Drop Shipping Ultimate Guide to Start Your Own Business
by using drop shipping firms to handle your orders, you could route all your eCommerce site’s orders to wholesalers, and they will drop-shipped your order directly to customers. And you as the online retailer can eliminate the expense of carrying inventory and the risk of being stuck with the goods if these goods didn’t sell.
Before you get started, consider these seven steps involved in starting a Drop Shipping business:
How do I start a dropshipping business?
Step 1: Decide to sell your products with or without your own website
You can start your drop shipping e-business either with or without having your own website. If you decide to sell with your own domain name, then you need to get your ecommerce site up. If you do not want the hassle of getting your own ecommerce site, then you could build your online store at eBay. eBay e-store site builder allow you to build your online store easily.
Step 2: Decide products to sell
Then, you need to decide what types of products to sell at your online store. You could identify a group of products such as electronic products, household electrical appliances, cell phones & etc. It is advisable to identify similar products or products under the same category to sell instead of totally different category products such as shoes and CD player. Because, by selecting products within the same category, you can give your customers more choice to choose from, and you can group two or more products in a bundle for promotion or marketing activities and you get more sales on each transaction.
Step 3: Locate suppliers who will drop-ship for you
After identify your products to sell, you need to look for your drop shipping suppliers. On time delivery is important to ensure the satisfaction of your customers; hence, be sure you check for the drop-shipper performance record before you sign-up an account with them. Discussion forum, message board and blogs are sources for you to find some hints or comment for the drop-shippers. Or you just simply key-in the drop-shipper name on the Google or Yahoo search box; you should get some information of your selected drop-shipper.
Step 4: Set up an account with the drop-shipper
Once you select a drop shipping company, you need to set up a reseller account with the company. This can often be done online or by phone, but some companies will require that you complete and return a reseller application to open an account. Some may also require a tax ID and a business license. Most drop shipping company will charge some fee to open their reseller account.
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Step 5: Advertise the product for sale online
Many online retailers failed in their drop shipping e-business because they could drive traffic or visitor to their website and convert these visitors to the actual paying customers. To get traffic to your product page (either your website or your eBay e-store), you need to advertise your products so that your products get exposure on internet and attract targeted traffic to your product page.
There are many ways to advertise your products. You could advertise on eBay, use pay-per-click (PPC) advertisement service such as Google Adword or Yahoo PPC. Or you could go for the cheapest but equally efficient way in driving traffic to your e-store: Article Marketing. You could write a review on your products in an article and put your e-store URL at the end of article or at the author resource box and submit them many article directories for maximum exposure. Many internet visitors will drop-by to your e-store via your URL link at the end of your article if they are interested to know more.
Step 6: The Product Sold & Place Order To Drop-Shipper
Once your have product sold, your customer will pay you on your selling price via your online payment system such as PayPal. And you place the order with your drop-shipper and pay them via their payment system at the agreed price, which is lower than your selling price, so that you could earn the profit.
Step 7: After Sale Follow Up
Many e-business entrepreneurs will miss out after sale follow up portion. Just because your customer has paid you and you have placed the order with the drop-shipper, it does not mean that this is end of the loop. Because if there are problem occur, you are the one who need to responsible in the eyes of your customers. Hence, you should follow up with your drop-shipper either via phone or email to ensure that ship out your order to your customer.
You should proactively follow up with your customer to ensure they have received their order and satisfy with it. Offer yourself as the personal contact for any issues that may arise. This is also a great way to sell customers more products because if your customers are satisfied with your service, they may give you repeat orders.
Who is the Drop shipper ?
The drop shipping business is a global business that spreads across all businesses and continents. The Dropshipper may be right around the corner from you in a large building with enough space to store a variety of merchandise. On the other hand the Dropshipper may be on the other side of the world. If you place an order today for merchandise you may receive it from Japan, China or anywhere in the world.
The varied modes of good transportation today make it possible to ship items within a two to three day period from anywhere in the world. Because of the dropship business more goods and services are available to people all around the world. The Dropshipper has made it possible to get things at a faster pace. Therefore any business with the necessary resources can become a Dropshipper. In order to be a dropshipper there are certain things you must have in place. There are four basic things needed to become a Dropshipper. They are money, facilities, merchandise, and staff. Money is always top of any list of needs in business. If you don’t have the money you may be able to find a means to get the money. You may want to consider borrowing the money from a bank.
A large number of businesses have to take out a loan to have start up money for such a large operation. Some businesses have to take out several loans in order to have enough money to get started. When you have the necessary collateral, and a good business plan, banks will usually help you with the monetary resources to start a drop ship business. In addition to money you need to find a suitable location with the necessary facilities to store large quantities of merchandise. Don’t forget to factor in the office space. Distribution facilities are usually not lavishly furnished as other office space. After all drop ship facilities are not usually open to the general public. Therefore there is no need for lavish chairs to accommodate clientele. Therefore you will see plenty of storage and hauling equipment scattered about in these facilities. A Drop shipper needs to have resources and contacts to get merchandise as cheap as possible in order to sell wholesale. The Drop shipper will find it also necessary to travel abroad and make contacts with merchants to get goods to wholesale. A large number of products that Drop shippers sell come from places like China, Japan, Taiwan and other countries abroad. Some drop shippers make two to three trips abroad each year to find merchandise to wholesale. Wholesale list are sent out to retailers to inform them of new merchandise when it becomes available. So any business that has these resources in place can become a Drop shipper.
Some chain stores have a drop shipper to handle the distribution of merchandise to customers. The Drop shipper is heavily used with catalog companies. Have you ever wondered why the address on the package delivered is not the same address you sent your order The Drop shippers address is not the same as the companys address. So who is a Drop shipper The Drop shipper can be any business that has the necessary resources in place. There are many other details that have to be worked out such as staff, insurance, policies, guidelines and transportation. All major forms of transportation will work with a Drop shipper and be glad to do business with the Drop shipper.
Why use the Drop Ship method?
The best answer to that are money, time, and success. Yes, the drop ship 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 drop ship method has helped many people to have a very good income without having to make a large of 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 drop ship 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. The 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 loosing 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 OneSource Directory offers you 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 EBAY what is selling now and how it is going. As we, all know EBAY 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 EBAY and many people go to EBAY to buy a product. The ease of using EBAY has caused many people to quit the mainstream of work and stay at home working from their home office.
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 dropship for you. There are others who will dropship for an additional fee. It will enhance your bottom-line if you find a company wholl dropship 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 companys 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 a Wholesale Shipper
A wholesale shipper is the ideal way to start a business with little to no funds. The wholesale shipper offers convenience, keeps the merchandise stored, and makes delivery as you request it. Depending on how hard and how much you wish to expand your business you can determine which wholesale shipper will best suit your needs.
In order to understand the role of the wholesale shipper we first need to understand product distribution. First, the product has to be assembled and packaged for resale that is where the Manufacturer starts everything going. The Manufacturer does not advertise or try selling the product because they are too busy making the product. Therefore, the wholesale shipper bargains with the Manufacturer to buy the product either in bulk or piece by piece. The wholesale shipper also bargains with the Manufacturer concerning the shipping, as this is a vital part of how the product is marked up. Now you the retailer look for a good distributor and wholesale shipper because in most cases they are both the same. After you make a buying agreement with the wholesale shipper then you are ready as the retailer to set up shop. You have your choice of a regular brick and mortar store or a virtual online store.
Today many people elect to have a website and to have an online store. The main reason being with the use of a wholesale shipper and the ability to do drop shipments a person can start a business with practically no money or a bit of pocket change. The wholesale shipper manages the buying of products, the storing, the shipping and even furnishing you with a website in some cases. The opportunity that you now have is unlimited it only takes a lot of hard work. Many business people are finding that being able to stay at home earn a sizeable income is more to their liking than going to work everyday. The wholesale shipper does the majority of the work while you as the retailer earn most of the profits.
In order for you to be able, to make it all come together you need a wholesaler’s directory. The number one Wholesale Directory is ONESOURCE by World Wide Brands. ONESOURCE gives you all the advantages that you would need to set up your business and keep it going making a substantial profit. They offer drop ship, light and bulk products, along with having over 9000+ suppliers. World Wide Brands has over three million products and import wholesale supplier’s products. The World Wide Brands is the “BEST” Wholesale and Drop-Ship Directory with Name Brands at the absolute lowest prices! The company offers quality supplies with secure purchasing.
If you have ever wondered how people make a lot of money on eBay then wonder no more. World Wide Brands is one of the most used companies by eBay sellers. EBay sellers have the option of just buying a single item for auction or buying in bulk for their virtual store. Since World Wide Brands is taking care of your order then all you are required to do is the billing and collecting of the money. They normally ship after you have received payment from your customer. World Wide Brand also only uses wholesale shippers to save both you and your customers.
There are of course other Directories available on line for you to check out. It would be a good thing for you to do just that and pay close attention to the wholesale shipping industry. The wholesale shipping program offered by different distributors may vary in that some only ship in bulk while others will ship both bulk and individual products. The wholesale shipper is the key to a good business that will last.
The Best Place to be is eBAY
One of the most reliable sources that you can use is eBay to become a seller. The process to become a seller on eBay is very simple and there is no need to worry about the company or driving trade your way. The requirements to become a seller are provide a valid credit/debit card and bank account information. If you do not want to provide this information, you can become ID Verified. It is highly recommended that you sign up to be a part of Pay Pal. Pay Pal is a valuable program that permits you to accept buyer credit cards and electronic check payments online. Pay Pal is vital because it keeps both the buyer and seller safe online. Pay Pal is an optional requirement but highly recommended. It is very easy to sign up on Pay Pal you can sign up when you list your first item or when you complete your sell your item form.
When you become a part of eBay, you must fill in your sell your item form. The reason is to create your eBay listing. You must select the type of format you plan to use for your sells. Selling formats consists of the standard online auction format, setting a fixed price, using your own eBay Store, or listing a classified ad. For those who plan on opening an online business and using a drop shipper, it is advisable to open up your own eBay Store. It is very advisable for you to explore eBay ahead of time so that you can determine the category that best suits your products. Look for items that are as the one is you plan on selling or popular categories that many customers seem to visit. Then when you think that, you have discovered the best type of product for your listing and category check out the drop shippers. Find out the most reliable drop shipper that carries the product that you plan on selling. Make sure the drop shipper is giving you the best price and has a reputation for prompt delivery.
Write a title that is clear, complete and descriptive. A well-written title that consumers will find easily when using the search engine is the key to driving consumers to your web site. Do not mention your drop shipper unless they are offering free shipping through the company.
It is true that some drop shippers will offer free shipping for a certain amount of sales and this can be a good thing to help you build volume. One nice thing about eBay is that you can offer details to help your item sell faster in the item specific option.
Next eBay offers a section that you can use to write an item description. This is your chance to really describe your item be clear and complete. Try to be a little bit creative by giving information about the item such as the history or ratings if possible but most of all try to relate to the customer why they would want to buy the item. One of the nicest things about eBay is the fact that you can show off your item with pictures or create a catalog for customer convenience if you are using a drop shipper that offers several products. All that you need to do is just click web hosting to use your own hosting service. You may select the how long your listing is going to run and change the listing when the item is gone or if no one is offering to buy. You can also state how many of the items you have the starting price or reserve a set price. eBay is truly the “best of the best” for those of us who have little to no funds and rely on drop shippers.
Do You Have An Ebay Store?
In this article we look at the benefits of having an eBay Store. Selling on eBay does not require you to have an eBay Store, but it sure does make things a lot easier.
There are 3 store subscriptions you can sign up for with eBay Basic (15.95/month), Featured (49.95/month), & Anchor (499.95/month).
Now most people starting out will of course go for the Basic store and not the Anchor. You would need to make huge profits to go for the Anchor store. We’ll talk more about the Basic, and Featured Stores here.
If you have a Basic Store you may want to consider upgrading to a Featured Store. Things have been changing with eBay stores and some of things I’m most thrilled with is the $30/month allotment of eBay Keywords.
Yes, that is $30/month each and every month worth of free eBay Keywords. With eBay Keywords you will drive more traffic to your listings by putting your ad at the top of the page for the keywords you choose. This also separates your store from other listings. This can significantly increase your store sales.
With a Featured Store you get double the web pages! Which only increases your presence on eBay. You can also reduce the size of the eBay header on your pages giving you a page thats more focused on your business. This helps build your own brand on eBay, and you can match it to your website.
With a Featured Store you get advanced monthly reports and traffic stats you can access anytime. I just love looking through my reports to see all the in-depth info that the reports give me. The Path Analysis allows you to see how visitors move around in your store. This is so important as you develop your business.
Owning an eBay store will not only bring you more sales, but it’ll cost you less by using it in the long run. These are just some of the many advantages of owning an eBay store. Once you own one, youll wonder why you didn’t go for it sooner.
Ebay Tips For Buyers & Sellers
As a buyer you are trying to find bargains i.e listings with the best price (Buy It Now Items) or listings with the fewest bids (Auction Items). Generally these listing are the ones that get the least amount of visitors, and most of the time it is because of missing keywords (Product Serial, Manufacture Name…etc) in the title field. Thus, the key is finding listings that contain misspelled keywords or listings that are missing important keywords in the title field. Since the default eBay Search box only searches the title field, you can often increase your chances on finding deals by checking the Search title and description check box.
The next thing you will need to know is the “Art Of Gaging An Item Price on eBay”. A nifty way to find the going price for an item is by looking at the ended listings. To search for ended listings, simply click “Advanced Search” link found under the upper right hand search box. And then check the “Completed listings only” check box before beginning the search.
Always Find Reserved Price Auctions. You will be amazed at how many people just don’t bother bidding when they see the reserve price tag, most of times the reserve price is less then 10% of the item going rate which means huge savings. Remember however to place your bid in the last 10 seconds.
A nifty way to save cash on items is by offering sellers an end bid early option. The key here is that you will have to find recently listed item (less then 100 views) and from sellers with fewer than 50 feedbacks. Try to keep your initial offer to no lower then 10% of the regular eBay price (See Gaging Item Price).
If you are a pro on eBay then you will mostly likely only bid twice on an item. The first bid is optional and it meant to take the item out of the Buy It Now, since you will be more likely to win the item at a lower price through an auction. The second bid should come on the last 10 seconds of the auction, this maybe longer if you are on dial-up
You can tell a lot about your competition (fellow bidders) by looking at their previously won items to see their bidding pattern. You will be amazed at how many people keep their last bid to a whole dollar, meaning you only need to add a cent to snipe them in the last 10 seconds.
You will be more likely to win an item at a lower price on a weekday then a weekend. The reasoning is simple, less competition, most people with jobs will be unavailable or less likely to bid, and thus increasing the probability of winning the item at a lower price.
Did you know eBay occasionally issues Paypal coupons that could save you anywhere from (5 % -10 %) when paying for your eBay items.
You can save a lot from buying from sellers with little or no feedback. But again the key is knowing your seller so you don’t get burned. Here is what I do before I place a bid, first I email the seller, asking him/her about the condition of the item. If he/she replies back then I check the email headers to get the remote ip address, I then go to a WHOIS database and verify the location of the seller. If everything is OK so far, I contact the seller through telephone to verify the item, its condition etc. Remember that eBay only covers up to $175, so its best to ask for insurance and always ask for shipping with tracking. Also I found its best to stick with Paypal as payment option.
As a buyer you need to be aware of the following points:
- Be suspicious of sellers with low rating.
- Be suspicious of sellers using stock pictures (pictures from manufacturers website).
- Sellers who use free email (Hotmail, GmailScience Articles, Yahoo..etc).
- Sellers who do not accept Paypal.
- Sellers who do not reply to email.
- Low rating sellers with 1 day listings.