Start a Drop-shipping Company

 Drop shipping is when a supplier offers products to sell to a third party. The advantage of this arrangement is low risk, virtual store front and the shipping is done by the supplier.

Your primary duty is to attract customers to the product and secure a sales order.  The basic principle of drop shipment is applicable to many products.

Some products are easier to package and ship than others. Therefore product choice and niche is essential to drop ship success.

Steps to Starting a Drop Shipping Business

• Choose a niche
• Select a product
• Identify your competition
• Find top tier shippers
• Build your drop shipment website
• List products
• Generate traffic
• Register the business name
• Secure drop ship agreements
• Terms and conditions
• Payment channels
• Social media marketing

Develop the Business

To develop any business you need to invest lots of time and effort. You need to learn the fundamentals of drop ship business.

Understand your customers needs and preferences are important. Develop the skill through learning, online courses, seminars and apprentice programs.

First time investors should focus on a niche market and start small. You can successfully run a drop ship business part- time and become full time as business increases.

Things to consider are marketing, customer service, quality goods and develop a profitable business plan. The equity value and brand of your business increases with time.

Drop shipping is moderately challenging so you need to have realistic expectations. The business also requires 100% commitment and transparency.

How to Select a Good Niche

The niche market you choose can make or break your business. Things to consider include low competition niche and drop ship fees.

The supplier charges per item based on the distance, weight and other parameters. The niche should be deep and capable of assuring high profit margin on low volume sales.

To find a niche, conduct a search of different products. Use Google keyword planner to find low incident keywords that attract less competition.

You can conduct a search on Amazon and research social media platforms. Popular social media channel to consider are Reddit, Facebook, and YouTube. Once you decide on a niche the next step is to find suppliers.

How to Find a Drop-Ship Supplier

The niche will determine the supplier you need. Not every niche has a credible supplier so you need to keep your options open.

The best way to find suppliers online is to use search operators. Use the item plus keyword to narrow the field.

Focus on your preferred keyword and mix and match. Using this method on Google search tool will bring up possible suppliers in your chosen niche.

The next step is to analyze the result and focus on the company profile and services. Send letters to your preferred suppliers for drop ship deals.

Make sure you conduct serious due diligence before committing to any agreement. Find out the credibility of your partners before signing up.

Open an Account with the Supplier

To operate a drop shipment business you are mandated to open an account. The supplier would provide two options opening directly on the website or opening a wholesale shipping account. The account is very important for remittance of funds to the shipper once an order is made.

 Account Opening Conditions

Although the conditions vary according to shipper there are some similarities. You would need a resale license, tax identification and submit company name.

Incorporate the Business

Incorporate the business as a sole proprietorship or limited liability company. Get an employer identification number and sales tax exemption permit.

Starting an Online Drop Ship Business

You need an e-commerce store to sell the items.  Create a brand and select a top domain name.

There are a few successful drop ship websites selling good quality stuff. To start your online investment considers developing the website yourself.

The less involvement of web developers and marketers equates to more funds and better profit margin. Before starting the business you need to incorporate and get insurance cover.

Secure a top domain name and pay your host plan. Then partner with a trustworthy supplier to carry out the shipment.

Make sure your website is optimized, scalable and easy to navigate. The website needs a shopping cart and checkout for purchases and orders.

Places to create a simple store include Shopify, Wordpress and blogger. Use a premium template and create relevant pages.

Select the appropriate products for sale and offer reasonable prices. Make sure your website has a product pages, about us page, contact us and privacy policy. Other pages are terms of service, returns/refunds and shopping cart.

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Payment Channels

Introduce different payment channels to optimize the website. You could introduce a checking account, PayPal or credit card payment. Collect sales tax and shipment charges.

Promote the Business

Promote the website through social media channel. Popular channels are Instagram, Pinterest, Google+ and FaceBook.

Don’t forget to introduce important apps in your store. Make test purchases to make sure the website is functioning properly. Promote the store through FaceBook advertisements and content marketing