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    1. Plunky97 is offline

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      #1

      How to choose between Manufacturers and Dropshippers for sourcing?

      How do I decide what’s best for my business—sourcing only from a manufacturer, or using a drop shipper instead?
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    2. Rocky78 is offline

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      #2
      First, it’s good to know the difference between the two.

      Manufacturers are basically companies that produce what they sell. Either they produce goods for their own company, having their own name brand, or they produce items for other businesses to sell. Either way, they actually make the product from the raw materials.

      Drop shipping is simply an arrangement between you and a manufacturer or distributor, in which they take care of packaging and shipping the products that you sell to your customers. Basically, you sell the product and they ship it out to your customers.

      Knowing this, there are obviously many benefits to drop shipping:

      • First off, you don’t have to pay for anything until you sell it. The customer’s money covers the cost that you incur from the manufacturer/distributor, as well as any extra to you for being the middle man.

      • Once an order is made for your company, all you have to do is contact the drop shipper with the appropriate information and the shipment is on its way.

      • You don’t have to deal with the hassles of fulfilling orders. Drop shippers already have the process streamlined and are happy to put your company’s labels on the products they make/distribute.

      • There’s no need to keep loads of inventory in your basement or storage facility. In fact, your entire inventory is kept with the drop shipper until sold. This helps if a particular item loses its selling power—you are not stuck with something that won’t sell.

      • There’s no worry over ordering and keeping inventory in stock. As long as the drop shipper has it, you have it as well.

      • Drop shippers are transparent. The customer will think they’re getting a product from YOUR warehouse, simply because it has your own label on it.

      While all of this may sound good, there are a couple of things you should consider before going with any drop shipper:

      • While you may be getting a deal on the manufacturer or distributor’s products, you won’t be making as much money since you’re essentially counting on them to do all the dirty work for you. Shipping costs money—bottom line. Your profits will be substantially higher if you took care of the shipments yourself.

      • Your company will be at the mercy of whichever drop shipper you choose to go with. While YOU might be pertinent about getting customers’ orders fulfilled in a timely fashion, you’re depending on the drop shipper to do the same. Plus, you’re counting on them having everything you need in stock and ready to go.

      Whether or not you go with drop shipping depends on what level of control you are both able and desire to have over your company. Drop shipping can be very beneficial, if you weigh your pros and cons.
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    3. Plunky97 is offline

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      #3
      Perfect explanation. Thank you so much for your time, I really appreciate your help.

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