Home – New Forums Logistics Using Dropshipping in Australia – how it works

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  • #978940
    kimbagirl
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    Hi everyone…just wondering if anyone has any experience in using drop shipping for their on line business? I want to start a new biz and had a few questions…How did you source the right manufacturer to deal with…are overseas or Australian companies better…how did you learn the ropes? I am trying to find a supplier of good quality wooden toys preferably for drop shipping as I don’t have a lot of capital to invest in stock atm.

    #1110851
    ABC
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    Hi there. Never done it myself – only information I have seen is in the Tim Ferris book – 4 hour work week. I think if you can get it to work, it does sound like an efficient way to go – lower working capital and simpler.

    Good luck
    abcvic

    #1110852
    NickHumphries
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    I have used services in the past for previous business ventures like Alibaba – just be very careful..

    #1110853
    Johny
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    I have not used dropshipping services, but I can offer some comments that hopefully may be a little useful.

    Firstly, and talking about overseas suppliers, it is very, very rare that an actual manufacturer will offer drop shipping services. The reason being that factories are designed for bulk manufacture, often without the capacity or infrastructure to be offering single lots for sale.

    It is therefore most likely than any dropshipping company will be a company that sources product from several manufacturers. This is not necessarily a bad thing as the supplier can have better buying power, but you will not get factory prices.

    One trend coming from supposed dropshipping companies in Asia (China/HK especially) is that they will not hold any stock and will only buy stock on receipt of an order. Therefore this has shown to be a real problem with customers getting goods delivered in reasonable times.

    The obvious advantage of dropshipping is that you don’t need to have lots of space or capital to buy and hold stock.

    Also, having seen what some wholesalers make ouf of some products in Australia, there is potentially some upside in being able to buy product at good prices, and onselling at a competitive price, depending on the types of product you may purchase.

    Having said that, there are also disadvantages such as:-

    1. You need to spend a lot of time shopping around looking for the right dropshipper. There are horror stories everywhere. I know of 1 dropshipper of electronics (tablets and stuf flike that) who constantly gets good feedback and one dropshipper of branded products in Hong Kong that seem ok, but thats all, over a long period of time in the buying/selling business.

    2. You lose control of the transaction. This would be a big factor for me in having someone else providing a product I have sold where I have no control over the product or timeliness of delivery

    3. Get the wrong supplier and your returns wil cost more than you make in sales, and if you are selling somewhere like ebay where customer ratings are all important, you are finished before you even start.

    4. In some markets on places like ebay the supplier may also be your competitor selling the products directly themselves.

    Sorry, some negative comments in there, but like everything else, there are opportunities, just need to spend the time and effort to make sure of everything.

    #1110854
    Divert To Mobile
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    My experiences with Alibaba have been less than satisfying.
    I also know of a company in China made up of one person and has a listing verified to have thousands of employees. I dont know how that happens but dont take everything at face value.

    Steve

    #1110855
    simonw
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    Don’t expect to make good returns on items you are drop shipping. reason being there are probably hundreds of other sellers flogging off the same products, and in a marketplace like eBay there is always someone happy to sell it for less than you.

    Drop shipping should only be used to gain some experience and build your capital to buy items at wholesale.

    Alibaba has some gems, and some scammers. I have bought from both. If you want quality suppliers, fork out the money for subscriptions to Salehoo and WorldWideBrands

    #1110856
    ExecAccess
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    I guess it depends on what you are looking at drop shipping and where from.

    We have found that few suppliers will actually drop ship, but if you do have supplier/s who will then you need to have a high level of trust in them, their product and their service.

    Only one of our suppliers will drop ship. They are an Australian based supplier and we have been working with them for 2 years now without a single issue.

    We are an online business so as soon as we receive an order for one of their products, we send them an order by email with details of the product required and the delivery address. They despatch generally within 24 hours (and mostly the same day) and invoice us for that individual order plus the cost of shipping. The supplier does not include any of their own paperwork with the order, just a one pager we have supplied thanking the customer for their order. We email the customer an order confirmation.

    Our only issue has been that as a manufacturer they close for two weeks over the Easter period and about 4 weeks over the Christmas/New Year period which means we cannot fulfil orders for their products during this period.

    #1110857
    MH08
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    I’ve heard of dropshipping businesses work really well + with alot of hardwork also, but I think a good method would be to try and pre-sell the product.

    I think find out how quickly you can get the products to where ever you are first, and use that as leverage, but you have to make sure you have it well planned out, if your trying to bring in electronics/jewellery/clothing maybe try and get a source where you can get a contract in an actual store so at least you have a stream of income coming in.

    If your product delivery time is estimated 1 week, make it 2 weeks to get delivered to the customers so you can get it landed here in time, so maybe everytime you sell 5 products off, you order 10 instead so you spread your risk a little more and grow slowly slowly. Find out whats the minimum order you can get when discussing the price your happy with.

    Even invest around $5k – $10k in the product, I know of many people starting these types of businesses with no money down, off the back of a credit card and pre-selling is one of there secrets.

    #1110858
    Zava Design
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    I did quite a bit of research into dropshipping a year or so ago, and from the figures came to the conclusion that it just wasn’t worth the effort. Because it’s so well known now, and Ebay used by so many sellers, it’s almost impossible to find any dropshipped product that will provide any sort of reasonable return.

    My advice would be to research and source a single item, one that sells well on Ebay for example, and can be purchased in bulk for a price allowing for a decent profit margin. If it’s small in size then it shoudn’t be a problem storing in a normal home or apartment, and to actually ship yourself. I’ve identified a couple of items like this that I am doing some Ebay trials with.

    And it doesn’t need to involve much money up front. One of the items I’m trialling I will only need to spend around $900 up front, with the potential to make over $5000 in profit.

    Cheers.

    #1110860
    arrowwise
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    We have had many foundation years with various drop shipping suppliers. Just remember that no one else will handle shipping better than you or your staff out of your own stock and premises you have full control over.

    When push comes to shove once items have return issues, delays or lost shipments etc it’s always more difficult to resolve with a third party in the middle.

    Don’t get me wrong we still do a lot of drop shipping, but unless you have partnered with the drop shipping company that operates as though they are part of your own team to your exact service and quality levels – it’s a tread very carefully business model.

    #1110861
    RodBartley
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    kimbagirl, post: 123330 wrote:
    Hi everyone…just wondering if anyone has any experience in using drop shipping for their on line business? I want to start a new biz and had a few questions…How did you source the right manufacturer to deal with…are overseas or Australian companies better…how did you learn the ropes? I am trying to find a supplier of good quality wooden toys preferably for drop shipping as I don’t have a lot of capital to invest in stock atm.

    Hi kimbagirl,

    Not all wholesalers or manufacturers offer dropshipping. Dropshipping is very appealing for start-up home based-businesses today because you don’t have to worry about storing and shipping your products. As a seller, you can sell several products without worrying your stock inventory.

    A real dropshipper is simply a certified wholesaler who offers dropshipping. It is difficult to find a genuine one who will dropship and work with online sellers. If you are looking for a wholesaler or manufacturer who offers dropshipping try to visit http://www.worldwidebrands.com. They have a directory of certified dropshippers.

    Cheers,
    Rod

    #1110862
    GlassHalfFull
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    Johny, post: 123467 wrote:
    Also, having seen what some wholesalers make ouf of some products in Australia, there is potentially some upside in being able to buy product at good prices, and onselling at a competitive price, depending on the types of product you may purchase.

    Hi,

    Just wondering if you could elaborate on this? I’m going into the fashion industry and I’m curious about how much distributors actually do mark up products.

    #1110863
    jesterx
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    GlassHalfFull, post: 190995 wrote:
    Hi,

    Just wondering if you could elaborate on this? I’m going into the fashion industry and I’m curious about how much distributors actually do mark up products.

    Alot of peopel do drop shipping all the wrong way. They go to an online person, send and email and set it up over email.

    NOPE! wrong way.

    the right way, well…I tested a few ways, the way we did it was to go overseas, make friends, and find out all sorts of things about prices, postage, volume and if you make friends they will end up over volume and even give you free things, yes, at no cost.

    You will find out about quality, conditions, face to face is the best. You can also handle the product find out who is doing well, and why and they are willing to give you secrets no one else will give away, if they trust you, and know you will become a long term partner.

    Anyone selling online can do drop shipping, the way we did well, was to visits shops, manufactors, study competitors and learn the process, set up deals, relationships and then go nuts selling the product.

    We took a $50 a day profit business into a $xxx,xxx month business doing this, and the deals, and personal contacts we got were just incredible. All from a 2 week visit overseas. The offer and experience you get by doing this, is well…..like getting a PHD in dropshipping, not just calling yourself a drop shipper middle man as such. …… its much better. And the financial rewards are insane if you are willing to put the hard work in. :-)

    #1110864
    Cats
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    GlassHalfFull, post: 190995 wrote:
    Hi,

    Just wondering if you could elaborate on this? I’m going into the fashion industry and I’m curious about how much distributors actually do mark up products.

    We have just been approached by someone with an online store wanting to know if we will do drop shipping for her. To date, we hadn’t done it but we are giving it a go. Why not.
    In terms of a Distributor, the mark up can be very different from one company to another. Some Distributors get 35% whilst others can even get up to 100%.

    #1110865
    sarjit
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    arrowwise, post: 190500 wrote:
    We have had many foundation years with various drop shipping suppliers. Just remember that no one else will handle shipping better than you or your staff out of your own stock and premises you have full control over.

    When push comes to shove once items have return issues, delays or lost shipments etc it’s always more difficult to resolve with a third party in the middle.

    Don’t get me wrong we still do a lot of drop shipping, but unless you have partnered with the drop shipping company that operates as though they are part of your own team to your exact service and quality levels – it’s a tread very carefully business model.

    can i know about your drop shipper details?

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