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In the previous post of this series, we were looking at the concept: What is Drop Shipping? In this edition, we will look more carefully into the Best Practices of Drop Shipping. In 5 posts you will learn a lot about drop shipping. The best combination of theory and hands-on experience on doing drop shipping with for example China. Also you will get exclusive access to some great free and premium templates, forms and tools that will enable you to do drop shipping instantly and help you to do drop shipping successful.

In this part 2 of  What is drop shipping?, "Best Practices Drop Shipping."

Enjoy reading,

Team AllBusinessTemplates.com

PS: If you don't want to miss the other posts, subscribe to the drop shipping series newsletter:
   
               

Drop Shipping Best Practices

Drop shipping is a retail fulfillment method in which the retailer does not keep goods in stock but instead directly transfers customer orders and shipment details to either the manufacturer, another retailer or a wholesaler who then ships the goods directly to the customer.
In the retail businesses, the majority of retailers make their profit on the difference between the wholesale and retail price, but some retailers earn an agreed percentage of the sales in commission, paid by the wholesaler to the retailer.

1. Drop Shipping Success examples

Look for a great example how to run a Drop Shipping T-shirt business via Shopify:

from Shopify.

Below find more successful drop shipping companies. We start with the most famous one:

Alibaba
Alibaba is one of the largest websites in the world and one of the best parts of the site is that you can find manufacturers for your products. Keep in mind that you shouldn’t just type in the product you want to sell and contact the manufacturer. A part of their business is total fulfillment solution for their manufacturers: dropshipping. Also they provide Dropshipping manufacturers. To find dropshipping suppliers on Alibaba, you can fill in “dropshipper,” in the search bar (http://www.alibaba.com/products/dropshipper.html) then filter down to the desired product. Not all manufacturers on Alibaba offer drop shipping.

However, if you’re on a tight budget and you generate a quality strategy, drop shipping might just work well for you. They are basically doing a form of arbitrage with physical products. Find some example shops that operate successfully:

  • Movie-gadgets.myshopify.com
  • All-awesome-stuff.myshopify.com
  • Totoroshop.net
  • Funfinds.net
  • Nestoftheowl.com
  • Ilovecutebabies.com
  • Leogary.com
  • Outletuk.org
  • Barkoy.com
  • Bling-town.com
  • Fullforceimports.com

Drop shipping supports the existing physical business: it is also a very good addition to your current business. Suppose you are currently already selling physical products, it’s an attractive way to get more sales.

2. Drop Shipping failures


Do not accept resources with small margins
Ebay for example doesn’t allow you to solely do drop shipping, because margins of the products offered by the suppliers are too small. You can buy on 1 platform, and sell on the other. But don’t try to do buy and sell on 1 platform.

Aftersales issues when supplier is not reliable
It is highly important your supplier is providing the right products, for the right price and right service. If he is not shipping on time, you are responsible for the delay and need to pamper your customer. Make sure you have agreed about the service level you need from your supplier, and put this in a Dropshipping Agreement with the supplier.

Unprofessional online marketing and IT support
If your marketing and IT are not properly set up, you will be heading for a disaster. Successful Drop shipping highly depends on a slick web shop and attractive product range for the right price. Besides this, traffic is very important. Also the IT infrastructure must be working flawlessly, otherwise you will miss out on opportunities and nowadays with strong social media your company will be ruined within minutes…

Drop shipping supplier don’t ship frequently
Customers expect fast delivery nowadays. If your supplier is not able to produce or have stock, they
will not be a good partner. You need to be able to ship every day, not to miss out on opportunities!

Technical support
If issues may arise, your supplier should be able to quickly deal with the questions you received from the customer. Make sure your supplier can provide such service. It will be a quick end of your company, if you cannot answer your customer’s questions.

drop shipping strategy

3. Drop Shipping Handbook

Find a supplier through your network, in your neighborhood or by searching on Google, Bing, Yahoo, Baidu, Sohu, etc. Another very strong way to find suppliers of the products you are interested in, is to go and visiting trade fairs. Trade fairs are always focused on a specific industry, which makes it an efficient way to meet many suppliers of the same or similar products.

The ideal supplier to partner with:

  • Needs to be reliable and needs to produce quality products;
  • That don’t have a lot of business online yet;
  • They have to be open for innovative ways to do his business, and wants to outsource this online marketing tasks to you, and who will not try too;
  • When your supplier has your products on stock;
  • Then need be ready for growth for his company;
  • They are able to ship goods worldwide (much bigger market);
  • Needs to ship your product frequently, and max. once a week. This is important, because 
  • your customers wants to receive the products as soon as possible;
  • Has a showroom to show its products;
  • Can provide customer support for you, when you receive questions from customers;
  • Can pay your commission on a frequent basis.

After you selected the right supplier, and you worked out the Drop Shipping Agreement. The next step is to start business. After the first product shipments, you will find more issues that need to be solved in a permanent way. A good option is to develop a handbook together with your supplier(s). This handbook answers questions for situations or problems that might happen in the future.

A valuable drop shipping handbook can be found here: Drop Shipping Handbook.

Thanks for your attention! Subscribe to our newsletter not to miss the next edition of: “The Drop Shipping Expert Guide”.

In our next post we will be talking more about how to select channels and partners.

Related free & premium drop shipping templates:

  1. Drop Shipping Agreement Template
  2. Drop Shipping Handbook



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The next weeks we are writing a special about drop shipping. In 5 posts you will learn a lot about drop shipping. This can be especially useful when you want to start a web shop or want to create extra revenue streams within your existing webshop.

In 5 posts we will tell you all about the concept, strategy, best practices and more! The best combination of theory and hands-on experience on doing drop shipping with for example China. Also you will get exclusive access to some great free and premium templates, forms and tools that will enable you to do drop shipping instantly and help you to do drop shipping successful.

In this part 1 of  “What is drop shipping? The concept."

Enjoy reading,

Team AllBusinessTemplates.com

PS: If you don't want to miss the other posts, subscribe to the drop shipping series newsletter:
   
               

The Concept

Drop shipping is a retail fulfillment method in which the retailer does not keep goods in stock but instead directly transfers customer orders and shipment details to either the manufacturer, another retailer or a wholesaler who then ships the goods directly to the customer.
In the retail businesses, the majority of retailers make their profit on the difference between the wholesale and retail price, but some retailers earn an agreed percentage of the sales in commission, paid by the wholesaler to the retailer.

1. The drop shipping concept

So how this works? 

from Mark Jonas.


So what is the difference with your existing sales process?
The biggest difference between drop shipping and the standard retail model, is that the selling merchant doesn't stock or own any inventory. Instead, the merchant purchases inventory as needed from a third party,  this can be a wholesaler or manufacturer,  to fulfill orders. So:

  • No warehouse: inventory is at the supplier.
  • Not owning a logistic process: supplier takes care of the logistic process.
  • A broad product offering: instantly able to offer a wide variety of products on your webshop.
  • Quick time to market: be able to instantly start selling drop shipping products.
  • Reduce investments: No need to invest 1000's of dollars before able to start selling.
There are many companies offering drop shipping solutions. It is important that you select a partner that fits to your business model and geographical location. We will have a close look at some of those drop shipping companies in our next post. If you already want to know some of the best drop shipping services have a look at http://www.toptenreviews.com/business/internet/best-dropship-services/ and https://www.comparakeet.com/best-drop-shipping-companies/ .

2. Aligning your strategy for drop shipping

Before even thinking about drop shipping you should verify whether drop shipping fits within your existing business strategy. What needs to be done to be able to implement it?
  • Activities: Key activities/processes need to be implemented?
  • Partners: Which drop shipping partners?
  • Value: How to create (extra) customer value from drop shipping?
  • Customers: In which way drop shipping will influence customer experience?
  • Market: Do I want to broaden my current market or stick to a certain niche?
  • Channels: Which channels to use to enable drop shipping?
  • Costs & revenue: How drop shipping is going to create extra revenue and influence your costs? Is it financially healthy to do drop shipping?
It is best to start brainstorming about it before initiating drop shipping so that you are clear if and in which way drop shipping is going add extra value to your business. The "A3 drop shipping strategy model" can help you to cover all the topics. This template is ready to be printed on A3 paper, so it is easy to use during a project brainstorming session. You can download this premium drop shipping template using the link below.

http://www.allbusinesstemplates.com/template/NYHQT/

drop shipping strategy


3. How to create revenue with drop shipping

First of all, it is not that easy to generate revenue with drop shipping. When you run an online store that only offers drop shipped products, indeed you don’t have to worry about any inventory or product fulfillment. All you have to do is sell the products, take orders and make a decent profit. Sound to good be true? Yes it is. They're some things to keep in mind:

  • Are you getting the real wholesale price?
    "No", by default you are not getting a real wholesale price. Often dropship distributors charge extra fees and/or tack these fees onto the quoted wholesale price. Is that reasonable? Yes sometimes it is because the distributor is doing all of the work here and this will be certainly be reflected in your wholesale price. Make sure you know the prices and fees. For sure it helps when you compare multiple distributors to determine if the price given is fair. Negotiate with your suppliers and set up a WIN-WIN situation.

  • Shipping costs.
    When you are working with several distributors and a customer orders multiple products at one time, that are from multiple distributors, this will have a negative effect on the total shipping case. Why? This is caused by the fact the products will not be shipped within one shipment. Instead multiple distributors are shipping from different warehouses to the customer. The result is that you may have to pass these extra shipping costs onto the consumer which reduces your price competitiveness. (Also don't forget that is can be confusing for the customer.)

  • Keeping track of the shipping logistic
    Logistics can become a hell for you and your customer. The bullet above already gives you an answer why. A fully automated logistic solution with clear tracking can reduce this burden. Any human intervention is this process can cause extra administration costs. Keeping track of tracking, will be very important because you have multiple shipments that maybe arrive at different moments.

  • Who is responsible for customer service (CS)?
    Having as awesome CS is very important when you want your customers to trust you. But how this works when doing drop shipping. In the case of drop shipping your are not responsible for the fulfillment. So CS is partly out of your control. 

  • Is it more or less work?
    This really depends how you set it up. For sure no more logistics or inventory but what if your dropship warehouse or supplier is not reliable? What if they create a mess? Having clear & transparent contracts with them will be top priority. Also you need to automate as much as possible. Look for partners that do also.

So yes by adding drop shipping products you can increase revenue if you are able to market it to your consumers against a good price but you should keep close track of the extra costs and hassles. Ensure you make  include drop shipping into your financial plan/overview.

In our next post we will be talking more about partners, contracts and type of products. We will also have a look at some best practices.

Related free & premium drop shipping templates:

  1. Drop Shipping Expert Guide Blueprint
  2. Drop Shipping Strategy Blueprint
  3. Drop Shipping Agreement Template
  4. Drop Shipping Financial Planning



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Step 1: Check the local law first

Contact your local government or lawyer’s office to check the laws governing eviction proceedings in your jurisdiction Suggestion! If you are managing government-subsidized housing, check with local government for special regulations available for your case.  

Step 2: Know your rights

Get to know all the reasons that are accepted by law for evicting a tenant, which include:

  • violating the lease/agreement (pets, subletting, illegal use, etc);
  • breaking noise, occupancy, safety problems;
  • non-payment of rent;
  • causing significant damage to property;
  • health or safety hazards caused by the tenant.
Landlords often do not need a reason to evict month-to-month tenants, and they can choose not to renew a tenant's lease without giving a reason.  

Step 3: Don't evict on your own and take matters in your own hands

Do not attempt to evict your tenant by force, or try to get them to leave by cutting off their electricity, heat or water, changing their locks or taking their possessions. These “self-help” evictions are all illegal in most countries and you cannot do anything without a court order.  

Step 4: Create a paper trail This is important

It’s useful to have your documentation in order, including a copy of the lease, written notices you have sent to the tenant concerning any problems, and any other proof to support your claim, like bounced rent checks or photos of property damage.

Send Notice to pay rent

Send Formal Notice to Terminate Rent

Send Notice to quit for Non-payment

Step 5: Give them fair notice

Let the tenant know in writing that you are planning to evict them if they don't pay their rent or correct a violation by a certain date. How much time you must give them varies from state to state. Suggestion: If you are evicting a month-to-month tenant without cause, make sure you are giving the advance notice required by local government, which is often in-between 20 to 90 days.

Step 6: Go to court

If the tenant hasn't addressed the problem within the time frame you mentioned, file an eviction notice with the local court. If the tenant does not reply within the number of days defined by the local court of law, you will win by default. If the tenant challenges the eviction procedure, this case case may go to a hearing.

Send Formal Eviction Notice will be filed in Court

Step 7: Post a formal Eviction Notice

If you are in the situation you win the case, a representative of the court will post a notice on the tenant's door which is giving them a date they have to be moved out the premises, at which time the tenant and their possessions will be forcibly removed from the premises by the court representative if they haven’t vacated on their own when the deadline comes.

Important to mention in the Formal Eviction Notice:

  • mention a deadline (date) to “pay-rent or move out”;
  • mention the amount owed (including all fees);
  • you are typically required to post this notice within certain number of days before filing the eviction paperwork with your local court;
  • this document should be taped to their front door, and sent via Certified Mail service provider that can give you a Return receipt;
  • make it easy on yourself – use a state-specific eviction form template;
  • after all this, it's their turn to respond.

Send 7 day Eviction Notice letter

What happens if you might loose the case?

The negative side is, if the tenant wins the lawsuit, you will have to let them stay and also pay their legal costs of fighting the eviction, in most cases. So be sure to follow the law and leave a paper trail as mentioned above, before starting proceedings! Please note that if you take matters in your own hands, you will be on the wrong side of the law and will get yourself in big trouble.

To prevent yourself from all this, make sure you are following our guidelines and start leaving a paper trail by for example downloading our templates. We wish you good luck and truly hope we helped to save some of your time.

Please download several formal notice letters on AllBusinessTemplates.com now:
Formal Eviction Notice Templates. Suitable for every landlord in the given situations:

Learn more how to evict a tenant:



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You have your own restaurant, pub, cafe, hotel, etc and are not sure how your guests really experience their visit at your venue? We have come across this very comprehensive Mystery Dining Template that is compiled by top-consultants and hosts in the Mystery Dining Industry, and is now accessible for you: Mystery Dining Report Template.

Mystery Diners (or Secret Diners, mystery shoppers, etc) are people that volunteer and offer their time to visit your restaurant and return a detailed Mystery Dining Report of your restaurant, hotel or pub experience, and who will be reimbursed for most of the cost of the experience in return. Often this experience is shared by a small group of for example 2 to 4 persons, so you get the chance to learn more from more than 1 person. They often debate their experience after the visit.

The Mystery Dining reports are paid for by yourself, as a hospitality operator, and you will see this feedback is invaluable in understanding the real experience in detail from a customer's perspective. Exactly what you need to incrementally improve your customer satisfaction. These Mystery Diner Reports are also suitable to assess your personnel’s performance and to improve your standards and rewards to well-performing staff.

On AllBusinessTemplates.com we provide a professional in-depth Mystery Dining Report Template. It is used by well-known brands. This Template can be of service when you want to grow your sales by gaining more insight in your brand reputation and customer experience. This report is suitable to measure the service performance of your restaurant, hotel, cafe or pub by letting an anonymous Mystery Diner perform an assessment on your venue.

This 10 pages Mystery Dining Template has about 80 easy to fill in in-depth questions, and covers the following sections:

  • Reservation Skills 
  • Lounge 
  • Service 
  • Food and Drinks 
  • Service Recovery 
  • Environment 
  • 10 Important Moments
  • etc 
After downloading, it’s easy for you to adapt this template, or to add extra sections to personalize the template to your restaurant, pub or hotel!   

Please download the Mystery Dining Report Template on AllBusinessTemplates.com now:
Mystery Dining Report Template. Suitable for every restaurant, pub, cafe owner!

Learn more how Mystery Dining actually works:

View Mystery Dining Report Template

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We have come across an easy to use template to perform Social Audits yourself on your Manufacturers and Suppliers, that was compiled according the SA 8000 Standards of Social Accountability. (see source in template: Social Audit China Social Accountability 8000 Template).    

By performing Social Audits (for example according SA 8000 standard) you are able to improve your Corporate Responsibility by implementing Social Audits at your factories. This specific SA 8000 social audit template is already in use by several Social Auditors in China.

Corporate Social Audits (SA 8000) in China and Asia
Certified SA 8000 auditors have experience in Corporate Social Responsibility Audits (SA 8000) and they can check the factory according to international standards, including the SA 8000 standard.

This Corporate Social Audit (CSA) will allow you to:

  • demonstrate to your clients and environment that you are socially responsible company.
  • be proactive about sustainable development.
  • avoid factories with dangerous working conditions, child labor etc.
  • know the gap between your vendors status and the SA 8000 certification standard.
  • make correct comparisons between your vendors.
  • save time and secure your business!
  • of course our Social Audit Template enables your inspector to write suggestions for improvement. Many customers and factories enact corrective action plans after an initial social audit. The implementation of the corrective action plan is the first step towards achieving the SA 8000 certification.

Please download the Social Audit Report Template on AllBusinessTemplates.com now:
Social Responsibility Inspection Report Template. It's currently available in English language.

Learn more how Social Auditing actually works:

View Social Audit Report Template