The number one question we receive from readers who want to open their own shop online is the way to go about finding vendors and suppliers. How I can buy wholesale? Should I drop ship or do I contact the manufacturer directly?
Drop Shipping
Most people fall into the trap of sending excited about the fall of the first open your online store. Drop shipping seems attractive for several reasons. On the one hand, you do not have to stock any merchandise. Each time an order comes in, just place the exact same order that the drop shipper and reap the benefits on the basis of the difference in price.
There is no inventory, no compliance obligations and all you have to do is take orders. Sounds like a dream come true?
What many do not realize is that profit margins often suck and you have to provide customer support for problems that are completely out of his hands.
What if the bolts drop shipper for order or shipping the product to the end? What if the drop shipper ships routine defective items? You know what? You must address all these issues even though they are not their fault.
Couple that with the fact that profit margins are very small and have a situation where you are sacrificing your mental about things outside their control for very little money.
Even if you manage to find a reliable drop shipper, customer problems and still will be much more difficult to deal with them when they have no control over their products. In short, we play the prestige of your business in a third party who may not have your interests in mind.
Buy Wholesale Internally
Because virtually nothing is being done in America anymore, utmost care of all the problems of import and storage of goods from the manufacturer. You do not have to travel to a strange place. You do not have to deal with shipping or customs. You just place your order and the merchandise appears at your door.
Buy in bulk also saves you time from having to perform a continuous quality control checking of their merchandise, presumably because the wholesaler has been through already.
But guess what? All these benefits come at a price and directly affect your bottom line. What if you could manage it all yourself?
Buy direct from foreign manufacturers
Buy direct from the manufacturer is the holy grail of marketing, but also has the most work, dedication and time. These days, almost everything is manufactured overseas because labor costs are much cheaper there.
Buy directly from the manufacturer or supplier abroad is the best way to get lower prices, but also presents the biggest headaches in advance. Here is a list of things we had to face in finding our suppliers.
* You must buy product in bulk, sometimes more than they are comfortable with
* The logistics of shipping large number of products abroad can be a major nuisance
* You will receive products shipped shit at some point and have to constantly go back and forth with your provider about quality issues until resolved.
* Product returns are very complicated
* No long lead times for the manufacture of products you have to plan ahead.
* There may be long lead times just to get samples of products you wish to sell.
* Some of these vendors are frankly incomplete
Direct purchase overseas is worth it?
After reading about all the disadvantages described above, is it really worth it? The answer is a resounding yes. The prices are unbeatable and the initial investment is a value in the long term.
Once you've established a good relationship with a vendor, it becomes smooth sailing thereafter. You will be able to competitively priced products. You will be able to price the larger chains and you will be able to differentiate themselves from competitors.
Once you have confidence in their manufacturers then have the freedom to start designing their own products and that's where the money starts to kick insi you have the talent to design their own articles, which have the potential sales totally unique products that no other store in the world has to offer.
How to find overseas suppliers?
A great place to start is online. A variety of search engines for overseas manufacturers. For example, alibaba.com is good starting point for a wide variety of items.
Once you've found some potential providers, call them and email them. Having an idea of whether or not to bring the products you are interested in.
Once you have narrowed down potential suppliers, you should jump on a plane and visit directly. Especially if it comes to Asian suppliers face to face communication is absolutely necessary to establish a good relationship.
By visiting directly, they are achieving three main things. One of them, you are showing them that you are serious about buying them. Two, you get to see their stocks of goods in person to judge its quality. And three, to be able to put a face with a name and get to know on a personal level.
The choice is yours
How would you prefer to get their products from their suppliers depends on you, but the direct purchase is a no brainer in my book. The more work you are willing to put into your business, more profits are going to do. No one said that opening an online store would be easy. To make a greater investment of your time in advance, which will pave the way for greater rewards in the future.
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