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Drop Shipping - What is it and who are Drop Shipping Companies / Wholesalers?

Published on: December 13 2022 by Anton Kraly - Drop Ship Lifestyle

In today's digital age, starting an online business has become easier than ever. However, one of the biggest challenges is sourcing and managing inventory. This is where dropshipping comes in. Dropshipping is a business model where a retailer doesn't keep the products it sells in stock. Instead, when a customer places an order, the retailer purchases the item from a third-party supplier who then ships the product directly to the customer. In this article, we will discuss what dropshipping is and who the dropshipping companies wholesalers are.

What is Dropshipping?

Dropshipping is a supply chain management method where a retailer doesn't have to keep inventory in stock. Instead, the retailer partners with a supplier who ships the product directly to the customer. The retailer only orders the product when the customer places an order. This means that the retailer doesn't have to worry about managing inventory or shipping the product.

Who are Dropshipping Companies Wholesalers?

Dropshipping companies wholesalers are suppliers who offer products to retailers for them to sell to their customers. These wholesalers usually have a wide range of products that retailers can choose from, and they handle the shipping and handling of the products. Dropshipping companies wholesalers make it easy for retailers to start selling products without the need for inventory.

Advantages of Dropshipping:

- Low startup costs: Dropshipping eliminates the need for inventory, which reduces the startup costs.

- No inventory management: Since the products are shipped directly from the supplier to the customer, the retailer doesn't have to worry about managing inventory.

- Wide product selection: Dropshipping companies wholesalers offer a wide range of products for retailers to choose from.

- Location flexibility: Since the retailer doesn't have to manage inventory, they can operate from anywhere with an internet connection.

Disadvantages of Dropshipping:

- Lower profit margins: Since the retailer doesn't purchase the product in bulk, they don't receive the same discounts as wholesalers.

- Limited control over shipping: The retailer doesn't have control over the shipping process, which can lead to delays or damaged products.

- Increased competition: Dropshipping has become popular, which means that there is increased competition among retailers.

Dropshipping is a business model that has become popular among online retailers. Dropshipping companies wholesalers offer a wide range of products for retailers to choose from and handle the shipping and handling of the products. While there are advantages to dropshipping, there are also disadvantages. It's important for retailers to weigh the pros and cons before deciding if dropshipping is right for their business.

Hey guys, this is Anton from Drop Ship Lifestyle. In this video, I'll be answering the question that I'm sure most of you have, which is, what is drop shipping? Who are dropshipping companies, suppliers, and wholesalers? I'll cover all of that and also explain some common drop shipping scams, so you don't fall for them when you're just getting started with this business model. So let's get right into it.

What is drop shipping?

- Drop shipping is a form of business that involves selling products online while holding no physical inventory yourself.

- You're selling physical products online, but they're not warehoused by you. You don't buy them in advance. You're selling them for other companies.

- These items can be sold on Amazon, eBay, or on your own website. On your own website is where I prefer it, and that's what I advise others to do as well.

- Drop shipping is also a way to get started with selling online with no investment.

Types of drop shipping companies:

- Private brands: these are the type of company that we want to sell for because they do not sell directly to the public. They only work with retailers like ourselves. Their job is to sell to retailers and build their brand up to increase their brand's value. They enforce price controls, and the most common example of this is MAP (minimum advertised price). This is a great way to increase profit margins.

- Middlemen suppliers: what they do is basically advertise that they dropship. They send you a price list, and then you can make up your price and sell at whatever price you want. It's an easy way to lose a lot of money because your competitors can be selling at a 5% profit margin just to increase their sales and saturate the market.

How does drop shipping work?

- To start, you get approved with a drop ship supplier. This supplier has at least one warehouse located somewhere in your country (e.g., the States).

- Once you get approved for an account, you get a price list from the drop ship supplier. You can then upload their products onto your website and start bringing in sales.

- When a customer buys from you on your website, you then buy from your drop ship supplier. You collect money at retail what the customer pays you and pay wholesale your price to the supplier. The supplier ships the item directly to your customer, and everybody's happy.

Common drop shipping scams:

- Any company that charges you to become a member or advertises that they dropship.

- Stay away from these companies because they don't enforce pricing policies like MAP. They also advertise to thousands of money-hungry retailers, so all of these niches are saturated.

- Another thing that does not work is dropshipping on eBay and Amazon because real suppliers don't allow it. They don't want their products on those marketplaces as it lowers the value of their brands and they also have no pricing controls and no inventory control.

How to make money dropshipping:

- Niche selection: find what types of products sell well online when dropshipping.

- Market research: find out if there are dropshipping companies available in your niches.

- Create your online store.

- Reach out and get approved with dropship suppliers.

- Optimize for conversions: use certain tricks and tactics that make customers as likely as possible to buy from you once they find your website.

- Generating traffic: put your traffic sources in place and start bringing in those customers.

- Business automation: use some tools online that make your business basically run itself.

That's it for this video. If you want more information on this process, please reach out to me at Drop Ship Lifestyle. My name is Anton Kraly, and I'm the founder of this program. Any questions, please contact me, guys. I look forward to speaking with you.

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