What percentage should I receive with drop shipping?

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I am planning on drop shipping with a company that ships out DJ equipment from China, however I want to ensure that I do this correctly.

With that being said, there are a few things I am confused about:

1. What percentage is usually given to the seller (me) from the supplier whenever I sell one of their products?

2. Can I JUST be the seller of the product and have the supplier ship it out? I've been reading on WF, and it sounds like this may not be a possibility?

3. How can I work it out with the supplier that they handle all of the technical problems?

4. Are there any legal import/export issues I should be worried about when being in the process of shipping in items from China as I am the seller.

The first two questions is the most important question to me. If able though, please answer all.

Thanks,
DJ Whrr
#drop #percentage #receive #shipping
  • Profile picture of the author Importexport
    Originally Posted by DJ Whrr View Post

    I am planning on drop shipping with a company that ships out DJ equipment from China, however I want to ensure that I do this correctly.

    With that being said, there are a few things I am confused about:

    1. What percentage is usually given to the seller (me) from the supplier whenever I sell one of their products?

    2. Can I JUST be the seller of the product and have the supplier ship it out? I've been reading on WF, and it sounds like this may not be a possibility?

    3. How can I work it out with the supplier that they handle all of the technical problems?

    4. Are there any legal import/export issues I should be worried about when being in the process of shipping in items from China as I am the seller.

    The first two questions is the most important question to me. If able though, please answer all.

    Thanks,
    DJ Whrr
    Hi DJ Whrr,

    I have answered your PM, but would like to put some of my response here because it may help others in your situation. I am not the right person to answer questions 1 and 3, although I have opinions, and 2 sounds like straight forward dropshipping, but here are my comments on 4:

    #4 Legality. From what you wrote on another thread about importing unlicensed headphones, I must repeat that I think you are taking a huge risk. Customs all over the world are on the lookout for unlicensed goods and will most likely confiscate and destroy them. If the value is beyond a certain amount, or if they catch it being done more than once, prosecution is very likely. Fines and even imprisonment are possibilities.
    Import issues. Apart from the above, importing is easy. For relatively small value items that are not very heavy, the postal service is a good way to go. Get your supplier to quote you for door to door delivery. If your supplier uses EMS, the postal service will handle the customs clearance. If you are dropshipping, your customer may be hit with duty and sales tax, and that makes many people angry. If on the other hand you import a small inventory so that you can ship direct to your customer, you will have paid any duty and the customer is more likely to be happy.

    Don't let your supplier issue false value invoices or describe the goods as gifts. Apart from being illegal, this can lead to problems further down the track.
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  • Profile picture of the author Kalanag
    To answer your first question:

    If you are a dropshipper you will know the price you have to pay to your supplier. The sales price is up to you. So it is you who determines the percentage you gain. This is the difference to affiliate marketing.
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    • Profile picture of the author DJ Whrr
      Ahhh, right. Good points.

      OK thank you all.
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      Check out my site for more help on learning how to DJ!: www.learnDJingfree.com

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    • Profile picture of the author OnlineStoreHelp
      Originally Posted by Kalanag View Post

      To answer your first question:

      If you are a dropshipper you will know the price you have to pay to your supplier. The sales price is up to you. So it is you who determines the percentage you gain. This is the difference to affiliate marketing.
      This is not a completely accurate answer. Theoretically you create your own price but if you are selling headphones for $100 that everyone else is selling for $50, you will be hard pressed to make sales. Generally speaking, I always look for a margin of at least 30%. between wholesale and MAP or MSRP. More is better but with 30% gross markings you will cover your variable and part of your fixed costs, be able to run some specials and make a little money. Anything less and you won't cover your variable costs (depending on actual selling price).

      If it is large ticket items you can take a small margin but I wouldn't go for any thing less than 25%
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      • Profile picture of the author Importexport
        Originally Posted by OnlineStoreHelp View Post

        This is not a completely accurate answer. Theoretically you create your own price but if you are selling headphones for $100 that everyone else is selling for $50, you will be hard pressed to make sales. Generally speaking, I always look for a margin of at least 30%. between wholesale and MAP or MSRP. More is better but with 30% gross markings you will cover your variable and part of your fixed costs, be able to run some specials and make a little money. Anything less and you won't cover your variable costs (depending on actual selling price).

        If it is large ticket items you can take a small margin but I wouldn't go for any thing less than 25%
        I was never interested in dropshipping, because the margins are too low for the effort involved. For 22 years until forced retirement I ran an importing business, selling B2B. The lowest margin I would ever consider was 60%, but I often achieved much better than that.
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        Use emotions and perceptions to build a great brand. Ask me about my book LabelsThatExploit. For safe sourcing and easy importing from 41 countries globally, see https://provenglobalsourcing.com
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  • Profile picture of the author erange
    ...don't some drop shippers also require merchandise to be sold "no less than" a certain amount? I haven't dabbled much in this arena...but I thought I ran across that once.

    Eileen
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  • Profile picture of the author Joe Stewart
    The thinking here seems to all be based upon marketing online. However, there are many ways to drop ship products other than using the internet as your primary advertising source. I've been drop shipping since 1993, owned three separate businesses since 2001 and haven't used the internet at all, but still make margins of 50% on average, but sometimes as much as 250%, depending on the item.

    My customers are VERY happy, get great prices, high quality "name brand" products and are usually very happy to hear from me. Some of them I've done business with while working for six different companies over that 20 year span. That's loyalty.

    I also know of other companies that are doing exactly what I'm doing and making a killing at it.

    People need to get out of the habit of worrying so much about what your competition is doing and focus on other important things besides just prices.

    People also need to stop looking at the internet as the only way to advertise. There are other options that are much faster and can result in instant cash.

    I can see a product coming very soon. There are a lot of people struggling with this and they wouldn't be if they knew a basic set of rules. More later.
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  • Profile picture of the author malia
    People also need to stop looking at the internet as the only way to advertise. There are other options that are much faster and can result in instant cash.

    I can see a product coming very soon. There are a lot of people struggling with this and they wouldn't be if they knew a basic set of rules. More later.
    I would like to know more about this. If you offer private consulting, please PM.

    I'm actually working on implementing this now.

    Thanks!
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