Guide to Successful Drop Shipping

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Introduction to Drop Shipping

First, what exactly is drop shipping?

When you open a retail store, you have 2 choices: to hold inventory, or not. You can buy products in bulk, unpack them, and ship them to your customers as you generate sales. OR, you can find a wholesale distributor who will warehouse the item for you and ship individual items directly to your customer.

Drop ship, “pack and ship”, “direct fulfillment” – they all mean the same thing. A distributor who drop ships will provide the reseller (you) with a wholesale price for a set of products that you can then mark up and sell to a customer. They will ship the item to your customer for you, and you never have to handle the product.

Inventory is an expensive burden to carry. Drop shipping allows the reseller to focus on marketing the business and eliminates the hassle, time, and cost of dealing with the actual products they are selling.

Now, where can you find reliable drop shippers?

Be careful! Many websites will tell you they have directories, all in one solutions, and that they themselves are drop shippers. It is very important that you take the time to research and explore the various distributors and wholesalers to find products you want to sell and prices that give you the ability to make a profit.

All of the suppliers that you find here from Inventory Source are VERY well established suppliers who have been doing wholesale and drop ship business for years, even decades. We only recommend suppliers that have a large selection of products, have established processes and policies, and that are 100% reliable and responsive to the resellers of their products.

How do you get started with a new drop ship supplier?

The first step is to submit a reseller application. Inventory Source provides you with direct access to all reseller applications for each of the suppliers in our network. Most wholesale suppliers will provide their applications directly on their website as well.

To apply as a reseller, you must have a reseller tax ID and a business bank account. Both are easy and very cheap to obtain, and are the first steps of starting any business. Legitimate wholesale suppliers will only work with legal business entities, so be sure to take the steps to obtain your local business license and reseller tax ID.

After submitting your application, the process could take anywhere from a few days to a couple of weeks. Large suppliers will assign you a sales rep, and that will be your contact for future questions, sales, returns, and any other business you have with the supplier. Smaller distributors will only have one or two reps for everyone, but the process is essentially the same.

You have your supplier(s)…now what?

The next step is loading the products into your ecommerce outlets. You should have a general plan of how and where you will be selling these products. Inventory Source provides you with product information in various download formats for you to use on your website, ebay account, mall stores, or wherever you are selling your products. If you are using Inventory Stores for your website, you can load supplier’s entire product line to your store by using the Product File Download Tool, a Custom File Service, or the full Inventory Automation Solution (for automated product and image imports every day).

However you access the products, you need to insert them into your website and marketing efforts. If you manage the information yourself, it is important to get images, descriptions, and all relevant information and organize it efficiently for selling. If Inventory Source is managing the information for you, the process is simple.

How exactly does the buying and selling process work?

Once you have your website or eStore up and running and filled with products from your chosen suppliers, it is time for business. When a customer buys a product from you, you will accept payment for the product for your retail price and shipping costs. For help with credit cards, see our “Guide to Merchant Accounts”.

Once you have received the funds, you place the order directly in your account at the distributor. This is typically either an email or an online order at the distributor’s website. You can see detailed information and instructions for each supplier in your Inventory Source account.

The distributor will then charge you for the cost of the item and ship the item directly to your buyer, and in most cases include your business name on the invoice, helping to build customer loyalty for your new store.

That’s it! You have just sold an item at retail and processed the order for your customer. From here, it’s up to you to plan and run your business.

When selling drop ship products always remember:

There is no magic formula or magic supplier when selling drop ship products.  Selling products is work, and you cannot just sit back and watch the money roll in.  A successful online entrepreneur (and that is what Inventory Source wants to help you become) is always developing a marketing strategy, maintaining a customer base, developing partnership relations, and constantly looking to expand with changes in products and offerings.  With some organization and the right tools (which we give you), you can build a successful eCommerce drop ship business from the ground up.

See a brief sampling of other guides listed on our main site for making your website successful, marketing your site, accepting payments, and more.  Inventory Source is here to help and can assist you with nearly all of the phases involved in building and running your business.  And do not worry, these guides are just a very small sample of our training materials.  We have more guides in the free internal account when you register, and on our support blog, and we are adding more each month based on changes in the marketplace and reseller questions.

We have materials targeting the needs of the newest online seller, as well as the largest eCommerce merchant.  You will have PLENTY of tips and tutorials to access from your InventorySource.com account to resolve any of your questions at the start.  You will also have access to all of the technical features you will need when you are ready to grow…and all you have to do is register for free with a simple email ID, and you will be on your way to launching a more successful retail business.

eCommerce with Inventory Source is ez-Commerce, so get started today!

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