How to set up a drop shipping business in seven easy steps

A drop shipping business is an easy way to make money online with minimal investment from you. By using a drop shipper, you act as a middleman, reselling another companies’ products. This means that you don’t need to keep any products in stock and only purchase a product once you’ve sold it. It’s a good way to drop shipping business. With the drop shipping method, you list a product for sale. once someone buys it you contact the supplier place your order and have it sent directly to your customer. It couldn’t be easier.

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It can avoid any investment in stock, and you don’t buy any products until a customer has made a purchase from you.

The following tips will guide you through this process so you can start selling online today and reap the benefits of drop ship business.

Step 1 What Should I Sell?

The first step is to decide what products you want to sell. Of course, it’s always easier to sell a product you’re familiar with but you must make sure there is enough demand as well.

Have a look online and see what products are selling well in your country or city.  Is there a local demand for some goods that aren’t being met, for example, unlocked cheap phones or media players?

An easy way to check demand is to visit eBay, do an advanced search for the product you want to sell. Sort by price with the highest first and select completed listings only, now you can see what the bestselling item was.

You can also do a similar search on Amazon.  You should note the quantity sold as well as prices.

Be sure to check out any competition as well, and make sure the products you offer will be a better quality and better value for money.

Step 2 Where to Source Products?

Once you have decided what product you want to sell you need to research drop ship companies. These will be your suppliers. So, you need to check a few things.

  • Check their product range and prices
  • See if they have any discounts or reward programs for frequent customers
  • Check they can ship to your country easily
  • Check how long items take to arrive
  • Check the returns policy for faulty or damaged goods
  • See if they have any API or App plugins for easy product updates

Then before you start selling you should consider doing a couple of test orders. It doesn’t have to be anything big but you want to make sure everything is running smoothly before you start promoting your goods and service.

Step 3 Where to Sell Products?

Before you can start selling online you will need a find a platform to sell on.  Perhaps the simplest way to sell online is to use one of the online sales sites such as eBay or Etsy. This is because they already have an audience that you can easily tap into.  Alternatively, you could list products for sale on Facebook or other social media sites and save listing fees. If you’re active online and part of seller communities then this is a terrific way to sell.

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If you have a little bit of money you could set up your own online web store with a service like Shopify or Magento. These platforms make it easy to setup and manage your own web store and are fairly simple to use with online documentation to help you through each step. They usually have a free trial so you can test them out before you commit to buy.

Step 4 Setting Up My Seller Platform.

After you have your seller account on eBay or you’ve set up your store you need to list the products you have for sale.  Remember on eBay there will be a listing fee but check to see if you can take advantage of free listing deals.

If you set up your own website with something like eBay,  Magento or Shopify you can check to see if your supplier has an API. You may even be able to find a plug-in for some eShop sites OpenCart, Magento, and WooCommerce. This is one such example :-

An API is an Application Programming Interface, it lets two systems talk to each other automatically.

An API allows you to use a private data feed to automatically update your site with the information from another page. This means that when your supplier adds new products to their store they can be automatically populated into your online store as well.

Setting up an API can be a little complicated, as unlike apps or a plug-in the API is just a set of shared parameters. In order to make use of it, you need to write the code to request the information that your site will require so it may be necessary to hire a programmer to help you with this.

This communication will be set up with Query calls (these ask for information) and Action calls (that provide information).

So, in order to list the categories, you would use the getCategory query, and for product details, you would use getProductlist. To create an order your API code would issue the creatOrder action call.

If you set up your drop shipping website in WordPress then  is another option. These sites have written the API code needed to updated sales sites and make this available to purchase.

Step 5 Promotion

Once the items are listed on your account or website you need to wait for the orders to come in. This is a good time to start promoting the products you’re selling. You can post messages on social media, join relevant forums or spend money on ads to persuade more customers to buy from you. Understanding your market and selling locally brings a big advantage as you can change your product range to meet local goods need and demands.

Whether it is through word of mouth, PPC marketing campaigns or social networking you want to build a customer base that will keep coming back for more.

Step 6 Placing Orders

When you receive an order, you will need to confirm receipt of payment and then place your own order with your supplier. You should have email alerts in place to inform you each time a sale is made so you can ensure the products are dispatched without delay. Of course, if you are using an API then a lot of this can be done for you but it’s still wise to manual check payments on regular bases.

Step 7 Import Tax

Many countries have some form of import Tax. This is to prevent foreign companies from flooding the market with cheap alternatives.

Importing a large order of goods such as stock for a store would typically be subject to the payment of these taxes. However, most countries allow for the importing of a small number of items, such as samples or gifts under a set value. By drop shipping direct to the end buyer you and the customer are likely to avoid these taxes. That is because most orders will be under the threshold that requires any import or customs tax.

If you’re thinking about dropshipping or are already using a dropshipping business, we would love to hear from you. Let us know if you have any questions or if we missed out anything you would like included in this article. We look forward to reading your comments and input.

Thanks, from the AlimDropship.

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