In today's world, many people try to operate a profitable business by using the internet. It is much simpler to have a virtual storefront than to have a brick and mortar store. In addition, it is much cheaper to operate. One of the major reasons that the cost of operation is minimal is due to the process known as drop shipping.
Drop shipping seems to be a magical way of getting merchandise, selling the merchandise, delivering the merchandise, while not visibly seeing the merchandise. This may sound a bit complicated but actually, it is very simple.
To use an example let us use the Dutch Maid Manufacturer of cleansers. Dutch Maid makes a lot of product but they are not in the business to sell or distribute the product. The next group let us introduce is Mr. Distributor who is the person who goes to the Dutch Maid Manufacturer and contracts to buy the product by the case at a dollar a can or $12 a case.
The Manufacturer declares that it cost him .50cents a can to make, so there is a $6 a case profit. The Manufacturer is happy because he has profited without having to try to sell or advertise which has greatly saved on the company's profit margin.
Let us take this a step forward, as Mr. Distributor now needs to sell the product in one of two ways, which are by soliciting retail stores and having them agree to buy the product or by opening up a website where Mr. Distributor can take orders and sell on line. In both cases, the process of drop shipping plays a vital part in Mr. Distributor business.
First Mr. Distributor now has a good product for resale but does not have to keep it stored nor does he have to open up a storefront to display the product. He is using the drop shipping method simply put the retail stores order from him and he sends the order to the Dutch Maid Manufacturer who sends the product to the customer. This is why the use of drop shipping is the best way to run a business without too much investment.
This sounds like a sure fire way to make money without loosing a truly profit making opportunity. Unfortunately, success stories are rare as those who venture into this line of business balk under the adverse and challenging realities of the competitive medium. The primary reason for these unfortunate cases is not in the business plan or the lack of commitment on the part of those behind the idea, but rather it is inadequate and unreliable information.
Most entrepreneurs fail because they did not locate genuine and legitimate wholesale and drop shipping companies. The other reason being the drop shippers is not supplying the kind of niche goods that actually generate not only high number of sales but extremely high profits as well. The use of a good drop shipper is one of the most vital aspects of a distributors business.