Drop Shipping as an E-Business

As an Internet Entrepreneur, you may want to consider drop shipping as a viable business.  Drop shipping involves an arrangement between you (the Internet retailer) and a wholesale merchant.  You agree to market the item on your website and, upon an order for the product, you arrange to have the item shipped directly from the wholesaler.  You get to pocket the difference between the retail price and what the wholesaler offers you after shipping the item.

Here’s how it works: You market and hopefully sell items of your choice at a price which will give you a profit at the end of the deal.  You take orders and receive payment for the item.  You then turn around and place an order to ship the item with the wholesaler (or drop shipper) who will charge you their “wholesale price”.  The difference is all yours. 

While it sounds like a home entrepreneur’s dream, you need to think carefully about what you’re going to market and whether or not anyone will buy it at the price you wish to sell it at.  Even though you won’t have tons of merchandise hanging around your house, you’ll have to represent each product you sell with pride. 

So, what kind of homework do you need to do? 

1. You need to find a saleable item that will sell at a reasonable mark up. This means finding out how big the demand is for your items and who else is selling the same thing at a better price than you will be.
 
2. Find a drop shipper you trust.  There are scam wholesalers everywhere.  Look for a directory of legitimate wholesalers, such as is listed at http://www.worldwidebrands.com. You’ll find an up-to-date list of wholesalers with decent reputations.

3. Stick with the same market and sell only a few in-demand, quality products.  If your products are all within the same market, you’ll be able to concentrate your efforts at marketing your products with style.

4. Remember, you are the retailer.  There will be returns and items will be placed on backorder.   You’ll need to work on a continual basis with both the shipper and the client to make sure your client is happy. 

You can basically drop ship any item that people will buy.  Books are commonly drop shipped.  There are eBay sellers who drop ship many of their items as well.  They offer their items for bid or retail sale and send the order to ship to whatever wholesaler they are currently using.  There is currently a large increase in drop shipping in all areas of the Internet.

While not without its risks, drop shipping can provide you with a source of income through your imagination and your Internet resources. It may be an income source that’s worth your time and effort. 

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