Drop shippers are wholesale suppliers that ship products to your clients from their place of business, such as a warehouse, store front or even a home based business. 

By using drop shippers, you don’t have to pay up front for merchandise you plan to sell. You don’t have to store anything nor do you have to ship anything. You place product information on your website such as images and their descriptions.   Any orders you receive through your website are either phoned in, emailed or directly entered into the drop shipper's website. They will ship the product directly to your client.  It’s that simple.  Or is it?  Better keep reading!

Most drop shippers have a form you fill out to get set up with their company. Some charge a set up fee or monthly fees and some even penalize you if you don’t meet monthly minimums etc. so beware and always read the forms thoroughly and if they don’t specify, ASK.  Failing to do so can become very costly!

How does the money work?  You, the client, pay the dropshipper for their product while in turn, your customer, who orders through your website pays you.

Where do you make your profit?  Drop shippers discount their goods to you so that you can in turn make a profit on the products you are selling. How are they able to do this? Because they save time and money by not having to market and solicit business through the general public itself.  Those expenses may include but are not limited to: sales representatives, marketing advertisements, marketing materials, website optimization etc. 

Sound easy enough?  Only on the surface!  Please don't come into this business thinking you can put a website, post some products and the traffic is just going to pour into your new store.  Not going to happen!  Take it from someone that learned first hand.  While the vendors job is important - making the gifts, keeping up with inventory, making sure it's shipped appropriately and timely etc.  The website owners job is just as hard and just as important.  You have to keep up with the ever changing internet!  Not making the constant changes to your website to keep up with what is working today means failure tomorrow if not sooner.   This is not written to scare you off, actually the exact opposite.  If you possess the knowledge up front of what it is going to take to make your internet business successful you are even more likely to succeed.  So do as you should with any business, research, research and research some more to be sure you have the time, energy and know how to make it work.

Common discounts in the drop ship industry range from 5% - 45% and sometimes more.  Usually, in turn for the higher discounts, you will end up paying a monthly fee.  If you are marketing your site effectively and your volume of sales is good in number, it may be more profitable to pay the monthly fee.   For those just starting out however, it may be better to choose companies without incurring monthly fees.  Proper search engine optimization and getting your site established can take several months or even longer if your time is limited.  Paying the fees with no income from your site...well, you get the picture.

Word of warning! There are many companies that claim to be “drop shippers” when indeed they are just a middleman. They have the wholesale source you are looking for and are giving you less of a discount than they receive so they can make their money.  If time and motivation permits, you can always put in some legwork and hopefully find the source for yourself.

The drop ship business, from either side, be it the the vendor or the client is not a get rich quick business by any means.  However, if you do your research and know your market, it can be profitable.

S. Dawson