Drop shipping is a convenient and very cost-effective way of doing business on eBay, similar directories, or even on your own website. You can retail a large variety of hot ticket items such as electronic gadgets without keeping or maintaining a single inventory. These functions fall under the role of the wholesalers or the drop shipping distributors and all you have to do is draw in the potential customers to your websites and product listing and make a sale.
While dropshipping makes it easy for people to work out profit margins one matter that is sometimes difficult to take into account is the shipping cost.
This is one essential building block that online sellers like you should clearly work out and identify with your drop shippers particularly if selling items to an international market. It would be a lot easier if you're retailing small gadgets that have little or negligible weight considerations, but this would get more complicated for bigger things such as cell phones or car DVD players.
Shipping costs are customarily determined accurately if you know the weight of your item and the distance from the point of origin to the buyer. However, many drop shippers are hesitant to supply this figures to online retailers as market conditions and constantly changing shipping rates by carriers affect the shipping cost per unit - increasing the danger of providing erroneous information to the customer. However, there is still a way of how you can effectively work your way through this and the following will show you how.
The Various Advantages of Drop Shipping
Previously, there were few dropship companies and most of the companies that did operate did so in countries like the UK and the US. Now, dropship companies exist in the same countries that the products are manufactured.
This is probably the key benefit of using drop shipping suppliers as you can have the merchandises ordered by your customers delivered right to their doorsteps - in your name. This is done without the need for you to keep pricey, and precarious, inventories. All you need is your computer, an internet connection and your own online store in your own website or an ecommerce directory. There is no need to invest heavily as you remunerate your drop shipper after you have been paid by the end client.
The success of your online business will rely heavily on your drop ship supplier's integrity and performance in ensuring that your customers receive the correct items they ordered and in great working conditions as well as being delivered within a reasonable timeframe. Aside from that, you should also work to maintain a good relationship with your supplier so you can avail of further discounts as well as valuable assistance in determining shipping costs to any destination.
Working Out Shipping Costs with These Three Simple Steps
Getting accurate information about shipping costs from your drop ship supplier could be hard to manage at some point but there is a simple system that you can use to get a good approximate and you can do this in three easy steps as described below:
* Set up Your Account
As long as you're working with a free dropship source then it is very easy to set up a second account. The main purpose of doing this is to put in fake addresses to work out the shipping c ost for items.
* Fill Up Your Address Book
Create variations of entries using different product ranges and country destinations using your extra account. Some wholesalers allow you to have over 1500 entries in your address book so this would be more than enough to use with dummy entries as well as you real customer entries. Nevertheless, to avoid complications and potential errors, it would be best to use your second account for all these dummy entries.
* Use Different Address Book Entries to Work out Transport Freight Cost
Use these different entries to gather information of corresponding shipping freight cost for a certain type of product and destination. You can simply change the country or destination for each product giving you a good insight of the current freight charge for that country. Take note that countries within a certain area may have similar freight charges, except for some countries where shipping charges will be more high-priced due to the condition of their local logistics hub. It would be best to familiarize yourself with the different freight charge trends and differences on various areas around the world.
Using This System for Your Online Business
This procedure of working out shipping costs for free will give you an estimate of the range of shipping charges for various products. Take note that there are no exact formulas to generate a table of shipping costs as shipping charges are always affected by current economic conditions as well as variations in the charges given by shipping companies. By using dummy accounts and test orders on a regular basis as your reference, you can get an insight of what charges you can declare that will work best with you and your customers.
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