| Dropshipping is like any business and the most | | | | hardware, for example, and using the drop shipping |
| important thing when starting out on any venture is to | | | | model, you may find it hard to be competitive |
| do your market research FIRST... | | | | price-wise and still make a profit. The difference |
| When you open a store in your town, you wouldn't | | | | between making money and losing it may be only a |
| open it without doing your market research first. The | | | | few percent. So be sure to pick a product that makes |
| same thing applies if you are going to sell something on | | | | sense to drop ship. |
| the internet as a dropshipper. Not only are there billions | | | | You will be using third party customer service so you |
| of web pages out there that could be selling | | | | will not have full control. Drop shipping is really |
| competitive products, the net changes so fast that you | | | | outsourcing your order fulfillment services to a third |
| are obsolete as soon as you have gotten started. | | | | party. You will be dependent on your drop shipper to |
| If you are going to set up a dropshipping business you | | | | have the products in stock, to deliver on time, and to |
| want make sure that the product that you choose can | | | | properly pack and ship your products. So pick your |
| be easily sold. And you want to know how many | | | | drop shipper carefully. |
| competitors you have. And you want to stay as up to | | | | At the end of the day, however, drop shipping exists |
| date as possible. Selling products on the Internet is | | | | because it works. And the largest catalog companies |
| easy. Hundreds of thousands of people do it every | | | | and web sites use it. And savvy small web sites and |
| day online on auction sites such as eBay. The most | | | | auction site sellers use it. Drop shipping is simply an |
| difficult part of internet sales is getting the products | | | | arrangement between you and the manufacturer or |
| delivered to the customer, otherwise known as order | | | | distributor of the product you sell whereby the |
| fulfillment. | | | | manufacturer or distributor -- NOT YOU -- ships the |
| You must have an efficient fulfillment system. One of | | | | product to your customers. |
| the reasons that brick-and-mortar stores are so slow | | | | There are a few huge advantages to this model. First, |
| on the uptake when it comes to online business, is that | | | | it SAVES YOU THE COST of building your own |
| supplying retail stores is done with pallet-sized orders | | | | inventory. If you're like most people starting a small |
| usually. But internet sales requires an entirely different | | | | business, you don't have much capital with which to |
| kind of fulfillment system. Selling on the internet is | | | | play with. The last thing you want to do is tie up your |
| essentially mail order, with shipments going out in small | | | | cash in inventory that you may or may not be able to |
| parcels to end users. | | | | sell. |
| Few brick-and-mortar retailers have a thriving mail | | | | Not having inventory also means no leftovers. If the |
| order business to draw from. An inefficient fulfillment | | | | product you sell suddenly becomes outdated, obsolete, |
| system can lose for you the advantages in good | | | | or just plain un-trendy, you aren't the one with a house |
| customer service that holding the inventory gained for | | | | full of stock that nobody will buy. Many online retailers |
| you. And running a fulfillment system is a full time and | | | | find themselves having to offer deep discounts -- and |
| trying job. | | | | taking huge losses -- on old products just to get them |
| One of the simplest order fulfillment models to use is | | | | out of their homes to make room for more inventory! |
| the drop ship model. Drop shipping does have its | | | | You'll also don't have to deal with shipping your |
| advantages and disadvantages. The most important | | | | products. Unless you've already set up a shipping |
| being you don't have to pay for anything until after you | | | | account with someone like FedEx or UPS, you'll be |
| sell it. | | | | heading down to the post office every day to buy |
| You also don't have inventory costs. Having to | | | | stamps and mail out your products. And you'll be able |
| purchase inventory to ship to your customers can be | | | | to ADD NEW PRODUCTS ALMOST INSTANTLY. |
| expensive not to mention risky. In addition to the | | | | Since you don't have to worry about ordering |
| out-of-pocket costs, you need a place to store the | | | | inventory, you can add products to your web site |
| inventory. | | | | within a few hours. |
| Finally you have to pick, pull, pack, and ship the | | | | If you find that your customers are eager to buy a |
| products once the order is placed. Having the | | | | certain product, you can have that item up on your site |
| distributor or manufacturer take all these costs and | | | | in almost no time. Finally spend time researching |
| responsibilities lifts a real burden off your shoulders. | | | | different kinds of products that you might want to sell. |
| Ideally a drop-shipper should be transparent. With most | | | | The products you choose should be in demand but not |
| of your drop shippers, especially those with whom you | | | | widely available online. As usual, I highly recommend |
| do a regular business, you can send them labels and | | | | targeting a niche market rather than trying to find a |
| forms so their package looks like it is from you. Your | | | | product that EVERYONE wants to buy. |
| customer probably won't know that your hands never | | | | Once you've found a product that you think may be |
| touched the product. The customer will think that you | | | | the right one for your business, you'll need to do a little |
| have a warehouse. | | | | "competitive analysis." This simply means finding out |
| You can sell many more products than you could if | | | | what potential competitors are charging for the |
| you had to buy and store them yourself. Drop shippers | | | | products you want to sell and calculating how much of |
| give you a wide choice of products so you can sell a | | | | a profit you'll be able to make. When it comes down to |
| lot more.On the Internet some categories of products | | | | it...its all about 'Testing, Testing, Testing!' |
| are very price-sensitive. If you are selling computer | | | | Good luck! |