Starting a Business Part 4: Selecting a Dropshipper

Because September and October are historically times when many people open their first business, this week is dedicated to topics surrounding starting your own business. While this is not an end-all-be-all list of steps you must take, they’ll help you get a solid head start on your new business venture. Thank you for joining us on this journey!

Selecting A Dropshipper

Drop shipping is a practice of order fulfillment where a manufacturer/distributor ships a product to a consumer on behalf of the retailer. Drop shipping can be very attractive because it helps to minimize risk and cost while offering convenience and practicality.

But how do you know what to look for in a dropshipper? Here are 10 questions that will help you select a dropshipper to fit your business’ needs:

How long has the dropshipper been in business?
Most likely you’ll want to choose a well established dropshipper.

Who is the dropshipper using for shipping?
Make sure that the dropshipper you choose is using a major shipping company to avoid problems down the line.

Who else is using the dropshipper?
Get an idea of who else is using the dropshipper in question and figure out where your company falls in the mix. You want to be somewhere in the middle- not the biggest client your dropshipper has, and not the smallest client on the list.

Can the dropshipper offer custom packing slips?
Being able to customize your packing slips ensures that you have the flexibility to offer things like coupon codes or a customer service phone number on your packing slips as you see fit.

Will the dropshipper send out order notification emails?
If your dropshipper will send order notification emails, that’s one less thing you’ll have to worry about when processing orders.

What is the dropshipper’s return policy?
Make sure that your dropshipper will not charge you outrageous fees to process returns, and that they will be able to update their records so you are not responsible for the cost of the returned merchandise.

Will they notify you of stock changes?
Unannounced changes in stock can end up leaving you short on the items most popular with your customers.

How much will you be paying exactly?
Many dropshippers only charge per order fees, but there are some out there that will also charge a “participation fee,” which can drive up the overall cost.

How will you be charged? What are the payment terms?
Get the details on the dropshipper’s standard payment terms and inquire about setting up flexible payment options.

What do the reviews say?
Go online to find out what people are saying about the dropshipper. Current and former customers are always likely to help.

(Special thanks to the current business owners in our online community who helped out with these posts!)

-Kate Pierce eCommerce Specialist

Related articles:
Starting a Business Part 1: Types Of Business
Starting a Business Part 2: Policies You Should Think About
Starting a Business Part 3: Choosing The Right Products To Sell
Starting a Business Part 4: Selecting A Dropshipper
Starting a Business Part 5: Logo Design
Starting a Business Part 6: How To Get Paid
Starting a Business Part 7: Marketing your Business

 

 

 

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