Middle Men in Drop Ship Businesses

If there was a single thing that I would advise drop ship business retailers to stay away from, it would be middlemen. They operate a number of sophisticated scams that suck the trader in and yet they never seem to get any profit out of the venture. When you are working in the drop ship business, you are essentially the go between the supplier and the consumer. The consumer orders products and then you make a relevant order with the supplier.

Your profits come from the difference between the supplier price and the consumer price. The middleman would be someone who inserts themselves into this relationship by taking a share of that profit. They purport to connect you to the supply when in reality you are quite capable of doing this yourself. What is even more shocking is the fact that the middle men will attempt to charge you a retainer for the privilege of doing drop ship business with them.

Some of these middlemen schemes have been found out to be real scams that have no intention of doing honorable business with you. It is best to just avoid the middlemen. If you do the business on your own you will have the knowledge that all the profits and losses lie with you. You will not be working for someone else.

In any case the profit model with middlemen is not effective at all because you are participating in what is in effect a double charging scheme. I am sure that most consumers would not like to buy products where more than two parties are making a profit. If that is the case and they have the option, they would rather go to the manufacturer direct.

Middlemen can put pressure on you to expand your drop ship business way beyond what you planned and are capable of. The fact that you are giving them a percentage of your profits means that you will have to do volume productions in order to break even. Volume productions in the drop ship business carry the risk of reducing the effectiveness of customer service. Rather than thinking about your customer you will be thinking about the concerns of the middleman.

Most serious manuals do not advocate for the use of middlemen in the drop ship business. They are nothing but a nuisance and unnecessary risk. Avoid them as much as possible and have the confidence to run your own business.

Source by Edward Baldwin