When you set out to sell online and turn this into a substantial growing business, you probably think that nothing can go wrong. You search for tools and business models that can help you to be successful, and some work tremendously. If you are good at what you do then you likely do research and you will find that there are some things that work and others that may not be as effective. One specific business model or tool that is said to help your business but which has mixed reviews is the drop shipping model. If you are a business owner selling on eBay then you want to know all of the facts.
In theory this is a great practice but you have to break it down. You are taking the middle man out of the equation and ultimately working to ship things quickly so that they arrive to the customer without any issue. The idea of drop shipping is that your customer can get the goods that they want directly from the wholesaler, thus taking the retailer or traditional distribution channel out of the picture. This sounds great in theory but the problem is that you don’t necessarily know how the drop ship element will work. You can end up with missed deadlines and products not arriving as they should, and thus this can cost you some business.
Many Find No Positives About This Business Model So Know That Going In
As with any aspect of running an online business you have to do your research. If there is a drop ship function or partner that you can trust then that’s one thing. The problem lies however in not quite knowing how this will all work, and that uncertainty and taking the middle man out can be problematic. When you drop ship directly to the customers you take out a certain element of trust within you as the seller. If you know what you’re doing and you are working with those well adjusted to the drop ship model then it may work. If however you are just taking chances and therefore hoping that the products arrive, then be aware that this may backfire.
There’s a reason that so many online sellers absolutely hate the drop shipping model on eBay or on any other site that they have worked with. It all too often hurts their business and ends good relationships because it leaves too much up to chance. If you really want to try it out then go on a much smaller scale and see how it may work from there. The end result should be that drop shipping is a good thing for your clients and your business, but going in knowing the true drawbacks of this business model is important. You can make educated decisions and ultimately work through this to see if it’s right for you, though these downsides as spelled out here may help to make the decision for you!
Know Before You Head Down This Path
Though you have to make your own decisions based on what works best for our business, there are some things to know going in here. You may not necessarily have this experience, but these downsides seem to be shared universally and so you may want to look into something else besides drop shipping when working on eBay.
• You relinquish control which can be a very scary thing: You are no longer in control of what inventory gets to the customer or how it all works. You no longer get to decide how quickly it will turn around, and therefore you are relinquishing all control over the most important part of the transaction. If you have a trusted method for drop shipping then it may work, but this is not usually the case. If you are new to eBay or if you have a lot at stake, then you want to remain in control. That means that you ultimately must stay away from drop shipping if you are worried about how the goods arrive to the customer. Cutting this control method out can cost you dearly, and it just might not be worth it in the end!
• This does not follow the traditional distribution channel and that’s not always good: Though some traditions are made to be broken, this may not be the time to try t out. Oftentimes having the traditional distribution channel including a third party retailer interface works well—so many will say don’t mess with something if it’s not broken! When you follow this nontraditional shipping method it may not necessarily be the best bet for your business. Be aware that many others have tried this before you and have had horrible results. Sometimes sticking with the traditional way of doing things benefits you greatly!
• You can’t ever be sure if your goods are actually shipped or arrive in time: If you remain in control over the entire process or have a retailer who is well versed in this then you know how the shipping process will work. If however you take yourself out of the picture and you leave it up to chance in this way, then you have no clue how it will really work. You don’t know what goods will really ship, nor do you know how or when they will get there. It’s simply not worth the risk or having to cross your fingers every single time that you want to ship to clients. If you are established then you might want to try it for a couple of simple transactions, but leave it at that to see how it works. Don’t leave too much up to chance and therefore hurt yourself in the process!
• If there are continued problems it may cause your account to be suspended: All too often you may run out of stock and find out too late. This could come your way even after you have a customer transaction, thus leaving you in a really bad position with a very unhappy client. Don’t let this happen! If it happens too often, if you get enough negative reviews, or if you are deemed as unreliable this may even cost you your eBay account which is never a good thing. The whole way that you do business depends upon positive reviews on eBay, and if you want to protect that and keep your account intact then by all means be sure to avoid drop shipping as it’s just too uncertain for your business overall!