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The 51ÊÓƵ Blog>How to Start Your Drop Shipping Online Store

How to Start Your Drop Shipping Online Store

Posted by Jesse Ness, 51ÊÓƵ Team

IfÌýyou’ve ever sold products online, chances are you’ve heard theÌýterm “drop shipping”.

It’s something many online retailers are familiar with, andÌýquite aÌýfew use itÌýforÌýtheir online businesses.

But what exactly isÌýit? And, more importantly, isÌýitÌýworth your time? Will itÌýbenefit your selling experience?

Hopefully, byÌýtheÌýend ofÌýthis article, you’ll have aÌýbetter understanding ofÌýdrop shipping andÌýwhether this business model works forÌýyou.

The 1-2-3’s ofÌýDrop Shipping

Basically, theÌýprocess ofÌýdrop shipping looks like this:

  1. You find aÌýwholesaler who sells mountain bikes forÌý$300.
  2. You list theÌýbikes forÌý$400ÌýonÌýyour website.
  3. AÌýcustomer sees theÌýbike, decides it’s aÌýgreat dealÌýand buys it.
  4. You buy theÌýbike from theÌýwholesaler forÌý$300ÌýandÌýemail them theÌýcustomer’s shipping information.
  5. The wholesaler sends theÌýbike toÌýtheÌýcustomer.
  6. You just made $100.

We’ll goÌýthrough some details toÌýgive you aÌýbetter picture ofÌýdrop shipping.
Many drop shippers can doÌýbranded packaging forÌýyour orders, soÌýnoÌýcustomer will ever guess you’re using drop shipping services. Reputable drop shippers are invisible forÌýtheÌýcustomer.

The majority ofÌýdrop ship suppliers receive orders via email. After theÌýorder isÌýplaced, they send theÌýinvoice andÌýtheÌýtracking number toÌýtheÌýstore.

Some ofÌýthem charge aÌýdrop-ship fee per order.

This happens because they normally send products inÌýbulk quantities, andÌýsending aÌýsingle product takes extra effort. They charge theÌýfee toÌýcover additional expenses andÌýinconveniences, caused byÌýpackaging andÌýstorage.

That isÌýdealt with inÌýtheÌý“Shipping andÌýHandling” part ofÌýyour invoice. Fortunately, this fee isÌýusually very small andÌýcharged per address, not per number ofÌýordered products.

Key Benefits ofÌýDrop Shipping

Arguably, theÌýbest feature ofÌýdrop shipping isÌýhow effectively itÌýcan accelerate theÌýgrowth ofÌýyour business.

Drop shipping stores don’t have toÌýworry about high start-up fees, inventory, orÌýdeciding which products toÌýsell. Drop shipping isÌýaÌýgreat way toÌýtest new product ideas.

This freedom allows you toÌýfocus mostÌý— ifÌýnot allÌý— ofÌýyour attention onÌýwhat your customers want. Your products are extremely flexible, meaning more customers will shop with you.

You’ll beÌýable toÌýsell your products inÌýaÌýnumber ofÌýdifferent markets, which means you can significantly increase your business outreach.

Customers looking forÌýspecialty products will come toÌýyou because you’ll have what other stores won’t stock. Being able toÌýsell toÌýcustomers onÌýanÌýindividual level will increase your popularity, your business, andÌýultimately, your success.

You can receive orders from anyÌýplace onÌýearth connected toÌýtheÌýinternet. Drop shippers will cover your back onÌýreturns andÌýdamaged goods replacements.

Thus, drop shipping truly gives you anÌýedge inÌýtheÌýonline retailing market.

Also read: How ToÌýFind aÌýManufacturer forÌýYour Product Idea

Drop Shipping Complexities You Should Know About

The key toÌýaÌýsuccessful drop shipping store isÌýfinding reputable andÌýtrustworthy suppliers.

When major parts ofÌýyour business are controlled byÌýsomeone else, you can only wait andÌýhope everything goes well.

You won’t beÌýable toÌýcheck theÌýquality ofÌýorders unless your customers give you feedback.

IfÌýyou work with several drop shipping companies, itÌýmay cause shipping delays andÌýextra costs.

For example, imagine that your customer ordered five items, andÌýthey are distributed among drop shipping services due toÌýaÌýlack inÌýstock. You’ll have toÌýpay fees andÌýshipping costs twice orÌýmore.

Also, beÌýready toÌýaccept responsibility forÌýevery error, whether it’s theÌýlack ofÌýproducts inÌýstock, bad quality ofÌýtheÌýorder, orÌýshipping delays.

These complexities might beÌýscary, but adjusting your business processes can help toÌýavoid such situations. Everything comes atÌýaÌýprice, andÌýifÌýyou want toÌýget your business off theÌýground quickly, drop shipping isÌýtheÌýway toÌýgo.

Picking aÌýDrop Shipping Supplier

While getting started can atÌýtimes beÌýaÌýtrial inÌýandÌýofÌýitself, there are ways toÌýmake theÌýprocess easier.

First, before doing anyÌýresearch, make sure your business has aÌýlicense. You’ll need aÌý ²¹²Ô»åÌý²¹²ÔÌý.

Second, define your industry. IfÌýyou’re aÌýsmall business that sells aÌýspecialized item, you don’t want toÌýcooperate with large suppliers. You are better off contacting aÌýlocal manufacturer.

Next, look forÌýsuppliers. But don’t blindly rely onÌýGoogle. There are many fake companies onÌýtheÌýlist, andÌýyou’ll have toÌýdoÌýproper research toÌýfind good ones.

Here are some things you should know before you start your research.

Ignore ugly website design. Suppliers don’t care about theÌýlook ofÌýtheir website. They have enough clients, even with aÌýsimple, Áª90²õ-²õ³Ù²â±ô±ð home onÌýtheÌýweb.

Most big suppliers won’t work with small business. They meet people like you every day, who promise them they know theÌýmain secret ofÌýmaking money, but not many ofÌýthem are actually worth cooperating with. Plus, suppliers want you toÌýorder big volumesÌý— theÌýbigger theÌývolume, theÌýmore profit they have. They always have aÌýminimum order value; ifÌýit’s $5,000, forÌýexample, that won’t work forÌýyou.

Good suppliers get overexposed very fast. AsÌýsoon asÌýthey establish aÌýstrong internet presence, they will beÌýcrowded with orders. That’s why itÌýmay beÌýhelpful toÌýread about where toÌýfind theÌýright supplier forÌýyour store.

IfÌýyou choose one ofÌýtheÌýfamous suppliers that advertise onÌýtheÌýnet, beÌýaware that theÌýprice may beÌýhigher (someone has toÌýpay forÌýtheÌýads).

BeÌýcautious ofÌýextra offers. Some suppliers get excited andÌýstart toÌýsell extra things like online stores built with their own programs. They will want you toÌýsell onÌýtheir website orÌýonÌýtheir online store. The problem here isÌýthat they are not good atÌýe-commerce, andÌýthey will never provide you with theÌýstore ofÌýyour dreams.

Avoid suppliers that charge anÌýongoing monthly fee toÌýdoÌýbusiness with them. The entry fee isÌýaÌýguarantee that you’ve come forÌýbusiness, andÌýtheÌýshipping fee covers expenses. Both ofÌýthem are legitimate, but monthly charges are not what you want toÌýpay for.

When contacting aÌýsupplier, take note ofÌýhow well theÌýrepresentatives know their business. They must have aÌýclear idea ofÌýtheÌýwhole assortment andÌýall theÌýproduct categories they sell. Some ofÌýtheÌýbest drop shippers will provide you with aÌýpersonal consultant that will lead all your deals. BeÌýcareful ifÌýyou notice that you speak toÌýaÌýdifferent person every time you contact theÌýsupplier.

Since most ofÌýthem are not tech-savvy, appreciate suppliers with real-time inventory, online catalogs, advanced search tools, andÌýemail support.

It’s aÌýgreat idea toÌýplace test orders toÌýsee how well andÌýsmoothly theÌýprocess goes.
Good suppliers will let you pay with aÌýcredit card orÌýsend you invoices.

For aÌýstart, try looking forÌýsuppliers onÌýthese trusted directories:

Starting Sales

AsÌýmentioned above, you can sell either onÌýyour websiteÌýor onÌýyour supplier’s website, forÌýexample, eBay.

Selling onÌýyour own website won’t give you asÌýmuch free traffic asÌýtheÌýmarketplace, but you also won’t have toÌýpay extra money toÌýtheÌýsupplier. IfÌýyou choose toÌýsell onÌýaÌýmarketplace, most suppliers will ask you toÌýauthorize andÌýcreate anÌýaccount, andÌýprobably charge anÌýinitial setup fee.

You need toÌýknow that 51ÊÓƵ allows you toÌýhave your storefront onÌýmultiple places while running all theÌýstorefronts from aÌýsingle control panel. That means that creating one 51ÊÓƵ store will let you combine both methods ofÌýdrop shipping sales orÌýchoose one inÌýparticular.

When you’ve started selling, don’t forget toÌý. IfÌýyou use drop shipping services, where your products are stored inÌýaÌýthird-party warehouse andÌýshipped out when people order, then you could have aÌýnexus inÌýmore than one stateÌý— check with aÌýtax professional orÌýlook onÌýstate government websites toÌýfind out.

Consider using these tools toÌýget drop shipping onÌýtheÌýgo:

Your Next Steps

DoÌýyou think drop- hipping isÌýtheÌýright solution forÌýyour business? Here isÌýwhat you can doÌýnow:

Also read: Should You Make, Manufacture, Wholesale orÌýDropship Your Product?

Ìý

About The Author
Jesse is the Marketing Manager at 51ÊÓƵ and has been in e-commerce and internet marketing since 2006. He has experience with PPC, SEO, conversion optimization and loves to work with entrepreneurs to make their dreams a reality.

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