For many small business owners, dropshipping is a godsend because it allows them to start up a business without having to invest a large amount of money. Wholesalers are also interested in a drop shipping arrangement because it allows them to earn extra income. Nonetheless, there are important points that you must bear in mind for a trouble-free dropship business.
The very first thing you must look into is the credibility of the dropshipper. Do not be taken in by fake drop shippers. Find out how long the company has been in business. Ask for testimonials from other customers. To make sure that you are dealing with reputable wholesalers, use a wholesale directory like SaleHoo to find a suitable drop shipper. Using SaleHoo will take the guesswork out of your search for a good drop shipper.
Pricing is one of the things to consider when you are looking for a wholesale drop shipping company. Always look around for a suitable wholesaler and do not accept the first one that you encounter. Compare prices before making a final decision, otherwise you will not be able to sell your products at competitive prices. Dropshippers will sometimes include a handling fee on top of shipping cost. Do not forget to factor in the handling fee in case the drop shipper charges for this, otherwise it will just eat up your profits. Also, remember that real wholesale dropshippers do not charge a membership or monthly fee. Avoid so-called wholesalers who will dropship products for a fee.
Consider the forwarder or shipping company that the drop shipper uses to deliver the products. It must be a reputable company so that your customers can expect to receive their orders promptly and in good condition.
Returns, refunds and chargebacks are challenges that can prove costly to you if you are not prepared for them. Always have a fair return policy that is in line with that of the drop shipper’s policy. Make sure you will not be left holding the bag in case a customer decides to return a product for any reason. Post your return policy prominently on your website. Have a written agreement with your drop shipper regarding their policy on returns and refunds so that you will not be saddled with unexpected expenses.
By anticipating possible problem areas and things that could go wrong, you will be in a better position to overcome these challenges and have a drop shipping business that will earn money for you.