An Introduction to Dropshipping and Online Stores
A growing trend on the Internet is the practice of Drop shipping. This is when a website has a store and when a person orders something, the owner of the store then sends the order directly to the manufacturer. The manufacturer then ships the order directly to the customer. The benefits to the website owner should be obvious. You can run an online store that ships products directly to customers without ever having to carry any inventory or ship any orders yourself.
For those of you new to this concept I can see your eyes lighting up right now and you’re saying to yourself “that’s brilliant, I need to get in on that. It can’t fail!” Allow me for just a moment to bring you back to reality a bit. There are several things to consider here: How do you contact these manufacturers? What products should you carry? What online store software is good to use?
Let’s deal with the first one. Simply Googling “Drop ship Manufacturers” is a good way to run into a lot of fraudulent websites. Scammers are involved in every form of online business opportunity so you need to just get used to it. And you also need to avoid them at all cost. There is only one legitimate drop ship source website that I know of, I’m sure there may be others. Worldwidebrands.com has an extensive network of drop ship manufacturers that you can have access to for life for a one time fee of $299. That may seem like a lot but on the other hand if you aren’t prepared to even invest that much in a business then perhaps being in business is not the right thing for you. That being said you certainly do not need to use a website like Worldwidebrands.com. Another method which is totally free, would be to contact manufacturers directly. To do this you should have a fairly solid idea of what market you are going to be in (we will discuss this more in the next couple paragraphs) and then determine who the top manufacturers are in that field. Now here’s the critical part: Call them. Ask them if they do drop shipping or not and what you need to do to begin to work with them. I recommend starting with a company that is not necessarily your main target company. If you’ve never done this before then more than likely you will screw up the first call or two and you wouldn’t want to burn a bridge with a top manufacturer before the bridge was even built. For this step and for your store in general you ought to have a PO Box for a company address so you look more legitimate.
Another major consideration is what software will run your store. There are some free options out there like osCommerce, Cube Cart, and Zen Cart. I’ve also seen a new company named Realstores.com which offers free stores but they are still in beta testing at the time of this writing. Most of the free site software packages offer quite a few customization options but will also have a “Powered by” branding on it unless you pay for a registered version. Yahoo and Amazon have pay stores as well as eBay. I recommend at least trying out a few different store solutions so you can determine which one will best work for you. Keep in mind that most of the free ones also have hundreds of community created addons that can make the store software more powerful.
I’d like to make a note about eBay stores. Most of the Drop shipping database sites will heavily push using eBay. This is solely for the purpose of trying to sign up more people with the promise of quickly getting started selling on eBay. I personally would avoid this approach at all costs even in the eBay stores. The reason for this is that with thousands of people signing up for these drop ship sites and selling on eBay, invariably the market on eBay is getting flooded and people are having to sell at lower costs and hardly making any profit which makes the entire effort pointless. You would do much better having a standalone site on your own domain name with a professional look to it and following the advice in my search engine optimization posts than by wasting time with eBay. Making money on eBay is definitely possible and many people make a good living doing it. I simply don’t recommend that route for Drop shipping.
Every step in this article is important and knowing what products to sell is as critical as the rest of them. You can have the best store software with the most professional design and catchiest name but in the end if you don’t chose your market wisely it won’t matter how good all that other stuff is. What you want to do is find a niche that you can conquer. Having 100 different categories of electronics items and 200 products in each category will not separate you from the pack. But specializing in HD TVs and equipment and not dealing in much else will give your store a very specific target audience that it will be easier to market to. As your business grows you can always expand later.
I know that the main part of this post is intended to be an introduction to drop shipping but I just wanted to touch on another area quickly. It is always a good idea to test a market before investing a lot of time and money into it. One way that you can do that is to use Amazon’s aStore. It’s a free store front that allows you to list whatever products you want to from Amazon’s vast catalog of products. The good part is that it’s completely free and easy to get started with. The bad part is that you won’t make nearly as much money per item shipped as you would with drop shipping and it is definitely a tougher task to get an aStore to look completely professional and integrated with a custom design. But it can be a very good choice for a fledgling website that is still building traffic. If you are shipping a number of items with your aStore then it could be a good indicator that you should make the switch into drop shipping.
Checkout all of the resources I gave you in this article and also consider getting a good book on drop shipping for more in depth information. You can run a successful online business. You just need to find an approach that works for you and maybe drop shipping is it.