Drop Ship or not ship?
2010/11/17 6:00 AM
I 
got so many great comments and emails on last weeks post on how to maximize 4th Q and questions galore about drop shipping and what it means and how it works…….so you ask, and I answer!
So what is Drop Shipping?
This is usually when a website displays your product for sale, but does not buy and stock it in advance. They sell it "like" they have it in stock, but in reality, they send you the order and have you ship it. What is so great about drop shipping? I like that other people are marketing and promoting your brand while you are doing other things that require your attention. Be sure you have done your due diligence in reference to the merchant – be sure you like their website, feel it is the right place for your product line to be sold, and I'd be sure to check out their marketing techniques and be sure you are satisfied with their business practices before you sign on the dotted line.
This relationship can work out nicely if you up the charges a bit. What I am saying,is that instead of offering them the items at wholesale plus shipping (follow your shipping standards) you add on 25% of the wholesale price as a handling fee to cover your costs of shipping out one item at wholesale.
For example: Let's say your item's wholesale price is $10 x 2.5 = $25 retail. You would require them to pay $12.50 wholesale ($10+25% of wholesale + shipping) as the “fee” for doing drop shipping. The website retailer will usually email you an invoice to put in the box.
I advise you to have the merchants credit card on file (see sample of drop shipping guidelines from my company) and charge their credit card for the item + shipping, before you ship directly to the customer. If you use a fulfillment house this 25% extra usually covers the fees involved so it doesn’t eat into your margins. If you are shipping yourself then you just made extra money! Go out and celebrate!
Download Drop shipping guidelines from my company Simply Sarah
Download sample credit card authorization form from Simply Sarah
There are tons of websites that do drop ship programs……even Saks.com does a HUGE drop ship program!
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There are 10 comments
Linda Edwards says: Thank You for this article! While setting up my E-boutique I have found this option very useful. Drop Shipping has allowed me to bring a wider selection to my customers, that may not have been possible if I had to carry a full inventory.
Excellent article Sarah. Short, to the point, and absolutely demystifies the whole process. Thank you!
Great article! You simplified it very well. I drop ship with that small mark-up for those who market my book on their site and it works well for everybody. And I’m always looking for more affiliates by the way!
Thank you for giving us “Drop Shipping for Dummies” Sarah! We have been approached by several drop ship web sites and I honestly have not “gotten” it. This helps explain the process and some pros and cons. Appreciate the info and may look at this for 2011.
You rock!!!
Wonderful information! Thanks for putting it out there and for making it easy to understand!
This is great advice! It does take time to fill the order and since most of the time it is only 1 item being shipped, this formula makes total sense. We have to keep in mind that the internet retailer does not need to stock the item, therefore costing him “nothing”, as well as not having to actually pay to stock the item the way a brick and mortar store does.
My question is, should we tell our drop-ship-only customers that this will be a new policy effective on such and such a date, or just institute the policy?
That is exactly what I was looking for! I have got an offer from one nice web site asking for my terms and conditions for drop shipping, and was totally puzzled… Will try it definitely! Thank you!
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Manufacture a Clothing Line? Offer online specials and encourage your shoppers to hold Zoom dinner parties and dress up. Book a call with me today and learn how to get through this crisis. sarahshawconsulting.com/sarahshaw/apply-case-study/
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It’s awesome that other people are marketing and promoting your brand while you are doing other things that require your attention.
Read on: sarahshawconsulting.com/drop-shipping-2020/
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Can you share what's working for your company today?
Any kind of PR is good PR...... especially when it takes 5 minutes and is free! I'm putting together a collaborative blog post and need your input! Since our normal way of doing business has changed, we have been forced to pivot to stay nimble during this unprecedented time in our lives.
Share all your awesome info here: sarahshawconsulting.com/how-are-you-making-money-today/ I'd love to hear new ways of doing business that you have discovered or invented during Covid shutdowns.
How are you getting online sales?
Are you still selling wholesale?
Are you drop shipping?
If you relied on pop-ups, what is your new normal?
Have you turned to advertising to drive traffic?
Are you seeking more PR?
And anything else that is working for you..... I want to know and learn from you too.
Please share ways that your company has pivoted during Covid-19 shutdowns and limitations and how you are making money today. Requirements:
Please share a short paragraph and give us your best tips!
Please add a headshot and some product shots as well if you'd like. Photos must be 300x300 px and 72 dpi or the system will reject them.
Share all your awesome info here: sarahshawconsulting.com/how-are-you-making-money-today/ I'll be sure to let you know when the post goes live later this week so that you can share it too.
Want magazine editors to try your products? Pitch them to write about zoom dinner parties and encourage them to dress up. Send them something to wear.
Book a call with me today and learn how to get through this crisis.
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