In order for anyone to start an ecommerce business, all that's needed is a computer, a website, a marketing plan and products. That sounds easy, but it's easier said that done, if it is done right. There are hundreds of people listed on the Internet that are in the dropshipping wholesale business. Some of them are legitimate dropshipping wholesale companies and others are what's know as middlemen who act like real dropshipping wholesale companies, but are shells that take profits away from the retail dropshippers who buy from them.
A middleman is sometimes hard to identify. They look and act like a real dropshipping wholesale company, but actually they buy from one at wholesale prices and then add a profit to that price and sell the product to the retail dropshipper. Most of the time the retailer can not make a profit because the competition is buying the product directly from the real dropshipping wholesale company.
There are several ways to identify these middlemen. They usually want a monthly fee as well as an initial fee before the retailer can buy from them. They offer newsletters and catalogs for the monthly fee, but that information is available other places for free. What would anyone want to pay a monthly fee when they are purchasing products on a daily, weekly or monthly basis? These middlemen are not listed with online sources that has a list of all reputable dropshipping wholesale companies in the US and Canada. By doing a little research, a retail dropshipper can quickly identify middlemen and then get away from them as quickly as possible.
There is a great deal of competition on the Internet and price is always an important factor in closing any sale. Middlemen make it difficult for retailers to compete not only from a price point, but delivery could be an issue as well. With so many dropshipping wholesale companies in the marketplace, it makes sense to do the research and find one that suits all your business needs.
Some retail dropshippers want to go directly to manufacturers or manufacturer's representatives and buy directly from them. That's a good idea if you have one product or more than one that is made by the same manufacturer. But if your product line is diverse and you have several different categories like shoes, jewelry, electronic and others, it may be better to use a dropshipping wholesale company. There are several advantages; you deal with one website and are invoiced the same way. They negotiate and communicate with the manufacturer about prices, deliveries and other issues on a daily basis. A wholesale dropship earns their initial fee as well as the profit they make from each sale.
The retail dropshipper should focus on the front door of the business which is sales, marketing, advertising, promotions and service. The retailer needs to continuously update the website, send out emails and network daily. Trying to perform the back door duties of the wholesale dropshiper is a dangerous venture without the retailer can afford to pay someone else to do it for him. That cost however, would be more than what the dropshipping wholesaler charges.
There are many things to think about in the retail dropshipping business. Where to sell products is always a challenge. eBay certainly is the place that gets traffic, and should be considered a place to do business. eBay helps a lot of businesses sell product, but there are other sites to consider as well. A business website along with a blog can help produce traffic. Networking and affiliate programs also increase traffic to the retail sites. Word of mouth and sharing a website with a business friend is also an option. Social networks are great places to build traffic. Facebook is just one of hundreds of social networks that have come online in the last two years.
Whatever the retail strategy is to build traffic and customers, the drop ship wholesaler can assist in that process as well. A good company has lots of information to share about buying trends and consumer habits. They have statistics available that help analyze purchases and they can forecast future market changes. A dropshipping wholesale company is a true partner and will work to increase the retailer's business in any way possible. It is the natural thing to do. It helps his bottom line and expansion goals.
So even though the only things needed to start an ecommerce business are a computer, a website, a marketing plan and a product, the main ingredient in any successful business is the people. It takes a partnership to start a successful dropshipping wholesale business; a partnership that includes the retailer, the wholesaler and most of all the consumer. Each one performs a service that makes the business profitable.