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8
After you have chosen the product or products that you want to sell, you will need to locate a dropshipper. Evaluate all of your options very carefully. There are literally thousands of companies to choose from. Unfortunately, there are dropshipping companies that are less than reputable. Some of these companies would rather steal your money than develop a legitimate business relationship. The only way to separate the good from the bad is to do your homework.
You should always ask for references and check with the Better Business Bureau, bbb.com, before doing business with a supplier. You can also research a specific company using Internet search engines. There are special sites and forums that are devoted to the dropship industry. If you dig up a great deal of negative information about a specific dropshipping company, you should be very leery about doing business with them.
You will also want to avoid the “Middleman”. Middleman companies claim to be dropshippers, but they are not. They purchase products from another dropshipper and then sell them to you. This is not necessarily an illegal practice, but it does eat up your profits. The companies that middlemen purchase from are typically companies that you could deal with directly. Before signing up with a dropshipping company, make sure that they are really getting the products direct from the manufacturer and not another dropshipper.
Finding a Dropshipper
Finding dropshippers can be as easy as searching with google for the keywords dropship, dropshipper .ect, but don’t expect quality dropshippers that are not already well in use by competitiors.
The best dropshippers are often found by deep link searching and through building one-on-one relationship with wholesalers, we will talk more about that later in chapter 8.
Or better yet, to find a ready-made list of reputable dropshippers updated every month, visit http://www.thedropshipperdatabase.com.
Setting Up an Account
To set up an account with a dropshipper, you must contact the dropshipper directly. Though this can usually be done by phone or online, some dropshippers may ask you to fill out and sign a formal reseller application. In some cases, you may also be asked to supply a tax ID number and business license. These items are easily obtained (see more info in Chapter Six: Profits and Taxes).
Minimum Purchase Requirements
Wholesalers usually have minimum purchase requirements, which require you to purchase a specific amount of products at one time. Fortunately, most dropshippers do not have this requirement. If possible, you should choose a dropshipper that is willing to sell you one product at a time. This will limit your out of pocket expense, plus you will not be required to store product inventory.
Placing Orders
You should place an order with your dropshipper as soon your customer has paid for the product. This will ensure prompt delivery. After you have placed an order, the dropshipper will send the product directly to your customer. Typically, the package will be marked with your name and address, so the customer will assume the product came directly from you. And in a way, it did.
Dropshipping Advantages
- There are many advantages to dropshipping, especially for new entrepreneurs. Here are just a few of the benefits:
- You can start a business with little or no out of pocket expense.
- You don’t need any experience to get started. Anyone can sell on the Internet.
- There is no inventory cost. You don’t pay for anything until your customer pays you.
- There are no storage costs. You never have to actually touch the merchandise.
- Dropshippers handle all of the shipping, so you don’t have to.
- You don’t have to limit your product offerings. You can sell many different types of products to consumers.
- Because there is virtually no financial investment required of you, dropshipping is a relatively low-risk business venture.
