In troubled economic times, as many people are losing their jobs and others are increasingly pinched for cash, it might
be useful to consider an alternative.
The approach described here is not for everyone, but if you like to work on your own — if you'd like to run your own business — then online marketing and stockless retailing,
wholesale product sourcing and drop shipping, might be something to consider.
In a nutshell...
You do some research and identify a niche market, then source product from a wholesale supplier with whom you establish a wholesale account.
You promote the product on eBay, your website, to your email list, or by other means.
When the product sells and you receive payment, you purchase the product from your supplier at wholesale cost, provide the name and address of
your customer, and the supplier drop ships the product directly to your customer.
You keep the difference between what the customer paid you, and what you paid the wholesaler.
You don't store or ship anything. No mess, no fuss. And if the product doesn't sell, no money changes hands. You can try other promotional strategies, other venues,
find other products to promote, etc.
The nitty gritty...
If you want to sell product online, you'll need to find a wholesaler from whom you purchase product, and reputable wholesalers will not deal with you unless you're legal.
It is essential that you "get legal" — obtain a business number
[PDF] (Canada) or, if you're in the U.S., a Sales Tax ID — see table at right.
Whether you're running a sole proprietorship or you become incorporated, you need to keep accurate records of your dealing and take
responsibility for taxes and other fees (e.g., with profits > $30K/y as a resident of Canada, collecting GST from Canadian customers).
None of this is rocket science, but you'll save yourself a lot of time and aggravation if you do it right the first time. It is very useful (and often much less costly) if you work with people
who have been there and done that — people who are still doing it because they have succeeded where others have failed.
In the next few paragraphs, we look at recommended strategies and solution, beginning with Chris Malta and Worldwide Brands.
Worldwide Brands — Nobody does it better...
Better Business Bureau — Accredited Business — Rating: A+
I am a member of eBay Certified Service Provider Worldwide Brands, a company that sets the industry standard for reliable wholesale product sourcing and drop ship contacts.
Chris Malta, CEO of Worldwide Brands, has built a solid reputation in the field. He and his staff provide the most comprehensive package of product sourcing and market research tools available
anywhere online. They offer Malta even provides personal mentoring and workshops. There are more than 8,000 verified Dropshippers, Light Bulk & Volume Wholesalers in their database, and they add new
Wholesalers on a weekly basis. Their quick account setup feature makes it easy to set up free accounts with listed wholesalers. More than that, they include valuable market research data on
every single product these Wholesalers carry.
More Videos |
Product Sourcing Newsletter |
Free eBooks |
Articles |
Wholesale Scam Watch
Free Video Tour through the Product Sourcing Database
For a one-time fee of $299 USD,
here's what you get with a Worldwide Brands Wholesale Membership:
- Instant Access to 8,000 Certified Dropshippers, Bulk & Volume Wholesalers
- Over 8 MILLION Genuine Wholesale Products you can sell online
- Full Access to NEW Certified Dropshippers added weekly
- Our Certified Wholesalers DO NOT charge membership fees
- Instant Market Research data for all products
- Quick Research Analysis on every product search
- Easy-Search Wholesaler Database
- Bonus: Over 25 hours of Online Business Training Videos
- Bonus: Exclusive Industry Expert Workshops
There are several other service providers you might want to consider, because not everyone is
inclined to set up accounts with individual wholesale suppliers and drop shippers.
Doba®
Better Business Bureau — Accredited Business — Rating: A+
To address the needs of entrepreneurs who sought products from different distributors with less hassle, eBay Certified Service Provider Doba®
began offering an innovative service that affords access to multiple suppliers through one account. Costs were deferred through an annual or monthly membership fee, and the member did not require
a Sales Tax ID or other credential, since Doba® handled everything. Their annual and monthly plans have since risen in price, but Doba® remains an excellent choice.
Doba® drop shipping cycle...
Drop shipping is the shipping of merchandise from a supplier directly to a retailer's customer. This means that
the retailer can ship to their customers directly from the suppliers' warehouses. This process minimizes risk
because the retailer does not need to buy the product until it has sold. Suppliers take care of the warehousing,
packaging, and shipping of products, saving you a great deal of money.
The product selling process:
- Find products to sell from the Doba® Product Catalog.
- List those products on a web site or auction (use the descriptions and images on the Doba® site).
- After the product sells, collect the money from the buyer.
- Place the product order through Doba® after receiving payment from the buyer.
- The product is shipped directly to the customer.
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Doba® has been an eBay Certified Service Provider since 2004 and is regarded by many as the most trusted drop ship solution in the industry.
Their innovative business model enables the user to source product from 203 wholesale distributors, manufacturers and craftsmen (they add about 5/week),
all through a single account. They create relationships with U.S. suppliers and manufacturers who agree to drop ship products for Doba® members. The
monthly membership fee affords access to all of these wholesalers, some of the biggest in the nation, enabling small and home-based businesses to secure
product.
You even have access to them during your 14-day Free Trial .
Their Order Life Cycle fulfillment engine manages an order from the time a member places the order until the customer receives the product; you can track the order and update your customers as to order status,
so the hassles of returns, refunds, and reconciliations are minimized. Doba® doesn't require a business license or credit references to setup your membership, and, with the exception of their new Advanced package, neither do they
require a Tax ID. Most suppliers, wholesalers, and manufacturers in the aggregated group charge a small drop ship fee for pulling, packaging and shipping a single product from the
shelf - a product they usually sell in bulk — and you do have to pay that fee when you order. Doba® makes all such fees transparent
to the member, however, when he or she selects an item for purchase. Upfront and itemized, you see precisely what your costs will be.
Doba® does not take a cut of your profits - they finance their operating expenses entirely through subscription costs. More than 30,000 members. NOTE: We recommend this service for Canadians who market to the United States. Doba® suppliers ship only to the contiguous 48 States.
Drop Ship Access
Better Business Bureau — Accredited Business — Rating: A+
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Drop Ship Access is located in Monroe, Michigan. They have been in business since January 2005, and were accredited by the BBB in October 2006. There are many positive reviews of this company, and almost all
of them emphasize the high caliber of customer service. They serve as "middlemen" in the same sense as Doba®, enabling you to buy product from multiple suppliers without taking a cut of your profits — the service is paid for through the monthly fee. Depending on the product, wholesale prices are generally 30-70% below MSRP. Shipping cost is listed with each product, and varies per product(s) being shipped.
Most items can be shipped internationally, to Canada, the UK, and Australia; international shipping cost is also listed with each product. There's also a 7-day free trial,
and there are two plans — Advanced eBay, and Enterprise Website. The pricing structure has been revamped and plans are now available by monthly subscription, or as one-time-fee Lifetime packages: Advanced Plan ($295), Enterprise Plan ($695), with option to upgrade from Advanced
to Enterprise ($400).
Drop Ship Access is a member of the eBay Developer's
Program, and their Advanced package includes an eBay listing service that enables instant product loading to your eBay store. They have partnerships with 3DCart Shopping Cart Software,
eBay Research by Terapeak,
eBay (their site and catalog are integrated with eBay, so you can load products using their eBay listing service), PayPal, LegalZoom, Prostores, and LogoYes. They currently have more than 1 million high quality products in stock for subscribers to sell.
SaleHoo
Better Business Bureau — Accredited Business — Rating: A+
When I became a member and wrote my first review of SaleHoo in late 2006, I described significant problems with the site
and available offerings. That, I am pleased to report, is ancient history.
Since then, site navigation has been streamlined, databases expanded, load-time is extremely fast, and more in-depth
support services are available to SaleHoo members. SaleHoo maximizes member exchange regarding suppliers, enabling users to share
and compare experiences - a boon to newbie and experienced resellers alike. What you get here is not only solid data and
functionality, but a vibrant community as well. There's a Research and Analysis Lab, which enables you to search for
specific products or brand names, eBay demand, competing ads and keywords used, current option data (allowing you to monitor the market), and more.
Their new User Manual is packed with advice from the pros, explaining how to get off on the right footing with the suppliers,
lay the groundwork for negotiating the best prices, and create long-term relationships. You'll learn what suppliers want from you, how to contact a supplier and what to ask, how to get
the best wholesale price, how to place your order, and much more.
Most impressive is the country-specific advice provided at associated sites such as SaleHoo.ca. Whether you decide to become a SaleHoo member or not,
Canadians can avail themselves of the helpful directions and insider tips presented there, including information on Importing Goods into Canada and Tax basics for Canadian eBay Sellers and Business Owners.
I've covered these issues to some extent at our sister site.
SaleHoo membership: a one-time fee of $67.00 USD, with a full money-back satisfaction guarantee.
Wholesale Canada
You might also check out Wholesale Canada, offering a directory of Canadian drop shippers and U.S. wholesalers. Cost for access is $15 USD for 6 months, $20 USD for one full year.
China...
Finally, if you're looking for a reliable China drop shipper, it's worth reviewing Chinavasion — all business is conducted in English, and the site provides a great deal of support information. DHgate has an escrow service to help
protect buyers.
There are many other service solutions providers out there, including reliable niche directories such as Hienote Directory, a high-quality directory of drop shippers compiled
chiefly through trade shows and meticulous research. No matter how you cut it, finding the right fit for your needs and objectives does require taking a leap. It's best to do the free trials whenever possible, and it's also useful to look for an unconditional money-back guarantee such as that offered by Worldwide Brands. |
