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Most so-called dropshippers are not real wholesale dropshippers.
Most are a "middle-man" that advertises themselves as a dropshipper but they fall very short of what a real wholesale dropshipper is supposed to be. A middle-man, also known as an MLM (multi-level marketer), will not be able to offer the products they dropship at true wholesale prices unless the fake dropshipper charges subcription fees or membership fees to access their products. If a fake dropshipper does not charge subscription or membership fees, then you will find that the fake dropshipper does not offer true wholesale prices. Think about it. If a dropshipper is a real wholesale dropshipper, then the dropship company gains its profit from selling wholesale products because a real wholesale dropshipper is a true wholesaler that will buy products in very large quantities directly from manufacturers at prices lower than true wholesale. A real wholesale dropshipper will then sell/distribute its products at true wholesale prices to retailers. The markup between the product's manufacturer price and the wholesale price is the profit margin required to keep a wholesale dropshipper profitably in business.
Fake drop shippers are easy to spot.
A fake drop shipper will usually charge subscription/membership fees or a fake dropshipper will charge prices far above true wholesale prices or a fake drop shipper will charge high prices and subscription/membership/access fees. A real wholesale drop ship company will be a "free" wholesale dropshipper that allows the retailer to sell the product before the retail merchant must pay anything to the wholesale drop shipper and a real wholesale drop shipper sells products at true wholesale prices. If you want to have the best chance of making appreciable profits you should always question a prospective drop supplier to determine if they are a real wholesale drop ship company. In summary:
A real wholesale drop shipper
Will not charge for access or charge subscription/membership fees.
Will charge a true wholesale price for a wholesale product.
A fake wholesale drop shipper
Will charge membership/subscription/access fees, or
Will charge prices considerably higher than true wholesale, or
Will charge membership/subscription/access fees and prices much higher than true wholesale.
How to identify a real wholesale dropshipper:
A real wholesale dropshipper is first and foremost a wholesale distributor. A real dropshipper is a wholesale distributor that offers the added service of dropshipping single wholesale items anonymously to retail customers on behalf of the retail merchant. Not all wholesale distributors are dropshippers, in fact very few are dropshippers, but a real dropshipper is always a wholesale distributor.
Since a real wholesale dropshipper is a wholesale distributor, a real wholesale dropshipper buys product in very large quantities as a wholesale distributor does. By large quantities we mean spending tens and hundreds of thousands of dollars on each product line the real dropshipper stocks. Most of the time a real wholesale dropshipper, just like a wholesale distributor, is an importer that buys directly from factories and manufacturers. A real dropshipper buys product below wholesale prices since the real dropshipper buys in huge quantities directly from manufacturers. Manufacturers will not sell in small quantities. A real wholesale dropshipper will offer a real wholesale price because the real dropshipper buys in huge quantities directly from manufacturers and can offer true wholesale prices while maintaining a positive profit margin. Fake dropshippers have to charge subscription/membership/access fees or chrage prices much higher than true wholesale since they are buying from wholesale distributors or are using real dropshipper themselves. A fake dropshipper is not a real wholesale dropshipper and a fake dropshipper is an unnecessary "middle-company" that takes your profits!
Real wholesale drop ship distributors buy in huge quantities, thus a real drop shipping company needs warehouse space and material handling equipment to receive, store and ship products. Even a small drop ship distributor may have millions of dollars worth of infrastructure from forklifts and storage racks to web servers and invetory control software that facilitate business operations and facilitate efficient performance as a wholesale drop ship supplier. A fake drop shipper likely will not have a comparable infrastructure or any infrastructure at all. Fake drop shippers often do not inventory the items they offer and thus a fake drop ship company may need to cancel your purchase order since the product inventory is not theirs and they have no idea what is available until the fake drop shipper's supplier (the real wholesale drop ship distributor) tells them the item is out of stock.
A real wholesale drop shipping company will increase your probability for success.
Real wholesale drop shippers sell their products at true wholesale prices, thus using a real wholesale dropshipper will result in better profit margins on the wholesale items you purchase. Real wholesale dropshippers have direct control of their wholesale inventory because they warehouse their wholesale products.
Do your homework before you commit to marketing and selling a wholesale drop ship company's products. Ask lots of questions. Ask a prospective drop ship supplier if they store their own products, ask where the drop shipper's warehouse is located then ask if you can visit their warehouse. If you can you should visit your drop shipper's facilities.
Another great way to evaluate a prospective drop ship supplier is to ask other people who have worked with the drop ship company. Go to your favorite search engine and perform a search for "drop ship discussion group", "drop ship message board" or "drop ship thread". Another good source for unbiased information is http://groups.ebay.com/index.jspa , Ebay's discussion groups. Visit the link and perform a search for "drop ship", "dropship" or "drop shipping". With any luck you will be able to find a reliable and independent opinion of your prospective drop shipper. Always do the research and make your decision an informed decision.
Category: DropshippingChoose Your Dropshipper Carefully! was written by:Author:Jason SanchezAdded: Thu, 15 Feb 2007 02:30:56 -0500 This Article Has Been Read 1228 times View all Jason Sanchez's articlesAbout the Author: * Jason Sanchez is the founder and CEO of One Net Enterprises, Inc. (wholesale dropshipper). He developed ONEinc as a wholesale distribution company that focuses exclusively on drop shipping services for small to medium internet based retailers. He handles all product sourcing and importation as well as ONEinc's strategic development. He can be contacted through |
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