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A guide to dropshipping

Posted by Logan Marshall on August 25 in 9. Types of Businesses |

What is dropshipping?

Some wholesale distributors offer a dropshipping service, where you advertise the products on your own website; once you make sale you take the money and details off the customer and pass the agreed amount to the wholesaler along with the delivery details. The wholesaler then forward the item to the customer. Depending on the wholesaler you choose and the agreement you come to they will either use blank packaging with no company details or your own stationery. This way the customer believes the product has been sold and shipped by you.

Why dropship?

Not every website or online business has its own product to sell and even if you do, it may be that your stock is limited or you want to broaden the range of items you are able to deliver. Dropshipping provides you with the perfect opportunity to do this. There is no need to pay up front for the items you wish to sell and by not having to hold your own inventory this means you will never be stuck with left over items you couldn’t sell. You can sell any item that your wholesaler sells so you are only limited by the products they hold.

A warning about dropship companies.

The hardest part of opening a dropship account is finding a wholesaler or a company that will dropship for you. The Internet has many sites but, unfortunately, not all of them can be trusted. You should always try and research any company that you intend to use for dropshipping because while it may be there products you are selling it is your customer base and your reputation you are risking. Always be very wary of any company that asks for money up front. Remember you are selling their products for them, and there really is no reason that they should ask you for a one time admin fee.

How to open a dropship account.

Once you’ve found a reputable company that you would like to place your business through then you will need to open an account. Doing so is usually a case of giving your name, address, email and possibly your website address. At this stage you may or may not be asked for your billing details and as long as the company are a reputable one (your research should give you an idea on this) then it is fine to do so.

Once you’ve opened your account you have done everything you need to. You are usually free to use the pictures and product descriptions that the wholesaler has on their own site, although for search engine purposes you are better scribing one yourself.

A final word.

One final thing to remember is the shipping price. A wholesaler will charge you their own shipping rates and these should be given either with the product details or on a dedicated shipping page. When pricing up any item from a dropshipper you must remember to include this shipping price in your own calculations. The easiest way, of course, is to simply charge your customer the same as the wholesaler charges you.

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