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I'm an online retailer who deals with home appliances. Since I have limited space, my friends were asking me to go for dropshipping. Can anyone please tell me what dropshipping means and how it will benefit me?
Free Member, Joined :02/02/2007
No of Topics Posted : 122
Reply/Comments : 16
Drop-shipment is a type of retailing where the retailer does not keep goods in stock, but instead passes the customer's order and shipment details to the wholesaler, who then dispatches the goods to the customer directly. The retailer makes their profit on the difference between the wholesale and retail price.
In a nutshell, you market and sell a product online at a price you choose. After your customer purchases the item, and you receive payment for it, you place an order for the product you just sold with a "drop-shipper." The drop-shipper charges you a wholesale price and ships the product directly to your customer. You pocket the difference between the wholesale (or near wholesale) and retail prices. The best part is that you have no inventory to hold or finance, and no shipping hassles.
ADVANTAGES:
Dropshipping can be a very simple and effective way to get started in ecommerce. Many online merchants find dropshipping strategies are good way of minimizing stock holding, decreasing overall shipping costs and cutting down on delivery times to customers. The advantages of dropshipping can be summarized as:
(i) Freedom from space constraints: Dropshipping allows website owners to send single or low quantity unit orders gathered on their web sites to manufacturers, or wholesale warehouses, who in turn ship the items directly to the customers of the web site owner. Typically you take care of the promotion and collect the payment, and the drop shipper looks after order fulfillment. So there is no need to stock the items in your godown.
(ii) Low wholesale price: Dropshippers can buy in huge volumes this means they will be able to offer you the best prices on products and shipping, usually wholesale.
(iii) No up-front money required to buy stocks: There's no capital investment, no need to invest in stock and no danger of you suddenly having large stocks you are unable to sell.
(iv) Ability to sell a wider product range: Using dropshipping allows you great flexibility in terms of product range. Promote as much or as little as you wish. Since you don't need to give up-front money, you can deal or sell a wider range of products. Once a customer pays, you can contact the dropshipper for delivery.
Some dropshippers charge fees for registering new clients.What is that and why is it charged?If one is a dropshipper what conditions must one put to clients to ensure safety of transactions.Advance payments? Is accepting international payments through credit cards safe?
Free Member, Joined :06/08/2007
No of Topics Posted : 0
Reply/Comments : 2
Dropshippers may charge a registration fee:
1) to ensure the commitment of their retailers
2) to cover the administration cost of setting up their shipping logistic for them
The Dropshipper will only send the parcel to the 3rd party when they've received full and cleared funds from the retailer
There is always more risk for the retailer than the dropshipper, because the retailer relies on the dropshipper to send the parcels out in a timely fashion.
So as a dropshipper, you can't go wrong if you choose a method of payment that is covered like paypal, or a proper credit card/shopping cart company.
fashion closet international
Blackheath, United Kingdom
Free Member, Joined :01/03/2006
No of Topics Posted : 0
Reply/Comments : 3
Please tell me:
1) The customer will receive a document of the wholesaler with the wholesale prices, different from the prices he paid to the retailer?
2) The wholesaler would not be tempted to hold the records of the customers and get rid of the retailer in the supply chain? In the old way of doing business it could not be interesting, but now the wholesaler has a direct channel to the customer.
Free Member, Joined :06/04/2003
No of Topics Posted : 0
Reply/Comments : 2
I think that is right.If we do not make our channels strong,then how can we grow.I feel mainly wholesaler reveals prices when he feels that the retailer is not aggressive in selling.If the retailer is giving varied business to wholesaler then the wholesaler will never attempt unethical practices.
One can find a way out of this by first letting the goods come to retailer and then the retailer ships the goods in this way he can avoid losing his customer.But this puts a strain on time and money spent.
Free Member, Joined :06/08/2007
No of Topics Posted : 0
Reply/Comments : 2
The wholesaler has no interest in double crossing the retailer, it is like any partnership, most wholesalers don't want the hasle of retail, that is why they wholesale. By building a good relationship and service for the retailer, they increase their sales, because the retailer will work harder to sell, they both win. It is not in the interest of the wholesaler to bypass the retailer, because he doesn't know how the retailer is marketing the product. Even it he has the list of the customers, not all products are repeat business, for example the same customer would not buy 3 friges!. It is only a "potential" threat if the product can be sold time and time again to the end customer.
Another point is with regards to the invoicing. The wholesaler doesn't do this, the invoices are sent to the wholesaler by the retailer at the end of each day, the wholesaler bills globally the retailer at the end of each day or week depending on how it is set up.
It takes too long to build a good trading relationship with a retailer, really it is not worth it to destroy it because you will have to do it time and time again and your business will not grow.
fashion closet international
Blackheath, United Kingdom
Free Member, Joined :01/03/2006
No of Topics Posted : 0
Reply/Comments : 3
Hi, I do dropshipping since 1 year and I think that it's really very good way to earn money online. Drop shipping is a supply chain management technique in which the retailer does not keep goods in stock, but instead transfers customer orders and shipment details to wholesalers, who then ship the goods directly to the customer. The retailers make their profit on the difference between the wholesale and retail price.
Good Luck!
Free Member, Joined :11/27/2008
No of Topics Posted : 0
Reply/Comments : 1
More or less those browse forums or different sites in the web know about drop shipping or the drop ship business. But in India a single company will be found who has a large base of resellers and do business on line. You can see a large number of big retailers in India in different locations. All of them doing business through their Brick and mortar Shop. They do not think about increasing business through drop shipping. This Idea of drop shipping with using the resource of many resellers and grab a large number of customers from a single location through out the country is not mooted in any ones mind So E-bay is only one who is doing this business in India without any competition in this segment. It is the proof that the Internet is in its infancy in India. Only their are a hand full of Resellers in Hosting and Domain name selling in India and general business house understand Reseller as to became the business partner of Computer Companies Like HCL, WIPRO, HP, etc. etc. and so one can not see five names as a drop shipper here in different Consumer durable products.
Free Member, Joined :09/13/2010
No of Topics Posted : 0
Reply/Comments : 1
Is anyone aware of dropship companies in India. I plan to launch an eCommerce business next month. Was planning to collaborate with local suppliers but Drop shipping concept seems to be perfect solution. However, I didnt find any dropshipping companies in India.
Free Member, Joined :03/13/2010
No of Topics Posted : 0
Reply/Comments : 1
I vaguely remember that payment processing gateways do not like 'drop shipping'. If I remember it right, there is (or hopefully was) a clause in the agreement you have to enter in with CC Avenues (one of the leading payment processing gateways in India) that says that the products sold against the credit card payment are NOT drop shipped to the paying customer.
I would appreciate if anyone who has recently entered into payment gateway agreements add their comments.
Vertex Data Private Limited
Hyderabad, India
Free Member, Joined :07/22/2008
No of Topics Posted : 0
Reply/Comments : 1
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