Why Dropshippers don' t work?
These middleman dropshippers not only make money from you by charging a monthly fee, but then rip a percentage of profit from each of your orders. These companies often advertise aggressively on many sourcing information pages and jam the search engine results.
Why Dropshippers do work?
Dropshippers do all the product sourcing, warehousing, inventory maintenance and order shipping for you. The ideal dropshippers would offer you a true wholesale price that you can't find lower anywhere. The major benefits are that you don't need to buy any inventory or incur any inventory and fulfillment related expenses. You can only offer what they are carrying, just like any other competitors of yours who use the same dropshipper. More importantly, you have to rely on them to ship out your product which means it can take a day, or so, more, for them to ship out your orders than if you do it yourself. They should only charge you a very low dropshipping fee or nothing at all. Pay carefully attention to these extra fees, as they could add up and eat away at all of your profit. Some companies try to make more money from you, by charging you higher shipping rates than standard carrier rates. The disadvantages are that your dropshippers are wholesalers that only carry the types of product and the quantity that they want. Some companies even provide product descriptions and photos for your web listings.
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