Drop Ship Companies
and Why You Need Them
Drop Ship Companies (and the people who work for them) will become your best friends if you know what's good for you. If you want to build an ecommerce site, you will need profits to survive and thrive. A Drop Ship arrangement carries literally no expense or overhead, but carries the potential to make lots of passive income. This is ecommerce working at its best!
Drop shipping is a system by which you contact certain manufacturers and set up an arrangement with them to sell their products. When drop shipping, the one with the business set up to sell (you), carries no inventory. When you sell one of the products on your website, you simply call or email the drop ship company, and their go-to person packs and ships the product from their warehouse. The drop ship company will then email (or mail) the receipt only to you.
Drop Ship Companies vs. Fulfillment Houses
Drop shipping means you have an agreement with the manufacturer. The agreement states that you will advertise the manufacturer's product on your website, and you will pay the manufacturer a slightly higher price (around $5 per item sold) than you would if you bought from them at a wholesale rate.
When buying wholesale, you are buying in bulk from the manufacturer, so you will most likely be able to get a better price on the products you are purchasing. Sometimes manufacturers only offer Wholesale pricing because they do not want the hassle of shipping one product out at a time. For that reason it can sometimes be challenging to find suitable manufacturers that offer the drop ship option.
Our advice is to find the manufacturer whose products you love, get them to know and like you (through your personable communication skills) and convince them that setting up a drop ship account with you would be a win-win situation.
Here's why:
Manufacturers that offer a drop ship arrangement do not require you to stock their inventory. Even though you pay $5 on average more per item, you save considerably more by drop shipping than buying in bulk. If you bought wholesale you would either have to store lots of products at your home (if you have a spare empty basement-this could work for you), or you would have to have all you products shipped to an independent Fulfillment House which will handle all your orders.
As convenient as a Fulfillment House is, they are expensive. A Fulfillment House can be a great option when your business begins to grow. These companies can offer much more than drop ship companies.
They can add a personal touch if you would like to have the packer throw in some promotional material for your business. The Fulfillment House can also do specialized gift wrapping if you have an online gift store. If you do feel like this kind of company is a good option for you, check out this page on Choosing the right Fulfillment House for some valuable tips.
But, again, we urge you to start out by not having the Fulfillment House expense. If you need help building a website that is equipped with ecommerce, you are at the right place. Just use this link to take you to the Web Site Building Guide. There are many packages there which will offer relief. It is almost impossible to do this alone-get help building your website with ecommerce by clicking here.
There are many wonderful manufacturers that offer drop ship arrangements that Mark and I have worked with professionally. We will supply you with a few which we will recommend for different reasons. Here's our personal best:
Bangkok Imports
Contact info:
245 W. Broadway Ste. 270A
Long Beach, CA 90802
877.485.1153
Email: info@bangkokimports.com ...Sadly Bangkok Imports filed for bankruptcy early 2009 - I will leave this up in case they make a come-back!
This is one of the classiest manufacturers that we have worked with. They make beautiful products for the home. Located in Southern California, they can provide you with wonderful pictures from their gorgeous cataloges. The staff is extremely helpful. One note on this company is that they did not initially allow me to set up a drop shipping account with them. I had to appeal to the contact person.
One of the best pieces of advice I can give anyone that needs help building a website for their online store is to create friendly working relationships. Present your case with a positive and respectful tone to the drop ship companies that you want to work with. Compliment and sympathize with their position. Many times you will be surprised that certain wholesale-only companies will bend to your desires, and become drop ship companies. And if they don't, thank them, and move on.
China Star
Contact info:
3048 SW High Desert Dr
Suite R Prineville, OR 97754
800.653.9888
China Star is one of the largest manufacturers we have worked with. They have thousand of products and gift items with an Asian flair - everything from furniture to jewelry. The cataloges they offer are not as beautiful as the ones from Bangkok Imports, but if you would like better hi-resolution pictures that you can make images from to put on your site, they will send you a CD.
Again be friendly to these folks. When an order comes in they will be in charge of packing up and shipping out your product to your customer in a timely fashion. Do not give them any reason to "forget" to ship your order. Be nice, and the drop ship companies will be nice to you-and your customer.
Kheopps International
Contact info:
Kheops International
PO BOX 177
Colebrook ,New Hampshire 03576
800 215 8705
This east-coast company is similar to China Star. They are huge, and just recently started becoming one of our drop ship companies. In my opinion the quality is not quite as high as China Star for these types of products. But, then again, I have seen more products up close from China Star.
We would always recommend getting samples of the products you are going to be selling on your site. Only sell products that are well made and worth what you are charging. Besides seeing what these products look like in person, you will be able to take better pictures, so that they will be displayed on your website in a more pleasing way.
Some of these drop ship companies will actually give samples of your products. Most do not, but always ask - they might surprise you!
Harmony in Design
Contact info:
James Lester
Harmony In Design
PO Box 248
Crestone, Co
81131
phone: 719.256.6023
email: harmonyindesign@fairpoint.net
This one of the couple of family owned drop ship companies I stumbled upon, and wound up working with. They offer many green and organic products-furniture, and yoga and pilates equipment, and a couple of other specialty items. I love the products this company offers for drop shipping, but their drop shipping prices are somewhat higher than in other drop ship companies, so it is difficult to find products that have a decent profit margin.
Still, if you have a niche store, specializing in these types of organic products you can do well. Sell a lot and you will make good money.
Native Remedies
Contact info: 1-877-289-1235
I love this company. They specialize in natural remedies that help people with everything from sleep disorders to the chronically overweight. They have a wonderful drop shipping program which makes it easy to sell their products on your website. They also offer training on how to sell, and they offer affiliate programs if you prefer to sell their remedies as an affiliate. This is one of those drop ship companies that has it all - great customer support, products with a guarantee, and a super-friendly staff.
Bean Products
Contact info:
Chuck Blumenthal
Bean Products, Inc.
1500 S. Western Ave, 4bn
Chicago, IL 60608
312.666.3600 ph. 312.666.3629 fax
email:info@beanproducts.com
I have the exact same comments about the drop shipping experience with Bean as I do with Harmony in Design. They offer great products, but not much profit margin. They are one of the other family-owned drop ship companies that we work with.
Netmalls
Contact info: Email Tony at www.net2mallsdropship.com
This is another very big company which offers a wide variety of everyday items-from dog houses to exercise equipment. They have good everyday products to round out our store. Profits margins are so-so. I am the least familiar with the drop shipping standards of this company than any other I have listed. I like the variety of products they offer, but I have not had any interaction with their customer support. There are many drop ship companies out there that are hard to get a handle on-this is one of them. But, that does not mean that they would not be a good fit for you.
Woodstock Chimes
Contact info:
email: woodstock@chimes.com
Woodstock Chimes
167 DuBois Road
Shokan, NY 12481-5124
845-657-6000
800-422-4463
Woodstock Chimes is based in New York. They have been around a long time and they have many products that I love-products that they guarantee on all their products! Again, this is one of the better drop ship companies out there. I give them 10 out of 10 stars. They have chimes, of course, which are their specialty. They also have some fountains, and singing bowls. I like the drop shipping program they have. Profits margins are generally very good-50%, which is about as good as you are going to find anywhere for drop shipping.
Seek and Find More
Drop Ship Companies
This list is our personal best. Of course, your online business may need other drop ship companies to choose from to find just the right products for your particular niche. And even if you offer products with an Asian flair or organic and green products, we urge you to find drop ship companies you like-ones that resonate with you. Try some from this list, but experiment with your own.
Here are a couple more things you can do to find the right drop ship companies for your website:
Gift Shows
We had a lot of fun going to our state manufacturers gift shows. We highly recommend you attend the closest one in your area. When we were looking for gifts for our online store, A Zen Gift, we went to the LA gift show, and it was nothing short of amazing. There were hundreds and hundreds of vendors (drop ship companies) displaying their products.
Whether your online store sells electronics or baby sleep aids or imitation grass-you will find what your are looking for-just don't forget your credit card. Many times great deals are offered by manufacturers if you purchase at the gift show. Some manufacturers will offer drop shipping, some will only allow you to buy wholesale (buying in bulk). To find your closest Gift Show just Google "your state" gift show, and go from there.
Online Supplier of Wholesale/Drop Shipping Companies
There is a fee (about $400) to join these online wholesale / drop ship companies. But, believe us, it is well worth it. We use WorldWide Brands.
There are others, like TradeKey, but we have used WorldWide Brands exclusively for over 5 years now. The gift shows are great, but sometimes it is not convenient to attend these events. Companies like WorldWide Brands offer thousands of drop ship companies at your fingertips. It is easy to use, and you will find products in every conceivable niche-for drop shipping and wholesale.
Have Fun and Be Nice to
Your Drop Ship Companies
Getting your online store set up with the appropriate products and/or gifts is time consuming, but it can be a lot of fun. And if you have great arrangements with your drop ship companies, it doesn't cost a dime. If, on the other hand, you buy wholesale, you save a little by buying in bulk, but your costs can add up quickly when you start buying 10 or 20 of all the different products you want, and then ship them to your fulfillment house.
So, be smart, and take it slow. Try drop shipping. Develop a friendly relationship with the drop ship companies you are dealing with. Give great customer service on your end, too. Just because you are setting up a passive income business, you must take care of those people that found your store and purchased something from you.
Make your customers realize that they made a good choice. They will return, and they will tell their friends. Word of mouth is a wonderful thing-the most affordable online marketing on the planet! Spread the love-from your drop ship companies to your customers, and passive income will flow naturally into your life.
A Closing Tip...
One important thing to be aware of is where the drop ship companies are located. When an order is placed it is a good idea to know how long a distance it is from the manufacturer to your customer. Do not be shy with the company you wind up working with. Contact them after the sale, and ask them to email you the tracking number so that you can pass it on to your customer.
If you are thinking of growing your buisness and are looking for some ideas. Check out the Best Online Business Ideas page.
Looking for more money to start or grow your Business? Go to the Money for Starting a Business Page.
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