So what exactly is drop shipping? I found the most clear definition of drop shipping at Wikipedia, the free encyclopedia. "Drop shipment or [drop shipping] is a type of retailing where the retailer does not keep goods in stock, but instead passes the customer's order and shipment details to the wholesaler, who then dispatches the goods to the customer directly. The retailer makes their profit on the difference between the wholesale and retail price.
Some retailers may still keep "show" items on display in stores, so that customers can inspect an item similar to those that they can purchase. Other retailers may only provide a catalogue or Internet presence. Drop shipping can occur when a retailer (who typically sells in small quantities to the general public) receives a single large order for a product. Rather than route the shipment through the retail store, the retailer will arrange for the goods to be shipped directly to the purchaser. The book selling industry provides an example.
Book retailers typically sell single copies of books to the general public. But a store may receive an order for, say, 50 copies of a book from a company that wishes to buy the books for their employees, clients, or stockholders. The book retailer will arrange for the wholesaler to deliver the books directly to the company.
Many sellers on eBay also drop ship. Typically a seller will bid an item as new and ship the item directly from the wholesaler to the highest bidder. The seller profits from the difference between the winning bid and the wholesale price, minus any selling fees from eBay.Yet another version of drop shipping is the practice of using
private freight carriers to transport large volume items direct from the manufacturer to a postal facility close to the location of the end recipients (as opposed to dropping the items at a postal facility close to the manufacturer). This practice is employed for purposes of postal and time savings. An example is a magazine
publisher trucking all magazines addressed to subscribers in Miami directly to the post office in Miami.
NOTE: Dropshipping companies do not always offer wholesale prices. In order to determine whether a dropshipper is a legitimate wholesale supplier, pay close attention to the following: 1)Are prices already displayed to the public? -- Genuine wholesale prices are never shown to the public. 2)Is a membership fee required? -- Most authentic wholesale dropshippers will never require membership fees; those that do offer a full refund after a certain number of inventory purchases are made."
Dangers of Dropshipping
Drop shipping can potentially ofeer you an opportunity to make money online."While it is true that the profits can be immense, the seller effectively has to rely on the goodwill and professionalism of the dropshipper (which is, more often than not, a company that the seller knows only through the Internet). Ultimately, one should always keep in mind that should the deal go raw (for instance, the dropshipper supplying a faulty product or a downright incorrect one), it will be the seller's reputation that will take hit. The end buyer cares nothing for whether the seller used a dropshipper or not; all they truly care about is receiving the product that they paid for. For that reason, dealing with unverified dropshippers can be dangerous. Another complication involved in using dropshippers lies in the fact that reliable dropshippers already have many sellers working with them. Therefore, someone just looking to get involved in selling dropshipped products is likely to discover that there are already thousands of people out there, selling the same product and seeking to capitalise on below-retail prices offered by the dropshipper. What this means for everyone else involved is that the competition will drive the price of the product down, thus reducing the profit margins that one would hope to gain by using a dropshipper in the first place." So the most important point to note is that for you to pursue a viable drop shipping business which will enable you to make money online, you need to do your home work and properly for that matter before plunging into the competitive world of drop shipping and indeed any business that offers you an opportunity to make money online. Otherwise you will end up burning your fingers.
Nyasani Gitaa has authored many articles which have been widely published on many websites and article directories across the internet. Read more about this and other exciting and informative articles by visiting his site at [http://www.mwagitaa.com]
Some retailers may still keep "show" items on display in stores, so that customers can inspect an item similar to those that they can purchase. Other retailers may only provide a catalogue or Internet presence. Drop shipping can occur when a retailer (who typically sells in small quantities to the general public) receives a single large order for a product. Rather than route the shipment through the retail store, the retailer will arrange for the goods to be shipped directly to the purchaser. The book selling industry provides an example.
Book retailers typically sell single copies of books to the general public. But a store may receive an order for, say, 50 copies of a book from a company that wishes to buy the books for their employees, clients, or stockholders. The book retailer will arrange for the wholesaler to deliver the books directly to the company.
Many sellers on eBay also drop ship. Typically a seller will bid an item as new and ship the item directly from the wholesaler to the highest bidder. The seller profits from the difference between the winning bid and the wholesale price, minus any selling fees from eBay.Yet another version of drop shipping is the practice of using
private freight carriers to transport large volume items direct from the manufacturer to a postal facility close to the location of the end recipients (as opposed to dropping the items at a postal facility close to the manufacturer). This practice is employed for purposes of postal and time savings. An example is a magazine
publisher trucking all magazines addressed to subscribers in Miami directly to the post office in Miami.
NOTE: Dropshipping companies do not always offer wholesale prices. In order to determine whether a dropshipper is a legitimate wholesale supplier, pay close attention to the following: 1)Are prices already displayed to the public? -- Genuine wholesale prices are never shown to the public. 2)Is a membership fee required? -- Most authentic wholesale dropshippers will never require membership fees; those that do offer a full refund after a certain number of inventory purchases are made."
Dangers of Dropshipping
Drop shipping can potentially ofeer you an opportunity to make money online."While it is true that the profits can be immense, the seller effectively has to rely on the goodwill and professionalism of the dropshipper (which is, more often than not, a company that the seller knows only through the Internet). Ultimately, one should always keep in mind that should the deal go raw (for instance, the dropshipper supplying a faulty product or a downright incorrect one), it will be the seller's reputation that will take hit. The end buyer cares nothing for whether the seller used a dropshipper or not; all they truly care about is receiving the product that they paid for. For that reason, dealing with unverified dropshippers can be dangerous. Another complication involved in using dropshippers lies in the fact that reliable dropshippers already have many sellers working with them. Therefore, someone just looking to get involved in selling dropshipped products is likely to discover that there are already thousands of people out there, selling the same product and seeking to capitalise on below-retail prices offered by the dropshipper. What this means for everyone else involved is that the competition will drive the price of the product down, thus reducing the profit margins that one would hope to gain by using a dropshipper in the first place." So the most important point to note is that for you to pursue a viable drop shipping business which will enable you to make money online, you need to do your home work and properly for that matter before plunging into the competitive world of drop shipping and indeed any business that offers you an opportunity to make money online. Otherwise you will end up burning your fingers.
Nyasani Gitaa has authored many articles which have been widely published on many websites and article directories across the internet. Read more about this and other exciting and informative articles by visiting his site at [http://www.mwagitaa.com]
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