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How To Drop Ship

How to drop ship so you can more easily grow and scale your company with less headaches.

Drop shipping has become a popular method of order fulfillment for a long list of reasons. Since you don’t need to store and ship the products you sell, you can quickly grow a startup business with very little cash upfront.

Learn how to drop ship to build up a loyal customer base and expand your sales without the expense and hassle of investing in lots of inventory or physically handling every item you sell.

Master the ins and outs of drop shipping and determine the best methods of selling for your particular business idea before you invest a lot of capital. The variety of items that can be drop-shipped is extensive; if you have an idea and a web store, there is probably a way to drop ship your product line.

The Basics of How To Drop Ship

Drop shipping is a business model in which you don’t warehouse or ship the products you sell yourself. Instead, your products are stored, packaged, and shipped by an order fulfillment company, saving you the expense and trouble of managing your own shipping. You purchase inventory more or less as you go, so you are not out of pocket for large amounts on the products you are offering for sale.

You create your own goods or purchase other products directly and incrementally from manufacturers or wholesalers and sell them online. Order fulfillment is handled either by the manufacturer of the items or by another company that stores your inventory and picks and packs your orders for you. Additionally, products in some cases may be branded by the same company that warehouses and ships them.

The drop shipping model allows you to get into e-commerce with very little capital upfront and makes it possible to scale your business effortlessly as your success grows.

DropShipping Business Models

The drop shipping process can be managed in various ways. Here are a few common examples:

1. How To Drop Ship With Amazon

When you sell on Amazon, you can opt to ship your products yourself, or you can drop ship through Amazon. If Amazon handles the packing and shipping of your orders, your products are stored in one of many warehouses owned and managed by Amazon.

Advantages include an instant customer base; Amazon has hundreds of millions of users. You can easily sell online as their is a low barrier for your customer because many people are used to shopping on amazon.

Technically, you don’t even need your own website. You can source products at a wholesale price from third-party suppliers, markup the product, and make it available on amazon.

Items can be shipped very quickly through Amazon’s order fulfillment process, often arriving to your buyers within a few days. There are no e-commerce design requirements for you to deal with; your products are automatically presented according to the basic information that you provide when you list your items.

There can be some significant downsides to this model of selling as well, however:

  • No control over branding
  • Very high competition
  • Small profit margins

Your products appear in the Amazon marketplace, which is more or less one enormous, generic superstore. You are often competing with multiple sellers of similar or identical products in the same store, and thus prices are extremely competitive and profit margins very slim.

When a customer orders from you, you don’t have full control of the entire experience or process. Plus, you don’t get the full customer information on the new products your clients are buying.

A common step some business owners take is to put some type of a bonus in their packaging. For example, you might include an insert in your package to drive your client to a set of steps where they may opt-in to access it.

With a bit of creativity, you can strategically set up your online business and fulfillment method so that you account for the client journey step-by-step. For example, you might put a QR type code on your package, or drive your client to a designated bonus page, so they get a video to know how to use the item they purchased from you.

This allows you to get some of the data of your customer.

You can even host client webinars to make them part of a community which can deepen the experience with your clients in a unique way.

The downside you have to factor in, is that when you set up your online store on Amazon, it’s presented in the same context and format. Your packages have Amazon branding, so it is very difficult or impossible to build any customer loyalty for your brand.

Without a strategic approach with your fulfillment method, you are using Amazon’s platform from soup to nuts, but you are building their customer base, not your own. You’re not in full control of your client experience. So, take the steps necessary to leverage Amazon for it’s marketing power and the benefits of drop shipping by strategically setting up a great experience and journey for your clients next steps.

2. How To Drop Ship With Shopify

Shopify takes an opposite approach to setting up your e-commerce store. With Shopify, you create an online store on the Shopify platform, complete with your own branding. When you sell products in your store, orders are handled by an integrated order fulfillment company.

This model works better to help you build a brand, rather than just selling products and augmenting Amazon’s business. You can develop customer loyalty, determine your own pricing, and have your own special promotions. You have far more control over how your products are displayed, sold, and shipped.

Most e-commerce platforms integrate with order fulfillment; Shopify integrates with a variety of providers. Select wisely. Compare services, business models, and shipping times to determine which drop shipping company provides the best service for your business and your buyers.

For example, Shopify integrates with the shipping company AliExpress. Integration is convenient for you, but the average delivery time with this company starts at 15 working days and goes up to 45 days. That’s at least three weeks and possibly longer before your buyers see what they’ve purchased from you.

Plus, due to the recent shifts in business, the supply chain has also been impacted, which can sometimes cause further delays.

The point is to ensure that the service you choose can provide the service your customers expect.

3. How To Drop Ship With an Order Fulfillment Provider

Amazon is the order fulfillment provider as well as the shopping platform. Some suppliers offer drop shipping on the products you purchase from them.

With Shopify and other platforms such as Wix, Clickbank, Woo Commerce, PayPal, and others, you sell and process customer credit card payments through the sales software and integrate with a drop shipping company.

The drop shipping company handles the packing and shipping of the order. Some order fulfillment companies offer printing and custom packaging as well.

Disk.com is a drop shipping company and order fulfillment company integrated with Shopify, Amazon, eBay, and more.

We offer a range of other services for products that can be drop ship as well.

We are experts at drop shipping products and have shipped over 4 million products over 40 years.

This includes dropshipping products like medical equipment, devices, nutrition supplements, books, and more.

We produce multimedia packaging for CDs and DVDs, print books, signs, magazines, and marketing materials, and provide binding for soft and hardcover books, journals, and other publications.

Disk.com also prints branded packaging for individual or kitted items to really make your products stand out.

In short, not all drop shipping companies are the same. Do your research and compare pricing, shipping timetables, and all services relevant to your product line.

Products That Can Be Drop Shipped

Are you wondering how to drop ship your product line? Maybe you’re not even sure it can be done. Here are some examples of the many products that can be drop shipped:

Health Products

Health products of every ilk can be drop shipped. This includes nutritional supplements, nutraceuticals, drink powders, and vitamins.

Medical Products

Medical supplies can be drop shipped. Common home tests and lab test kits are shipped directly from warehouses daily.

Books of All Kinds

With print-on-demand, almost any book can be printed, bound, and drop-shipped. You can drop ship journals, workbooks, best sellers, softcover books, hardcover books, textbooks, and cookbooks.

Multimedia Products

Multimedia items and packaging can be branded and drop-shipped. This includes USB flash drives, CDs, and DVDs as well as their covers and cases.

Educational Items

In addition to books, other educational materials for teaching and training programs, tutorials, and courses can be printed as needed and drop shipped directly to customers.

Tech Goods

Virtually any technical items, including gadgets and wearables, can be branded, packaged, and drop shipped.

Kitted Products

You can brand and drop ship kitted products, including gift boxes and welcome kits, as well as virtual event boxes and promotional items. These branded products help build brand recognition.

Continuity Products

Drop shipping can be set up to automate repeat sales promotions such as auto-shipping reorders. This provides convenience for both you and your customers.

Retail Favorites and Other Tangible Items

You can drop ship many other common and unusual tangible goods, including:

  • Clothing of any kind like T-shirts or Swag.
  • Jewelry and accessories
  • Sports equipment and workout products, even golf clubs
  • Musical instruments and supplies

The possibilities are endless with the right drop shipping company. If you have a product line or sell products from other manufacturers, your items can be stored and shipped.

With a full-service company providing on-demand drop shipping services like Disk.com, your products and packaging materials can also be branded. Proper branding helps you build brand recognition and a loyal customer base.

Having control of this type of process can also help you go from low margins to high profits and high impact in your business – while also eliminating a lot of stress and headaches.

What You Need To Start a Drop Shipping Business

One big advantage to the drop ship business model is the relative ease of getting started. You won’t have to lay out a lot of capital to get up and running; you don’t need to buy or lease a warehouse with packaging capabilities.

At it’s simplest, you can start your dropshipping store and company with nothing more than a concept and idea, getting a domain name, and products to make available for sale.

Of course, there is more to running a successful, high impact, high profit business, however, today’s opportunities allow you to get started easier than ever before.

Make sure you have these elements to get started and drop ship successfully right from the start.

1. Business Concept

It sounds obvious, but the first thing you need is an idea. What do you want to sell, and how are you going to promote your product line? Do you have a plan on how to drop ship your products and make them stand out from the crowd?

Business concepts are almost as numerous and as varied as business owners themselves.

For example, you could take a page from the Amazon book and simply offer the cheapest possible price on a line of products. Many drop shippers do exactly that, regardless of whether they use Amazon’s platform.

Perhaps you make your own products and you simply don’t want to handle order fulfillment for your product line. Maybe you want to buy various supplies and kit them together in branded boxes, or perhaps you want to design journals or a custom clothing line.

Decide what you want to sell and how you want to sell it.

2. Research

Explore the competition and test your product ideas in the market. Try selling a few of your items to gauge customer response before you go all-in on an item or an idea.

One way that the drop shipping business model helps you is that you don’t have to buy or create a warehouse full of products in order to launch your sales. Start small and test the waters; you can scale up quickly and easily once you’ve found your niche.

3. Suppliers

If you are going to sell products that you purchase rather than produce, you’ll need to source your product line from wholesalers and other suppliers. You can use supplier databases or you may opt to take advantage of one of the many apps that connect you to sellers.

Ensure that your suppliers will work with your chosen order fulfillment company.

4. E-commerce Website

You will need a website to promote and sell your products. You can use any e-commerce platform as long as it integrates with the companies you want to work with. Be clear on how to drop ship from your platform before you build your online store.

Your website is how your customers interact with your company and product line. This is the first point of contact between them and your products; make it count.

Your site doesn’t have to be fancy, but it should be organized, simple to navigate, and logical to use. Design it to be easy on the eyes and consciously use it to lead your viewers through the purchase process in an intuitive and natural way.

5. Capital and a Bank Account

You won’t need a whole lot of startup money, but you will need some. Set yourself up to win – even if you’re starting small. Set the stage so that you can be profitable.

Plan to purchase a small number of products or the materials to produce prototype items for testing your ideas. Set aside some cash for buying or producing more inventory when sales begin to pick up. Make sure to factor the main costs of the products plus hidden costs like the banking fees, shipping costs, and extra miscellaneous items. These things can add up.

You will need to spend some money on advertising to build a little momentum. You’ll have to get your name out there, which requires marketing. You may need to hire an artist or designer to create some basic branding for your products as well.

Regardless of what type of business you create, including e-commerce, you need to keep your personal funds separate from your business funds. This requires opening a separate bank account for the business. That’s not expensive, but it does take a bit of planning.

Tips To Manage Your Drop Shipping Business

You’re committed to the concept of a drop shipping business. You understand how to drop ship. You have your product line figured out and you’ve got your e-commerce site set up and ready to go. Now you’re wondering what you can realistically expect day to day as you run this business.

Be Ready for Occasional Mistakes

Bear in mind that you are the middleman and that you’re juggling suppliers, customers, and your order fulfillment provider. You are human, and you can’t control everything. This means some days, you or someone else is going to drop the ball. It also means that regardless of whose mistake it was, it’s your job to handle it.

Building a customer base means providing customer service. Do all you can to make things right with your buyers when their order is disappointing in some way. Don’t take it personally if they get upset. Let them tell you the whole story and actually listen. Then try and come up with a solution that will:

  • Show them you care
  • Rectify the problem
  • Keep them loyal to your brand

Put Customer Service First

Ensure that your shipping and return policies are clear and understandable. At a minimum, write and post your policies on your website and create an FAQ section to handle common issues with ordering and delivery.

Your site should accurately estimate when items will be delivered at the time they are ordered. If products are coming from multiple suppliers and will arrive on different days, make that clear. These are the major concerns for your customers. Specifically, they want to know that the order will be correct and that it will arrive when expected.

When you first launch your drop shipping business, you’ll probably be answering customer queries via email or phone. That can work while your customer base is still small, but it won’t serve you or them very well in the long run. Plan to subscribe to a customer management service as soon as you can afford one.

Mind Your Inventory

One thing you can and should control is your inventory. Keep close tabs on your available products. Ideally, you should have enough items in stock to fulfill orders as they come in. If you struggle to replenish supplies and/or if your drop shipper is having difficulty filling orders accurately or keeping up with increased demand, reevaluate your relationships with them.

If you have to switch to a new company, test their abilities up front. Make a small order and ensure they know how to drop ship your products before you commit to them on a larger scale. This is critical as your sales increase. You need your suppliers and drop shippers to be capable of handling the volume.

Your order fulfillment company should provide you with real-time inventory tracking, so you always know what you’ve got in stock and when it’s time to order more.

Scaling Up As Your Business Grows

The first great advantage of a drop shipping business is the ease of getting started. The perpetual advantage is the ease of growth. Basically, if your suppliers and order fulfillment can keep up with demand, your business can grow very quickly and with few limits.

You’ve got steady sales coming in from your online store. You have suppliers and shippers who are up to the job. You’re ready to scale your e-commerce business. Now that you understand the foundation of how to drop ship, all you need to do is to increase the volume of business you’re conducting.

It’s time to turn your focus to marketing.

Search Engine Optimization

SEO is simply the strategy of working with search engines to help them analyze the information on your website. When the search engines understand and can easily navigate your site content, you will get better rankings and more traffic from web searches.

Many e-commerce platforms help to automate SEO, but if you want to take full advantage of web searches, plan to outsource your SEO to an e-commerce marketing professional at some point. There are major benefits to using the right strategy, and best practices are evolving all the time.

Social Media and Email Marketing

Take advantage of social media platforms for marketing, too. You can hire social media marketing specialists, but you can also accomplish a lot on your own. Create a Facebook page and post to it at least weekly. Targeted advertising on social networks can be helpful, depending on your product line. Instagram, TikTok, Twitter, and email marketing can give your sales a real boost for little or no money out of pocket.

Paid Advertising

Because your profit margins are generally slim, the key to how to drop ship successfully is volume, and the way to accomplish the sales numbers you want is through advertising. You will need to spend a little money on promoting your website and your product line.

Choose your marketing carefully. You don’t need to part with a fortune if you spend intelligently. Consider your buyers and use everything you know about them to figure out how to reach them. Each product line has a unique audience. Focus on finding your fans with every advertising dollar you spend.

Business Infrastructure

You’ve already ensured that you can keep up with inventory and shipping as your sales ramp up. This means your work will not double as sales double, but your focus will shift. You’ll need to hand off customer service and basic office operations to some degree so you can focus on the larger decisions of expanding the business.

You’ll need to make marketing decisions and determine whether your product line will change or grow. How is your e-commerce platform performing? Could you increase your sales with improved branding or faster shipping?

Knowing how to drop ship is the first step of what could be a very long and lucrative journey. Your part in this adventure will change over time as your business grows.

Your Drop Shipping Business

Every drop shipping business is a little different, but the basic concept remains the same. Entrepreneurs purchase and sell products that are warehoused, packaged, and shipped by someone else.

You’ll have low profit margins relative to standard retail sales models. However, the time requirements, operating expenses, and headaches are far less than with a brick-and-mortar storefront. This sales model can be a side hustle or can scale to a wildly profitable small business.

Now that you have the basics of how to drop ship, it’s up to you where you will take your e-commerce business.

To learn more about integrating your online store with branding and order fulfillment services, get in touch with us at Disk.com today. We can help you grow your drop shipping business today!

August 12, 2022

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