The Right Way To Find Dropshippers
Finding Suppliers--This seems to be the biggest mystery surrounding starting online stores. People talk about suppliers like they are super-secret, super-exclusive, and their default mode is to NOT do business with you. Remember, your money is green! And also remember, most of their customers are likely small businesses as well...so it's not like they're dealing with Walmart, Best Buy, Target, and then YOU.
Start with the market you want to enter. Assess the competition. And then look for suppliers...a few tips for finding them.
a) Find the product you want to sell and call the manufacturer to ask for distributors.
b) Avoid the words "Wholesale" when doing searches. Opt for "distributor".
c) You want to deal with companies that work ONLY with resellers. "Trade Only" is what you're looking for. Retail shops with wholesale prices are not distributors.
d) Use McCrae and other business directories to find suppliers. Beware, the search features on those kinda suck.
e) Definitely look for trade shows. And you don't even have to go to them..just find the websites and look at the exhibitors list. If it sounds like a wholesaler, look for their website. Remember, they aren't necessarily in the business of selling to the public so their websites usually aren't optimized.
Finding Dropshippers--This is an even bigger "secret" that most people don't realize. Most people start backwards. They find dropshippers and then choose from their products. BIG MISTAKE. First find the suppliers, real suppliers, AND THEN you ask them if they dropship after you establish a little rapport. These companies do not want to deal with Ebay sellers so don't lead with those questions. Tell them you are a retail operation, tell them you're interesting in purchasing from them, and then ask for a catalog and price list. BOOM. Most WILL charge a dropship fee of $5 or so, but that's the price you pay.
And for the record, I am in a number of markets. All my suppliers dropship...ALL OF THEM. And these suppliers are the leaders in that market. And guess what? None of them are listed in the WWB directory or Saleshoo. I'm sure you can guess why.
A Couple Sneaky Tricks:
1) A VERY simple way to determine competition is this. Find the leader in the market and place an order. Wait a couple weeks or a month, place another order. Most shopping cart software is sequential and to see how many orders they took over that period, just take the difference.
2) If you suspect your competition dropships and you wanna know their sources, just order the product from them. Get the return address and then do a reverse search on the address. Simple.
More Nuts/Bolts stuff:
Evaluating Keywords--Most people know to do this already so I won't get into it. But obviously, you're looking for more buying keywords.
Evaluating Competition--Again, same thing here. The good news is that with e-commerce stores, most people DO NOT spend much time on SEO. So if you do it, and do it consistently, then you'll be far ahead.
1) More than 15 products? Get a real shopping cart. There are TONS of good ones out there. I personally like X-cart, Shopsite, or Yahoo Stores. People can probably name tons of other decent ones. But if you have a lot of products, you don't want to mess with something like 1shoppingcart where all you're getting is a "buy" button. WAY WAY WAY too hard to manage.
2) Design Matters---Think about it, you're getting someone to pull out their card. Trust matters. And plus, the bar has been raised in the last several years. Spend the $1-$2K and get a nice design.
3) Use Your IM Skills---Little things like upsells, email marketing, save a sale scripts, coupons, etc are all the equivalent of printing money. You would be amazed at how effectively these things work. In almost every market i'm in, I have a free PDF that I gave away that opts in the prospect. And every month, I send out a monthly deal that is exclusive to my list. This is ontop of email blasts I do. Easy stuff.
4) Work with your suppliers---Suppliers have specials every month. Pay attention to them and take advantage. Last month, one of my suppliers had a "Buy 2, get 1 free" deal on a $300 product. Needless to say, I took full advantage and sold them for cost in order to cash in on the free product. They do this stuff all the time so you have to pay attention.
5) Try and use your own shipping account---This is a BIG hidding profit center. UPS has "stated rates" for anyone with an account. THe more volume you do, the better customer you become. And when you're a good customer, you get rebates. With UPS, it's not tough to get 25% discounts on everything you ship once you start doing some volume. So you charge your customer the stated rate and you essentially make 25% on shipping costs. Or test just lowering shipping prices. Either way, lots of options.
6) Work with suppliers part 2---Just like affiliate managers, sales reps have the ability to work with you. Set a target of sales to hit before your dropship charges are waived. Say, do $1k per week in purchases and they'll waive your fee. Or just ask for better pricing...they CAn do that. Especially if you're highlighting it in an email blast to your customers.
7) Market Smart---Do you have a dropship fee? Well, the easiest way to combat that is by increasing the order value in order to make it less significant. So make some compelling offers as an upsell. For instance, if you're selling Camcorders (not recommended) and you'll incur a $5 dropship fee. Take the most popular other product to go along with it, like a carrying case, discount it (but leave $5 profit) and then offer it as an exclusive upsell. That will absorb your dropship fee.
8) Use Coupons Smart---If your average order size is $20, then give people a coupon for orders OVER $25. You want the order size to increase.
9) Don't worry about buying from China until you actually are selling something. You sell products first, improve margins later.
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