The Truth About Dropshipping

Having a supplier drop ship your products can be a very efficient way to save time and money. However, this does not come without other costs that may affect repeat sales.

The major factor you must consider after product quality and availability is to insure that the supplier ships your product in a timely manner. Sorry, 2-3 days is not good enough! Skip this and you will lose money and customers.

Consumers are still making the transition from buying in brick and mortar stores to purchasing products on the Internet. They are used to getting their products immediately and they expect much the same when they make a purchase on online.

If your supplier cannot ship your product at least the next day after payment or even the same day, they are doing you and your customer a disservice, and it will cost you many repeat sales.

Same or next day shipping is not that hard to do. In all my businesses from day one, I have always insisted that all orders be shipped the same or next day after payment.

Twenty years ago this was unheard of and businesses that embraced this strategy gained a very important strategic advantage over their competitors. Today, same and next day shipping is the norm for any successful company.

It’s all about the customer, making them happy, giving them more than they expect and treating them with respect. Treat your customers as you would like to be treated.

The best way to see if a shipper lives up to its written shipping policy is to place a order and have it sent to your address.  Place the order as a regular customer would and observe the process carefully.

Most packages using any of the major carriers including the U.S. Postal Service will take a week to arrive after it has been shipped, unless the product is shipped priority mail which should be received anywhere in the U.S. in 1-3 days.

Also, be very aware of what the shipper is charging for shipping the product excluding the standard drop ship fee, if any.

When your package arrives weigh it and check the rate you were charged with the actual cost of the service used to ship the product.  You will only be able to come up with a ball park figure as many large companies negotiate discounts with common carriers, especially UPS.

But if the actual cost you were charged matches the rate you found at the consumer level, then I would say its close enough. If it is much more, then you are being cheated and the drop shipper is padding his profits with the shipping charges.

 The best approach to a situation like this is to just ask the shipper why they are charging more than the actual shipping costs. If the supplier is not charging a drop shipping fee than the additional costs may be acceptable, as some suppliers may need to recover the cost of packaging which can be considerable. 

Do not confuse this with a handling fee used in association with retail purchases. When you have your products drop shipped, the standard drop ship fee (usually about $1.00 to $5.00) would be considered your handling fee.

Other than that, I would not deal with a supplier that pads the shipping cost. To me, it’s just unacceptable, and if the supplier needs to recover some costs it should be reflected in the drop shipping fee.