5 Dropshipping Mistakes that will Kill Your Business

dropship mistakes

Dropshipping can be a great way to make some money, but never forget, if something goes wrong it’s YOUR reputation on the line, no the drop shipping company. Be honest with your buyers and suppliers and don’t over-promise. Avoid these mistakes and you will be on your way to becoming a successful dropshipper.

  • Have a good relationship with your dropship supplier. (Your smooth sales are your reputation)
  • Do everything you can to ensure no stock outs of your sale items.
  • Unless you are taking advantage of extra services, avoid “middleman” dropshippers
  • Join and use a wholesale dropshipper listing directory service.
  • As volume permits, try to dropship from the manufacturer.

There are many dropshipping mistakes that you must be aware of as you start or expand your online business with a wholesale dropshipper. The first thing to remember is that it is your reputation and not the dropshipper’s that is being seen by your customers. If you do not have a good relationship with your supplier, you open yourself up to losing business from your customers, especially repeat business which is going to be the lifeblood of any Internet retailing endeavor.

Even the best wholesaler will have situations of stock. To avoid this dropshipper pitfall, you need to do the extra work of checking the stock availability of any items you are selling. If you are using eBay as your selling point, this stock out problem can be intensified. When you put up your dropshipped item up for bid, there is a time factor until the item bidding is closed. Add to that the time it takes for your purchaser to get the money to you and you are setup for this stock out dropshipper pitfall. If you are selling through your own website, you will want to check almost daily for the stocking levels so that you do not lose your customer due to this dropshipper pitfall.

It has been argued that using a supplier can cut into your profit margin and you are better off getting your product from a manufacturer directly. If you have found a niche that you can consistently sell to and can absorb the costs of storage and handling, then you might be able to avoid the added costs of a dropshipper by going to a light bulk or bulk purchasing situation to keep your stock supply. However, dropshipping is the easiest and usually the most economical way to start. After all we are (none of us) a Wal-Mart that can get huge discounts from manufacturers by getting large shipments at once.

As you set up your Internet retailing business, try to avoid the next dropship pitfall. Set yourself up with a wholesaler, not just a middleman. What we mean by that is there are many “middleman” dropshippers that dropship for you from wholesaler. They, of course, take a cut of the money for their service. This would not be a problem for you if you use dropshippers such as DropshipDesign, Shopster, or even Wholesale-Portal offer other services such as training or online store hosting beyond the dropship service itself. The best known of these dropshippers is Doba. This may not be a mistake for you if you will be using these added services. Evaluate what is offered by these services and decide for yourself if the lower profit margin is really a dropshipper pitfall for you.

Avoiding the “middleman” pitfall can leave you with the problem of locating a wholesaler. This is easily (although usually not free) taken care of by using a dropshipper list directory service. These websites such as World Wide Brands organize wholesale dropshippers by various categories and help you search out a wholesaler for the items you are interested. You then can setup your contacts and get accepted by the dropshipper for doing business. Another good site for a list directory is Hienote Inc. They work to keep up with the merchandise trends and try to find the best wholesale dropshipping sources. And, of course, there is Doba known for its eBay connections. Although these sites require a payment to join, it is well worth the signup fee to avoid this dropshipper pitfall.

If we think of a wholesale dropshipper as a distributor, remember that if you find an item that is selling well for you, you should see if the manufacturer will ship for you directly. If the item is selling very well, you might even want to go the light bulk delivery route and begin stocking the item yourself thus saving even more costs. This solution (if it is viable for you) later in your Internet retailing business avoids dropshipping altogether.

These are just a few of the possible problems that should not out-weigh the benefits of wholesale dropshipping service. Just keep them in mind and try to avoid these pitfalls.

 

DISCLOSURE: I am an affiliate for some products that I recommend. If you purchase those items through my links I may earn a commission.