What exactly is drop shipping, and how can it help you make money while you build a base of satisfied (and returning!) clients? The answer lies in discovering how dropshipping can help you keep prices lower than retail stores, while ensuring a smooth and effective buying experience for the customer. This form of commerce is actually quite simple, and that is why the number of customers not only willing, but enthusiastically motivated to use drop shipping grows every day.
An explanation of dropshipping starts by exploring how products generally get from the manufacturer to the buyer. In extremely rare instances, there might be a store at a factory where you can buy something “hot” off the manufacturing line. However, in all other cases the product is shipped to an outlet, such as a store, where it can be sold along with many other items. The store and the manufacturer have to use what’s called a “distributor” to decide what products are right for that store. And, of course, the store, the distributor, and the manufacturer all have to make money. All three steps in this normal retail chain are looking for a profit on one product!
The obvious problem with that model for the consumer is not so much what the distributor charges, but what the store must do to make a profit. Stores have very high overhead, from marketing and advertising to employing salespeople and paying rent. The store must mark up the product to pay for all of this overhead. Drop shipping makes you the distributor and cuts all these store costs. All those retail expenses become irrelevant and eliminated, and the price to the consumer goes down.
The only things you need to become a successful dropshipper are an entrepreneurial spirit and a good business sense. You can create more than one drop shipping website and therefore more than one business, and work with more than one dropshipper to optimize your results. The best part about being a drop shipper is that you can sell products that you are passionate about, and make money. You will be happier with your businesses if you are selling something that you truly care about and that passion will likely show through to your customers.
If you’ve ever bought something you knew was cheaper on line than in a store, they probably used a drop shipper. Sites like eBay and Yahoo Merchant Stores are a great place to start because they have tools to help you build your site and connect with dropshippers. However, you could also create your own independent websites that showcases your products and allows people to purchase them there as well. Either way, drop shipping is a wonderful business because you are truly providing value and cost savings to your customers while making money for yourself.