Dropshipping is an order fulfillment method that relieves businesses from keeping products in stock. It is a process of selling and shipping products to customers through a third-party supplier or vendor, who will be responsible for taking care of your inventory from storage to shipping, and, in many cases, until after-sales services.
If you are running a typical retail business without dropshipping, your routine will include ordering and storing products, processing, packaging, and shipping customers’ orders all by yourself. However, with dropshipping, when a customer orders a product from your business, you will only pass it to your dropshipper, who will charge you the price of the products sold and additional drop shipping. From this point onwards, the dropshipper will be responsible for the products until shipping and returns. This process is indeed beneficial to any business as it gives the owner the freedom to focus more on other critical areas of the company. There are many options of how you can do drop shipping, and there are significant benefits and drawbacks a business might encounter while implementing some of these options.
To put it simply, dropshipping is the act of selling products to your customer through your website without the need to handle the fulfillment and shipping processes. The business will also not be required to pay for the products ordered until the customer pays for it. All you have to do is to accept and pass orders. It is indeed an attractive business scheme, but many take it for granted and do not research enough to know its consequences. In this write-up, we will discuss three of the most interesting and controversial ways to implement a dropshipping business. One should understand what dropshipping model is the right fit for his company, which directly depends on its goals and visions.
Aliexpress for Beginners
It should be a shock for anyone who already aged in this industry if a newbie dropshipping business won’t try Aliexpress for the first time. With more than 100 million products, this massive marketplace was founded and owned by Alibaba, a China-based multinational retail company.
You might be wondering why would Aliexpress let businesses buy their products for retail, and it’s simply because they are also earning a lot from them.
The main reason small businesses tend to dropship first with Aliexpress is the absence of upfront cost or fee, giving you the chance to test products first without committing to huge finances. In addition to this, it is fairly easy to dropship through Aliexpress. It is as simple as procuring products from the site and inputting your customer’s address. Here is the whole process:
- Add the products you want to sell from Aliexpress to your online store or website.
- Once added, you will now have to do the pricing. You should add a mark-up to the prices in Aliexpress.
- Market your products to your audience.
- Orders will be received and paid by the customers.
- Pay for the products at wholesale prices
- The Aliexpress seller will be responsible for shipping the order directly to the customer.
At the end of the day, you gained profits with only minimum hassles. It is also easier to test products with Aliexpress. It will let you validate your product ideas by listing products in small quantities in your online store and see if it works. If it turned out to be unprofitable, you have the chance always to remove it and start exploring other products. However, that’s not the entire picture. There are also many drawbacks when it comes to dropshipping in Aliexpress, and the biggest disadvantage is the lack of control over the suppliers, fulfillment, and delivery. Your business’s name solely depends on them. Another major disadvantage is the pricing. Many Aliexpress suppliers only source their products to massive warehouses. In this set-up, the product you are sourcing is already priced with a mark-up, so you will not receive the whole profit.
Start Finding a Dropshipping Agent When You Reached 30 Orders
Once your online business stabilized and you’ve already gained loyal and consistent customers, you should now try to focus on finding a dropshipping agent. Hiring an agent will significantly increase your brand’s worth by implementing faster and more reliable shipping services, more efficient product sourcing, better customer service, quality, and a warehousing program. A dropshipping agent often implements a Minimum Order Policy, which usually starts at 30 to 50 orders, although some agents do not have any order policy. It is also negotiable, so if you have proper communication skills, dealing hiring an agent even before reaching their MOP is possible. Finding an agent is becoming more tricky nowadays. If you notice when joining a Facebook group, plenty of individuals will plague your private messages and tell you they are agents and can be relied upon.
You should be careful in dealing and partnering with these people since it is easy to take advantage of people, especially online. Proper diligence will come a long way, even in business. Being cautious and skeptical about the things you incorporate into your business is vital to protect your interests. As a business owner, you shouldn’t let fraud, precisely money scams, get in the way of the company to progress. Here are the things to do before and after partnering with an agent:
Every successful business story starts with in-depth research. It would be best if you researched until you found the agent that suits your needs best. In most cases, the reliable ones should have a global reach, multiple warehouses, and several dropshipping solutions. Once you’ve decided on the products that you would like to sell, research which dropshipping suppliers suit your needs well. Your product niche will also dictate which agent will match your business. For example, you want to sell kitchen products, your agent should be at least familiar with the process of storing and handling this kind of inventory. Many agents have specializations. Choosing and pinpointing if they can serve you efficiently is quite tricky, but it can be effectively done by talking to some of their partners for better references since they are the ones who already experienced dealing with the agents firsthand.
- Order Samples from the Suppliers
Once you’ve partnered with an agent, the next step would be finding a reliable supplier. With Dropship China Pro, you’ll get access to thousands of high-standard verified suppliers from different industries and millions of products at reasonable prices, factory audits, production capacity & time verification.
As a business, you should determine which supplier can give you quality products at low prices. You can compare and contrast products by ordering samples and testing their durability, conditions, and features. You can order from at least three suppliers with the same products. Keep in mind that hiring a supplier might require building a relationship that may last for months and years.
- Order Samples From the Competition
You should know exactly what your competitors offer before dealing with an agent and a supplier. The packaging style, the quality of their products, the quality of service they render, and after-sales negotiations should all be considered. If you have the same product and supplier as your competitor, you might want to have a deal with your agent to change your packaging, or you might change your supplier. Either way, your products should always stand out. This is exactly why ordering sample products from your competitor is a great step in benchmarking the samples.
- Choose the Right Supplier for Your Business
After looking at the company reviews, you should also dig into their business and find if they suit your audience. Factors like the raw materials they use, the way they do business, or how fast are their shipping terms are the modifiers of a good supplier. You can always communicate with your agent regarding each supplier’s performance since they are the ones who know them.
Your chosen agent should have flexible shipping options to meet your product’s attributes. Commonly, agents have product limitations, but due to Dropship China Pro’s connections and universal warehousing, it always its clients to dropship any product they like. Your winning product could be batteries, electronic products, cosmetics, liquid products, magnetic products, knives, and other common “hard-to-ship” products are all available if you partner with us.
When you’re selecting suppliers, many can seem great when you look at their reviews and the products they offer, but they may not suit your audience once you dig into the business. This could be because of the raw materials they use, how they do business, or how they deal with returns. Be sure to talk to suppliers and know how they do business before you commit to working with them. Although you can choose not to use a supplier after issues arise, the damage might have already been done and your brand could have been harmed.
Here is the ultimate Aliexpress dropshipping guide: https://bit.ly/3sqgyTS
Hire an Agent With Fulfillment Center Across the Globe If Your Reach 100 orders
Agents can be individuals or multinational companies, and as time passes, agents are becoming more common. However, one should always keep in mind the not all agents have fulfillment centers. Some agents may have a fulfillment center but are not organized and not spacious enough to accommodate all your orders. Fulfillment centers are in some way the same as warehouses but with extra services. Aside from the building itself, a fulfillment center will be responsible for receiving, handling, repackaging, and shipping your products.
Dropship China Pro has overseas warehousing services that allow you to ship products all over the world in just a tiny amount of time. Fast shipping time will let your inventory be replenished efficiently to ensure that you always have adequate stocks even through unforeseen mishaps.
An average online retail business owner will have to juggle product sourcing, customer inquiries, bad product reviews, etc. If the business is still in its early stages, it may seem feasible, but it will eventually be counter-productive once it grows. This will lead owners to overlook the other critical parts of the business, like marketing and gaining new clients. Smart business owners look for order fulfillment companies to partner with to relieve them from these stressors. If you are still having doubts about outsourcing order fulfillment, here are the comparisons of a warehouse and a fulfillment center:
- Storage Time
Fulfillment centers can act in a similar capacity to a warehouse, but not vice versa. Since fulfillment centers tend to move products through time, it produces faster inventory turnover, resulting to shorter storage time. A center’s goal is to deliver products to customer as fast as possible, unlike warehouses that only aim to store products.
Warehouses only handle the storage of inventories, while fulfillment centers will be the ones responsible for all the stages of order fulfillment. A fulfillment center’s operations are undoubtedly more complex and in constant motion from order fulfillment, negotiating a rate with couriers, answering customer requests and inquiries.
- Shipping Carriers
One of the most important aspects of smooth shipping services is the shipping carriers themselves. Fulfillment centers are known to have strong relationships with several reliable shipping companies. This will lessen accidents such as product breakages throughout the shipping process. There will also lesser incidence of delivering the wrong products, as it often occurs with many companies.
As stated earlier, although they possess some qualities and are often used interchangeably, there are indeed a lot of differences when it comes to their services.
Simply put, the role of a warehouse is merely to store inventory. At the same time, a fulfillment center is designed to enhance the quality of a particular dropshipping business’s services that will eventually lead to better customer experiences.
Knowing when to use Aliexpress, an agent and a fulfillment center is beneficial to any dropshipping business. Fortunately, Dropship China Pro is a reliable agent that has strategically-located fulfillment centers around the world. We have the expertise to handle more than 200,000 orders per day, and we are more than ready to accommodate your business anytime soon. Let us help each other improve your business to build better branding and produce significantly larger profits. You can visit us at https://dropshipchinapro.com/ for more info. Follow our Social Media accounts for tips and tricks.