Drop shipping is an order fulfillment method that allows a merchant to buy a product from a wholesaler and have it delivered directly to a customer. When done right, dropped items will be accompanied with the same branding, shipping performance, and customer service as if they had come from the merchant’s own warehouse, while mitigating storage and delivery risks.
It’s therefore not surprising that many new retailers are choosing to go the drop shipping way. That said, you still need to know the rules before throwing yourself into the game.
Below are a few essential tips to starting an online drop shipping business:
- Pick your niche
Many merchants make the mistake of starting out in different markets and working from there. For a chance in the competitive world of drop shipping, start by choosing a niche that you know and understand. This will not only help you cater to your customers better but will also earn you a respectable seat at the negotiation table when dealing with wholesalers.
- Find quality suppliers
In the traditional business model where retailers hold the inventory, they’re able to deal with any unforeseen issues with the stock to ensure maximum customer satisfaction.
Drop shipping denies the merchant the certainty that comes with being in control of the process. If the orders delivered to your clients are sub-par, there’s little chance to fix what went wrong yourself and repair your damaged reputation. This is why finding the right supplier is so crucial.
- Start local
Among the reasons merchants choose the internet over physical stores, is that it opens up a business to a boundless market. However, because of the additional in-betweens that come with drop shipping, it’s better to start small. In addition to being more manageable, starting local makes it easier to keep in touch with suppliers and customers ’while you grow your brand.
- Add value
Merely being a middle man might work, but to beat the competition, you’ll need to add value to your product.
If yours is a t-shirt business, for example, simply making orders from a supplier and having them delivered to a client won’t cut it. Instead, find out ways to make your t-shirts stand out, by sending your own designs to the supplier. Original designs will not only set you apart from the hundreds of drop-shippers out there but will also increase your profit margins.
- Have a great website
In a nutshell, a website drives your whole drop shipping operation. For the best chance at success, therefore, your site should be as appealing as possible.
Also, keep in mind that it’s from the website that you’ll be collecting payments. Online shoppers typically complete purchases with their credit cards, so you may want to partner with a merchant account provider that accommodates your type of business. eMerchantBroker, for example, offers excellent payment processing services to drop shippers across a wide variety of niches.
Drop shipping may be the easiest way to start an online business, but that doesn’t mean you’re safe to go in blind. Let these tips be your guide to laying the best foundation for success.