30 July 2007

Using Drop shippers for online retailing

Many website owners and bloggers who are looking to monetize their sites only use AdSense. I think this is very dangerous and shortsighted. While AdSense is a good program Google has a habit of discontinuing accounts without notice and little explanation. If you read Googles own help forums on AdSense you will soon realise that if this happens to you you will have very little chance of persuading them that they have acted in error in terminating your AdSense account. So its a very dangerous strategy to rely solely on income from AdSense as a way of monetizing your site.

Selling products online

In previous posts I covered a number of different alternatives to AdSense. In this post I want to talk about a specific strategy - selling products yourself directly online. Now the first objection to this ( it was my own) will be - I don't have any products to sell so how can I sell products online?

One of the fascinating things about the internet is how it has created new business niches and markets or diversified traditional ones.

Retail and wholesale
Think for a minute about a traditional retailer. He buys wholesale and takes the goods to his shop then sells them at a retail price and keeps the difference.

Now think about purchasing goods by post. You buy from a retailer and the goods are posted to you. You are not even aware of their wholesale origin. Now imagine that you purchased those same goods by post and that they arrive but unknown to you it was actually the wholesaler who posted them directly to you on behalf of the retailer. Imagine that they did this in a way so that as far as you were concerned you were receiving your goods from the retailer. This is basically how dropshipping works.

How dropshipping works
With drop-shipping you, the retailer, advertise goods/products for sale. But you keep no stock of these products. When an order is made that order is passed to the drop-shipper who arranges delivery of the product. So you can act as a retailer but without needing to carry any stock.

I use this model very successfully on places like e-bay where I have an eBay shop. I make my sales on e-bay, classified sites and through a number of my own web-sites ( using free and cheap hosting)- but all the delivery and ordering problems are handled by the drop shipper. If you are interested in expanding your online portfolio from just AdSense enabled sites to direct selling and bigger bucks then this can be a very lucrative way to operate.

I mostly use dropship-business.com as they are reputable and have a large range of very high quality products at wholesale prices. Their start up packages are also very reasonable. As I have become more experienced I have added a couple of other drop-shippers for particular items.

This method of starting a real online business is certainly much less risky and much less hassle than trying to handle orders and shipping yourself and having to get things like a merchant account. Personally I have found that it works best when you market strong well known brand names and supplement these with more specialist items - but of course that depends what products you want to focus on.


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