Drop Shipping?

Drop shipping is a common fulfillment method used by eCommerce business owners. It allows an online retailer to purchase products individually from a wholesaler and have them shipped directly to the customer. With this, the retailer’s only job is to find a drop shipping supplier to partner with.

So how do you know if it’s the option right for you?

Advantages and Disadvantages of Drop Shipping

Previously we have written on this and you can find it here. To summarize, here is a summary:
 
Advantages Disadvantages
Reduces your risk Order processing can be a mess
It is extremely scalable There is an increase in competition
Lower investment up front Low profit margin
Less hassle overall  

What can you Drop Ship?

Just about anything! From consumer goods to foods, you can dropship many different types of products. This is definitely one of the main advantages of this method.

How to find a Drop Shipper

There are a few methods in finding a quality drop shipper you can try.
  • Do a quick search online. We all know the power of a good Google search! Here’s the problem though, typically they do not have quality websites with good SEO and can be hard to find. Remember to go past the first page of options and be thorough with your search. You may also want to try expanding your search to use other optimized words (ie. Wholesaler, reseller, supplier, etc).
  • Find a paid directory to conduct your search. As we mentioned above, drop shippers can be hard to find. As a result, paid directories have been developed to make the search a bit easier. Even still though, it is important to keep in mind that not all links provided will be up to date, valid or even legitimate.

Drop Shipper Check List

When looking for a drop shipping, it is very important to look for certain qualities and criteria. Here is a list of questions you should be asking:
  • Do you have references of other companies they have worked with?
  • Do you have international customers? If so find out if they can ship internationally for you
  • How do they accept payment?
  • How long have they been in operation?
  • Do they have a good rating?

Bringing it all together

As we’ve always said, drop shipping is a method for many online retailers but it’s not for everyone. The important thing is to stay educated, up to date and current with the method and all that it entails.
 
Let us know if you have questions in the comments below!