| Remember the last time you were learning to
do something new and you made a mistake? It seems everyone has at least one of those
memories. Some of us have many of them! So, wisdom has taught us the following: When you
are learning to do something new, it's common to make mistakes. Often our mistakes are the
real lessons in life. We make mistakes because we simply do not have the past experience
to know right from wrong. We can carry this same wisdom over to the world of drop
shipping.
There are many Website owners trying to find authentic drop
shipping companies for their online retail business. An authentic drop shipper is a
supplier of wholesale products who will drop ship single item orders direct to your
customers. Our business (www.hienotedirectory.com) is focused on researching and
publishing information about authentic drop shippers for Internet based retailers. Our
experience has taught us the do's and don't of identifying authentic drop shippers. Let's
now cut to the chase. In finding an authentic drop shipper, it is important to avoid the
three M's.
What are the three M's of drop shipping?
- (M)inimum orders
- (M)iddlemen
- (M)embership fees
We are going to examine each one of these to get a better
understanding of their meanings, and how they impact you as an Internet retailer.
Quick Lessons For Success
Okay, let's see:
- You have your website running.
- You can accept payment from customers.
- You have good drop shippers to supply product... or, a least
you are thinking you do. How do we know for certain?
As a quick check, we are going to validate the last bullet
by seeing if we avoided the three M's of drop shipping.
1. Minimum Orders.
An authentic drop shipper does not require you to buy
minimum amounts of product to do business with them. An authentic drop shipper will drop
ship in single item quantities to your customers. Sometimes, companies require minimum
orders because they cannot absorb the cost structure of single item drop shipping. Drop
shipping is generally more expensive to do for the supplier. To offset their costs and
unload the products, they will require you to order product you do not need. As an online
retailer, you will want to avoid this situation.
2. Middlemen.
This is the classic, unnecessary, middle layer of
distribution. Middlemen, as the name implies, are the people in between you and a drop
shipper. When you place an order with them, they order product from the actual drop
shipper. Take their slice of the profit and have the real drop shipper send the products
to your customers. They can also steal your customers as they are getting all of the
shipping and contact information from you. At that juncture, they can send whatever they
want to your customers such as advertising with lower prices. These folks should be
avoided whenever possible. They are taking your additional profits by giving you pricing
often close to retail. In some situations, they can also lengthen the delivery time to
your customers. Again, you do not want this to happen. You need to ask the correct
questions in order to avoid these folks. Questions such as, 'Are you the manufacturer of
the product?" Or, 'Do you stock inventory of the products you sell?" are good
questions to ask. We even ask folks to arrange a time for us to come visit their
warehouse.
3. Membership Fees.
An authentic single item drop shipper will not require you
to pay membership or processing fees. Should you be paying someone to sell their products?
No! Beware, they could be a middleman. Avoid any membership fees or dues. An authentic
drop shipper does not require membership fees to sell their merchandise. In some cases, we
have found that these so-called drop shippers charge membership fees for products that
might not be doing well in the market place. The supplier wants to make sure they make
money by charging 'monthly fees" as they know you will probably be struggling to make
money selling their products.
How you spot an authentic drop shipper.
Now that we have an awareness of the three M's to avoid, we
can summarize some of the rules and validations for our drop shipper search. Our checklist
of rules can begin to look something like the following:
- They will drop ship single item orders without minimum
requirements.
- They will not require you to pay any member fees or monthly
fees.
- They will offer you true wholesale pricing so you can make a
profit.
- They will not put any of their own promotional materials in
with your customer's order.
Once a drop shipper can meet the above criteria there are
other logistical items to consider such as the following:
- They will put your company name on the shipping label.
- They will ship in a plain box without any of their company
logos or information on the box.
- They will include a plain invoice in with your order without
any pricing.
There are other items to consider for an authentic drop
shipper validation, but the above lists can get you going in the right direction.
Remembering to avoid the three M's can prevent those costly mistakes in your online retail
business. |
