So you don’t have to inventory any goods. Sounds like a great business, right? OK, let’s look at the hidden costs of using someone else to do all the work for you.
Entrepreneurs like control. That is why many of them quit their day job, because they did not want a controlling boss. That is why the divorce rate is higher among entrepreneurs…
Anyway, when you are not physically looking at the inventory and you are not physically handing a package to the UPS driver, you are not in control. Drop shipping takes this control out of your hands. Unless your vendor calls you right away when something is not shipped, you have no idea that you did not perform, or until an irate customer contacts you and wants to know where is the beef? Since you are now in the dark, you really feel out of control and start thinking about going back to your day job. You then start to take your frustration out on your spouse and that is how drop shipping contributes to this higher divorce rate…
Entrepreneurs like a complete story. Many customers come to your site and buy several different items. If one of your drop shippers out of four doesn’t ship in a timely manner or not at all, they become the rotten apple that spoils the customer’s experience with your site. If you sell on eBay or Amazon, the seller gets rated on their performance. If you are relying on several drop shippers to secure your reputation, then I can almost guarantee you that one or more will disappoint you and thus will in turn disappoint your customer. When it is all said and done, at the end of our lives, our reputation is the one thing that stays with us. You don’t want some drop shipper to mess up your reputation.
Entrepreneurs like value. One of the reasons so many businesses are gravitating to the Internet to sell goods is the internet is the one marketing arena that if you are careful, can give the biggest bang for the buck. So if you are advertising thru PPC (Pay Per Click) or relationships with other sites, the way to measure the success of the ad spend is through ROI (Return on Investment). As a business owner, you spend marketing dollars to sell products you believe in. If you own the goods, when you run out of stock, your ad comes down. When you drop ship goods and the drop shipper does not notify you when they are out, thousands of dollars can be wasted on marketing products that do not exist. Now that is a real bummer and can eventually put you out of business.
Now it's obvious: It pays to read.
You've just come up with the one aspect I had never before given an other thought. I have always been checking double on dropshippers, but more by intuition then because I thought it to be important for my image. I even never considered the internet as my ONLY public image on trading, accesable to all (new!) clients. But you are right: The internet is nowadays so important, that image on the net is about to become the most important aspect in trading.
So many thanks to you for this article ! It has changed my view on this subject, and a number of other aspects ..........
Dirk
That makes your point even more valid; you need to find the most riliable drop shippers possible as they ultimately will put your dreams and visions into motion. If the drop shipper can't perform for you and your customers, in your customers eyes; it is you who can't perform and won't get the residual business you are looking for.
Look at some of the companies on my prior posted articles and you will find solid drop shippers who can perform.
Quoting from [Dirk de Jager]:
Now it's obvious: It pays to read.
You've just come up with the one aspect I had never before given an other thought. I have always been checking double on dropshippers, but more by intuition then because I thought it to be important for my image. I even never considered the internet as my ONLY public image on trading, accesable to all (new!) clients. But you are right: The internet is nowadays so important, that image on the net is about to become the most important aspect in trading.
So many thanks to you for this article ! It has changed my view on this subject, and a number of other aspects ..........
Dirk