Drop Shipper Guidelines
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How to determine if the drop ship program is good.
Here are some things to check when researching a drop ship distributor.
1) You need to be sure that the company will drop ship the product!
Many times, you find a company listed as a “wholesale distributor”, but they will not drop ship. You have to purchase in bulk, and then ship the products yourself. While this is an acceptable method (it has been in practice for hundreds and hundreds of years) it is not our goal. If you come across a company like this, email or call them and ask if they will do drop shipping. Sometimes the company will do drop shipping, but they don’t advertise it.
2) The company should not charge you a fee to become a reseller of theirs.
There are a VERY few genuine drop ship wholesalers who DO charge a SMALL account setup fee (less than $40.00, for example), and it’s legitimate. Some of these companies provide extra services and value to your business, such as:
- Custom shipping labels they may print for you.
- They may set you up with access to a special administrative area on their web site, where you can track your orders and shipments.
- They may set you up with real-time access to their database of available stock and “quantity on hand” of their products.
All these things cost the wholesaler money, so they may legitimately charge a fee to set up your account.
However, this is VERY rare! 98% of the “drop shippers” on the Internet who charge Account Setup Fees ARE middlemen!
3) Beware of fees for minimal orders.
Some companies charge you a small fee (usually in the $5.00 range) if your order is less than $250 or so. This is to cover the extra handling of the product. Just be sure you are aware of this cost, so you don’t end up loosing money on a tight sale.
What sort of payment plan does the company deal with? Do they only do pre-payment via credit card? Do they do Net 10, or Net 30? You need to be aware of this, since you have to pay the drop ship distributor. What method is best for you? What method is best for the drop ship distributor? Many companies will start you out on a pre-pay system (you have to pay them via credit card before they will ship), but they will eventually move you to a Net 30 plan once you have proven yourself reliable.
For more information on fees and choosing a drop shipper, I recommend you read the FAQ’s and ScamWatch found at the Drop Ship Source Directory.
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