Article Categories
» Arts & Entertainment
» Automotive
» Business
» Careers & Jobs
» Education & Reference
» Finance
» Food & Drink
» Health & Fitness
» Home & Family
» Internet & Online Businesses
» Miscellaneous
» Self Improvement
» Shopping
» Society & News
» Sports & Recreation
» Technology
» Travel & Leisure
» Writing & Speaking

  Listed Article

  Category: Articles » Careers & Jobs » Work From Home » Article
 

Drop Ship Your Way to Wealth




By J. Stephen Pope

Your customer sees a marvelous array of products on
your website. After thoughtful consideration, she
purchases the product she wants. Amazingly, you
have never actually seen the product. That is
because your supplier shipped the order directly to
her.


1. Problems With Stocking Inventory


After deciding what products you will sell, you are
immediately faced with many challenges.

First: "To stock my products, will I need to rent
store or warehouse space? I was hoping to sell
by Internet, mail order, or export, but I don`t
have much storage space for inventory at home."

Second: "Will the supplier even deal with me if
I don`t have a retail location? I was counting
on keeping my overhead down by operating from
home."

Third: "I know that many manufacturers and
distributors have a minimum order, sometimes in the
thousands of dollars. I don`t have that kind
of money!"

Fourth: "Even if I did have the money, why should
I tie it up in inventory? How do I know if the
product will even sell?"

Fifth: "I guess I will have to add extra insurance
coverage for my inventory. Maybe I better upgrade
my security system while I`m at it."

Sixth: "The shipping charges are going to kill me.
First, I have to pay to get the goods here
(freight-in). Then, I have to pay to ship the goods
out to my customers (freight-out)."

Seventh: "If I expand and hire employees, how will
I control the inventory? How will I know if my
employees are stealing from me?"

Eighth: "How much time and money am I going to spend
packaging and fulfilling orders?"

These problems can be reduced or eliminated by drop
shipping.


2. Drop Shipping to the Rescue


Drop shipping is a method of selling products
without stocking inventory yourself. You don`t need
to stock inventory, because you only order an item
when a customer requests it.

With drop shipping, when you make a sale you contact
the manufacturer or authorized distributor and make
arrangements to pay for the order at your wholesale
cost. Your distributor then ships the product to
the customer with your invoice and shipping label.

For example, let`s assume that you have just sold a
product to a customer for $100.00 plus shipping
charges of $15.00. Having received the customer`s
payment, you now need to fax or otherwise send your
order to your drop ship supplier. You will need to
pay your supplier, by credit card or other means,
your cost of $50.00 plus $15.00 shipping. This
leaves you a $50.00 gross profit. Your supplier
will now ship the product to your customer.

With this arrangement of not having to stock
inventory yourself, there are many advantages.

You eliminate the high costs of holding inventory.
There is no need for you to rent expensive storage
space, finance high minimum orders, get stuck with
goods that don`t sell, or pay other expenses
associated with maintaining inventory.

Indirectly, you do pay inventory costs. Your drop
ship supplier must maintain his inventory and pay
all associated costs, including freight-in, storage
space, insurance, accounting, shrinkage, and so on.
To make a profit, he must pass these costs on to you.

The real advantage to this drop shipping arrangement
lies in keeping your costs variable. Instead of being
stuck with these expenses up front, whether you sell
or not, you pay only when you make a sale.


3. Profit From Drop Shipping


Many legitimate drop ship suppliers may not require
you to have a retail location, but they will want to
see evidence that you are in business. They may
require you to produce a resale license or retail
sales tax permit.

To be sure, there are pitfalls to watch out for in
drop shipping. For example, some suppliers claim
to sell at wholesale prices but are actually selling
closer to retail. Also, margins are very slim in some
competitive areas, such as electronics. However,
with proper research and information, you should be
able to avoid these problems.

Whether from your home, retail store, directly from
your website or through an online auction, you can
arrange to sell an item before you purchase it. That
way you have nothing invested in inventory and won`t
get stuck with stock that won`t sell.

Rather than financing and stocking inventory yourself,
consider drop shipping your way to wealth.

 
 
About the Author
J. Stephen Pope, President of Pope Consulting Inc., has been helping
clients to earn maximum business profits for over
twenty-five years. For valuable Work at Home Small Business Ideas,
visit: http://www.yenommarketinginc.com/

For more information about drop shipping, visit
http://www.yenommarketinginc.com/dropship.html

Article Source: http://www.simplysearch4it.com/article/1455.html
 
If you wish to add the above article to your website or newsletters then please include the "Article Source: http://www.simplysearch4it.com/article/1455.html" as shown above and make it hyperlinked.



  Some other articles by J. Stephen Pope
Make Your Fortune as a Professional Finder
Have you considered the lucrative opportunity in finder`s fees? You could become a professional finder and earn a fortune from this alone. Alternatively, you could supplement your present income with finder`s fees. A ...

How To Really Profit from Domain Names
Have you heard about domain names that sold for over a million dollars? Inspired by this, you imagine registering a great domain name, hanging onto it for a while, ...

  
  Recent Articles
Making Money with Online Data Entry
by Awad Sayeed

Why Pick Up Mystery Shopping among all the other Freelance and Work-At-Home Jobs?
by Mike Smith

Online Course Teaching How To Make money At Home
by P A Archer

Tips on working from home
by Elyse Lavery

Your Key To The Work From Home Dream
by James Bradley

The Impact of Internet Work At Home Jobs Explained
by Harrold Swalve

Affordable Vacation Membership That Pays You!
by John R. Bohannon

What Is A Cash Paid Survey?
by Edg holm

Fundamentals Of Affiliate Marketing
by cher k markov

Anyone Can Work From Home
by James Bradley

Holly Mann's Thank You Rich Jerk Reviewed
by Chris Bruso

Innovative Ways to Find Scam-Free Data Entry Jobs
by Arun Kumar

Web Based Investment Group Helps Condo Buyers Find Financing For Florida Condos:
by Michael R. Linton

Internet Work at Home Jobs; Deal or No Deal?!
by Steve Peterson

From 29 to 30 day on internet business
by Wolney

In life and in Internet marketing, it doesn't matter what you know. It only matters what you do
by Wolney

Can't connect to database