First let me say that drop shipping is a service provided by a manufacturer, a wholesaler, and a retailer. But in order for you to make money with drop shipping you need to deal with either a manufacturer or a wholesaler, avoid dealing with a retailer because your profit margin will be next to nothing. This is why it is very difficult to make money doing drop shipping the way DS Domination teaches.
HOW TO FIND WHOLESALERS
Being that using a manufacturer is difficult to start up a drop shipping arrangement with, the next best option is to deal with a wholesaler. But you need to deal with a real wholesaler and not a retailer selling at just above wholesale prices, though this could still be of a benefit and I will explain why in just a bit. But there are certain ways to tell if a wholesaler is legitimate.
- Monthly Fees: A real wholesaler will not charge a monthly fee to their customers for ordering from them, if they do they are likely not legitimate
- Selling to the Public: Any wholesaler that offers products to the public at what they claim to be “wholesale prices” is just a retailer selling at near wholesale prices
- Wholesale Account: To get real wholesale prices you will need to get a wholesale account to prove you are a legitimate business
- Minimum Order Amount: Some wholesalers require a minimum initial order size and do this in order to weed out people who will not be serious in creating a long-term business arrangement
BENEFIT OF RETAILERS SELLING NEAR WHOLESALE
Like I said above, using a retailer that is claiming to be a wholesaler, which is selling at near wholesale prices, can still be beneficial to you when doing drop shipping. Example: For those times when a drop shipper requires a minimum order amount, dealing with a retailer selling at near wholesale prices, can provide what is needed and still give a bigger profit margin over regular retail.
But if you want to work with a particular wholesaler that happens to require a minimum initial order you could do the following. Pay them an advance equal to their minimum order amount and tell them to use it towards future drop shipping orders with them. This will help to establish a line of credit with them and let them know you are serious about doing business with them.
NEXT UP = Why drop shipping is not the most profitable