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    1. Digmen1 is offline

      Join Date
      Oct 2011
      New Zealand
      New Zealand
      1 Time in 1 Post

      What markup should I offer as a manufacturer on our drop shipped products?

      Hi Guys

      I am a manufacturer.

      I was wondering what sort of markup sellers like to make on drop shipped products?
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    2. WholesaleMod's Avatar
      WholesaleMod is offline

      Join Date
      Dec 2010
      United States
      United States
      437 Times in 390 Posts
      Hi Digmen1,

      Welcome to Wholesale Forum

      We could say 30-40% of the retail price, however that would be imprecise. There are many factors you need to consider when pricing your products for retailers, factors which are product and market specific.

      Every reseller wants to maximize profits, but as a manufacturer you have many ways of offering them that opportunity. If your products are fast sellers, you could offer them at a low margin per unit. If however the products are high price tag slower selling goods, you can maintain reseller interest by offering a high margin.

      You should also consider that if you make your products available to too many resellers, they are more likely to come in competition with one another, undercut each other on price, and express a discontent about the low margins you are offering them. Being selective about which resellers you take on board could turn out to be a more important decision than pricing. You should use pricing to achieve a balance between optimal retail coverage and satisfaction of your resellers and end users.

      Statistics would suggest that, to maximize profits, you bear less risk by choosing only resellers that are already able to shift large amounts of stock. However our advice is to also consider accepting start ups that show potential; some of them will become very successful long term, and it would be a mistake to ignore them.

      To get as much exposure to as many resellers possible, we recommend you register with the largest online trade directories of verified drop ship suppliers eSources, Wholesale Deals and Worldwide Brands. Thousands of resellers use these directories to find verified drop ship suppliers to build up a profitable business relationship.

      The average % of markup differs from one product to another, if you want to share with us which products you are selling and want to get more information about those specific products, feel free to post a reply in this thread

      Hope this helps
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