What exactly is drop shipping?

The main concept of drop shipping is selling other companies’ products on your online store. This enables your business to offer a large selection of products without purchasing inventory or holding stock. It can be a great tool to help diversify your inventory and test products.

Benefits of starting a drop ship business:

1. No start up fees – most suppliers offer a zero-cost operation in return for your sales. Whilst starting a new business is never easy, this takes some of the pressure off having to invest capital in your venture.

2. No stock – having the ability to operate a consumer goods business without the need to manufacture or hold inventory is incredible and gives you the ability to operate from anywhere.

3. Low risk - Considering the above two benefits, this means it’s extremely low risk to start up your new business.

4. Run it your way – whilst the manufacturing and/or picking and packing element is out of your hands, you’re very much running the show with your UX and customers service and that can give you every personal touch you need to run a successful ecommerce business.

Our top tips:

1. Don’t assume that it’s going to be easy – we’ve seen many clients sign up to use our drop ship service, to never place an order. Whilst your business may be a sideline, it will still need dedication and commitment. We’d recommend investing in an eye catching, easy to use website and setting aside some budget for marketing.

2. Stick to a few selected suppliers – when starting your new venture, it might be easy to get excited by multiple channels, but it can become tricky to keep your supply chain under control. We recommend focusing on quality designs, best-selling products and good margins.

3. Check your numbers – for the hours and commitment that you are going to need to invest into your drop shipping project, you’ll need a good return on your sales. Set yourself a minimum margin and calculate your costs accurately. Consider if your supplier charges post fees and potentially pass this cost over to your customers.

4. Do the research – dependent on your target market, we recommend researching other businesses in your field and use your findings to list at competitive prices and with unique designs.

5. Provide amazing customer service – the way you handle customer orders and queries speaks volumes about your business. Provide your customers with everything that they need to know including clear delivery and returns information provided by your suppliers, and make sure that you’re covered should something go wrong.

We hope that our tips and advice help you on your drop ship journey. If you would like to sign up to our services. Click here.