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Dropshipping Guitar Products-finding a partner

by Ryan Petersen
6 replies
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I am not sure this is the correct forum for this, but I could use some suggestions from experienced e-commerce folks.

I run a high end Guitar & Bass Amplifier and Boutique speaker manufacturer, located in Central America and over the past few years we have had a hell of a time trying to build a direct sales force and marketing team in the country were located in. I invested in this group expecting that we would be able to with some work find folks locally, but the sales and marketing culture locally is not what we need and we haven't been able to succesfully hire.

To that end we are formulating a strategy to offer deals to US based drop shippers and eCommerce professionals to take over our direct sales in the US and Canada. In addition we are considering turning over Marketplace ( such as amazon ) based sales to a 3rd party... We assume this will allow us to focus our limited english speaking resources on pushing direct sales to these platforms.

The risk as we see it , is finding the right professionals to take over these operations.This plan puts our direct sales ( around 60% ) of our revenue at risk, so in order to mitigate that, we must partner with highly motivated sellers.... Our objective is continue growing and we can hardly afford a 60% drop in revenue... We also can not continue growing without a large and aggressive sales operation.

My questions to the warriors out there is , where is the best place to find the right partners for this, and have you seen other brands direct approach any market successfully with a similar strategy ?
#dropshipping #guitar #partner #productsfinding
  • Profile picture of the author dave_hermansen
    I think step one is to get your products warehoused in the region that you want to sell to. That way, they can be conveniently dropshipped.

    Step two would be contacting all of the websites that sell those products in your targeted regions (i.e. the United States) and letting them know that you will dropship from your (USA-based) warehouse.

    We constantly get requests from new brands and manufacturers to offer their products on our sites and if they are good products and we get a decent wholesale price, we are more than happy to do it. It is a win-win for both sides.

    With one of the niche websites that we own, we were approached by a manufacturer that we had never heard of. They had been in business for more than a decade but only sold direct to the public from their website. They started reaching out to online stores, offering to dropship and picked up dozens of new sites to market their products (obviously taking a hit to their profit because they had to sell at wholesale). Three years later, they are now considered one of the top brands in the industry and get a ton more direct sales because they are now a known brand.
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    • Profile picture of the author Ryan Petersen
      Thanks for the well thought out reply

      We already have a decent sized warehouse and direct to end user shipping operation

      I think our big challenge is finding shops that target our audience.. as it seems with higher ticket items we need folks with guitar amp specific knowledge.

      So our plan in really to turn over the current sites,client base , ect to the right operation ( if we can find the right one) in addition to adding any dropshipping shops we can find..
      As while we will lose some margin, we simplify our operation and we can permanently remove any channel conflict, which is most likely limiting our sales with the larger retailers ( the guitar amp market is high concentrated with 2 large retailers with combined 85% market share)
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      • Profile picture of the author savidge4
        Originally Posted by Ryan Petersen View Post

        So our plan in really to turn over the current sites,client base , ect to the right operation ( if we can find the right one) in addition to adding any dropshipping shops we can find..
        In the world of e-commerce what you are wanting to do HISTORICALLY is selling your soul to the devil. in the end - nothing good will come of this. Do some research on Barnes and Noble and Toys R Us, and look at where they are now. In both cases they farmed out the online portion of their operations, and it was straight up foolish.

        You need to think less about hiring from the bottom up IE 3rd party resalers etc, and start looking for a High Management level Director of online sales that can coordinate and direct your company into the direction it needs to be in.

        Like the side story of daves... this would be the person that reaches out and creates the relationships where they need to be - That helps create REACH and BRAND building in the long run.

        You really need to get a grip on this and not allow throwing your hands up and saying I quit be the answer... that will be the beginning of the end for everything you have built.

        Take a deep breath... start looking at your situation from the point of where you want to be, and start developing the layers from the top down to get there. It sounds like you already have a lot of the infrastructure in place, you just need to learn how to utilize what you have with someone that can oversee that and grow it into relationships that will work for you, and not the other way around.
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        • Profile picture of the author Ryan Petersen
          The problem we haven't really isn't about not being able to build a direct sales operation, we already have one that is doing fairly well..

          Its about the channel conflict we have with Big box retailers, who wont get fully behind us as long as continue to sell directly to end users.. So in order to grow that potentially much large portion of business ( in the guitar market, there are 2 major retailers that controll the great majority of the market) we must get rid of the direct sales.... the problem is however chicken and egg for us... as we are currently dependent on direct sales... so our solution is to basicaly give that business to a partner.. therefor removing channel conflict and allowing us to focus on the bigger piece of business
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  • Profile picture of the author dave_hermansen
    Most manufacturers experience this and get around it by implementing M.A.P. pricing. As long as nobody is undercutting someone else's advertised pricing, everybody is on the same playing field and the businesses that succeed will be the ones that provide the better service and who know their products the best. M.A.P. pricing is extremely common in the music equipment industry.
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  • Profile picture of the author Johnny12345
    Ryan,

    I think one of the most important things for your marketing will be producing effective promotional materials -- for both print and video.

    Your copy and images need to tell your story and use emotion to sell. If your promos are boring or focus on features and specifications alone, you're probably going to miss the mark.

    For example, a company that might be worth looking at -- in terms of learning to market products -- is B&G Guitars (they're on YouTube).

    They have videos that:

    1) Focus on the sound and beauty of the product. (You're not selling hunks of wood and metal -- you're selling art, beauty, sound quality, and emotion.)

    2) Show the care and craftsmanship that goes into constructing their guitars.

    I think both are important for high-end products. Remember: Sell the sizzle, not the steak.

    John
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