How does international dropshipping work?

How does international dropshipping work?

There are two ways to look at what is considered  dropshipping internationally.

  1. Your customers and supplier are in a different country from where you are based.
  2. Your supplier is in a different country from the majority of your customers.

#1 One form of International dropshipping I guess you could call it is if your supplier is located in a different country than your business. For example let’s say both your supplier and customers are in the UK however your business is legally based in the US. If 100% of the customers that you sell to are in the UK then shipping policies don’t play as much of a factor as #2, however if you are based in the US you will just need to be sure your dropship supplier accepts resellers from other countries. You will also want to be sure you calculate currency conversions properly when calculating profit. You are also at the mercy of the exchange rate. Lastly….taxes….consult your CPA.

#2 Now the more common use of the term “international dropshipping” is when your supplier is based in a different country from where your company and a majority of your customers are based. This obviously can have a huge impact to the customer experience. The first question to ask is, “Does my dropship supplier ship to customers internationally, and if so what are the shipping rates, delivery times, and  policies?”. If so understanding the time that it takes to ship the product from your supplier to your end customers should be communicated clearly to the customer. If you are commonly shipping internationally, it may factor in to the type of product and buyer you target. Some buyers and product lines may already come with the expectation of longer shipping times. One example is when customers are purchasing anything that is customized (even slightly), their expectations are usually set for longer ship times. Also more expensive and unique items usually come with a longer shipment expectation. However with the booming ecommerce global economy, many international shipments are arriving at the door step of your customers quicker than one would expect.

The other areas to consider when shipping internationally are breakage, weight, and price. Shipping a product that easily breaks, is heavier than average, or doesn’t hold a profit margin to justify the higher cost in shipping, can sometimes outweigh the opportunity you may have with an international supplier.

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