Newbie seeking advice on drop shipping

Free Member
nylife22
Posts: 1
Joined: 11 Mar 10
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30 Nov 09 08:34:45 am
I am new to this but I am willing to put the effort in to make profit. I am just wondering if it is possible to start out drop shipping first because I do not have a lot of money and I have no room for bulk.

Full Member
dwmgoods35
Posts: 310
Joined: 19 Feb 09
Karma: 
30 Nov 09 04:43:49 pm
Hey nylife22,

Go ahead and PM to PLANES. He runs a great dropship business that I also use and doing pretty good considering I am in a similar position that you are.

Full Member
satya
Posts: 1778
Joined: 02 Jun 09
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30 Nov 09 10:58:16 pm
Hi nylife22,

Welcome to SaleHoo!

Drop shipping is slightly more expensive because you are not benefiting from bulk discounts. It also requires you to pay a small fee on top of the wholesale cost of the product to cover the drop shipper's time spent packaging and posting the item. This additional cost can make significant inroads into your profit margins and it is not always the best way to make money in the LONG TERM.

But that's not to say that drop shipping is a bad idea altogether. Truth is, it's a simple way to start a business, actually, it makes starting a business ALMOST risk-free. It allows you to target small niche markets without the risk of carrying extra inventory and in the long term, having some of your inventory drop shipped allows you to offer a broader range of items to your customers without the risk of holding stock.

You can learn more about drop shipping in our blog and free education area:

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All the best!


Satya
Customer Support
SaleHoo Group Limited
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Free Member
haydee
Posts: 361
Joined: 11 Mar 10
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1 Dec 09 05:07:38 am
Hi nylife22,

Welcome to SaleHoo! It's great to have you here :)

I'd recommend downloading our Dropshipping Guide by clicking on the link on the left-hand side of any SaleHoo page, 'Bonus Guides *New*' for some great dropshippers and helpful tips on dropshipping.

Have you thought about where you will be selling your products? Have you done this before? The best way to gain experience without risking a big capital is by selling stuff from around the house that you no longer need. I'm sure that there are used, slightly used or even brand new items in your closet or in your spare room where you keep all your extra stuff that need a new home. It will not only help you gain experience, it will also help establish your reputation as a seller and help come up with a decent capital for you to buy small lots to resell or buy a couple of items to test your dropshipper.

If you have a look at the links that Satya has provided and if you check out our Bonus Guides, you will understand how this works more.

Dropshipping is workable. The most important thing is avoiding the popular or hot items on eBay's Top Searches as they are usually too competitive for a small seller and sticking to a good niche market with less competition.

Selling stuff from home is good way to find a good niche market. Another way is by doing a Completed Listings Search (by clicking on Advanced Search) on eBay to get the sell-through rate and the average selling price of the item that you intend to sell. Note that for you to make profit, the wholesale price needs to be at least 20% lower than the retail price.

All the best,

Site Admin
irene_salehoo
Posts: 2578
Joined: 21 Mar 10
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1 Oct 10 12:59:03 am
Hi nylife22,

I'd like to share some additional tips about what you should be looking for in choosing a good drop shipper -

1. You will notice in your search that some requires a fee. This is not a sign that they could probably be scammers, as drop shippers need to spend time and effort (manpower) in setting up and maintaining your account. What you need to clarify though is the terms for this drop shipping fee. Is it a one time payment or will you be paying annually? Some offers a rebate as soon as you have reached a particular level of business with them. Again, this is just to enable them to operate cost effectively and avoid wasting time with players who are not serious about drop shipping arrangement.

2. Clarify if they the items listed are in stock or if you need to confirm first before you put them up on sale. This is to avoid committing a sale without any product at all, just because the drop shipper's site is not updated.

3. Confirm details about their payment options. It would be best if they accept Paypal or credit cards.

4. Ask for their shipping policy, if they allow combining orders to ship.

5. Do you prefer blind drops shipping? Most of the drop shippers are willing to put your name on the shipping label and your customers will not have any idea that it was drop shipped.

Hope this helps! :)


Irene
Free Member
enforcrr
Posts: 12
Joined: 04 Aug 10
Karma: 
3 Oct 10 06:22:08 am
dropshipping is also a great way to find what sells good on ebay. If it sells good then buy it in wholesale

Site Admin
irene_salehoo
Posts: 2578
Joined: 21 Mar 10
Karma: 
19 Oct 10 10:53:13 pm
dropshipping is also a great way to find what sells good on ebay. If it sells good then buy it in wholesale


I agree. :) Drop shipping is an excellent way to test the demand for a certain product, and it is also a good method to test a new supplier's reliability, which you can now do without risking with a costly bulk purchase.

Cheers! :)


Irene

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