B2B furnishings made easy

What is Dropshipping?

Dropshipping is not a new term, it has been around for quite some time. But there are also misconceptions on what drop shipping really is. We know dropshipping and we understand it. We have been dealing with thousands of legitimate drop ship suppliers for years.
Dropshipping is a service offered by (some, not all) Wholesalers. When you use a Wholesaler who offers Drop Shipping you don't have to worry about stocking or shipping products. Instead, when you get an order from a customer, you contact your wholesaler and they ship it to your customer for you. This means you, as a retailer, can sell a variety of products without ever having to stock any inventory whatsoever. This makes drop shipping very appealing for new, small, home-based online businesses.

How Drop Shipping Works:

No matter where you plan to sell products online (eBay, Amazon, Rakuten, Sears or even open your own online store) if you are starting a business selling products from home then you probably don't want to carry much, if any, inventory. Most people who are starting their first online business via auctions or online stores don't have a lot of money to buy a bunch of products or the space to warehouse and store the products they want to sell online. This is where working with a real Dropshipper will save you a ton of money. As stated earlier, a real Dropshipper is simply a Certified Wholesaler who offers dropshipping. Not all wholesalers offer dropshipping. In fact it's quite difficult to find genuine certified Wholesalers who will dropship and work with online sellers. For online sellers, working with a Dropshipper is pretty easy. You find the Dropshipper you want to work with (the one who has the products you want to sell.) They will then give you access to their product images so that you can post them on your website, auction, blog or however you plan to sell online. When a customer orders the product, you then order the product from the Wholesaler and they ship it to your customer.

Pro's & Con's of Drop Shipping

Using a certified Wholesaler that dropships is a low-cost solution for people who work from home, don't have money to spend on inventory and want to sell products online. Drop shipping does work and it works very well but you do have to be careful with a few things. First, you can't just sell any product you want and expect to be able to compete with drop shipping. When you have a product dropshipped, you are buying and selling 1 product at a time. That means your wholesale price is for 1 product when you have it dropshipped. Wholesalers always give discounts to retailers when they purchase in bulk. That means your wholesale price for 1 product (drop shipped) can be higher than a competitor who is buying in volume from the wholesaler...which means they can sell that product much cheaper than you can, and in some cases, even cheaper than your wholesale cost!

So how can drop shipping work?

Easy. You have to pick the "right" products to sell; the right kinds of products to dropship. You can't assume that just because you might think a product is a 'good idea to sell' that you should jump in and start selling that product. Especially with dropshipping. Doing a little bit of market research before you start selling is critically important. You have to find the products you can have drop shipped that you can compete with in the current online market. But by doing a little bit of research first, you can be very successful with dropshipping!

The Pro's of Drop Shipping:

  • You don't have to buy or store inventory
  • Very Low Startup Cost
  • Easily Add or Change Up your product offerings

The Con's of Drop Shipping:
  • Not all Wholesalers offer dropshipping
  • Wholesale Cost is based on 1 product only
  • Must spend time researching to pick the right product(s) to sell

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Does OceanTailer drop ship products?

Yes , OceanTailer drop ship products for the products owned by OceanTailer. For the rest, we leave it to the seller to decide on their business model.

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Do I have to set up an account with each supplier or does becoming a buyer member of OceanTailer automatically qualify me to work with all the wholesalers you list?

We are not a middleman. We verify the wholesale product sources for our members. Then it is the member's responsibility to search the Product Sourcing Tool for wholesale suppliers that carry the products that the retailer wants to sell. Our members must contact the supplier they want to do business with, and setup an account directly with the wholesale supplier to obtain the best wholesale pricing.

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Do I have to buy more than one product?

With dropshipping, you are not buying the products upfront. So it doesn't matter the number of products that you list for sale. With the light bulk suppliers in our database, they have minimum total order value or a min units to order based on case pack, so you can keep your own inventory for better profit margins.

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Do I have to pay for the product before I sell it?

With dropshipping no. The supplier will be sending the product on your behalf to the end customer. You will pay for the product once a customer orders from you.

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Do I have to pay the supplier a membership fee too?

It might be that if you go direct, you will need to pay membership fee. Other directories of suppliers will request you to pay them membership fee. We won't ask you of that. The data is given for FREE!

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What is a drop ship fee?

A drop ship fee is also called a "handling" fee. This is the fee to pay the wholesale supplier to split apart cases and pack one product to send to your customer.

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How much is the drop ship fee?

If there is a drop ship fee, they typically range from $1.00 to $5.00. Sometimes you will see a higher drop ship fee, which is understandable once you see the type of product that will be sent. Delicate products take more to pack and ship them, so the extra cost has to be charged in the drop ship fee.

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What kind of profit margins are there with dropshipping?

This all depends on the products that you source and the supplier that you work with. All wholesale suppliers have their own wholesale pricing structures. However, we here at OceanTailer do our best of efforts to bring you the lowest price possible.

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How do I get images and descriptions of the dropshipped products for my website?

We do the heavy duty work of collecting this data for you, and we will provide you with all the images & product descriptions that you will need to sell the product(s).

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Does Ocean Tailer offer integration feature, software CSV files or data feeds to list the products or make the ordering process automated?

Yes, Ocean Tailer do offer data feeds. Currently we support XML, CSV, and Tab Delimited. In the future we will enable integration with all major marketplaces and eCommerce systems.

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Can you use a drop ship supplier and sell on eBay or Amazon?

Assuming that wholesaler is not prohibiting it, you can use dropshipping to sell on eBay or Amazon. eBay & Amazon are good places to test the product market to get more instant results. It is difficult to compete on eBay & Amazon, so it's best to purchase in light bulk quantities to sell on the eBay/Amazon platform. You will get even better pricing by purchasing wholesale products in this manner, and you will have the control over your shipping so there will not be an issue with feedback.

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How do I know the product will still be in stock by the time I sell it?

We provide real time inventory through our datafeeds. We urge our suppliers to update their inventroy on our platform as soon as there is change so it will be propagated to you immediately right after.

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Why does Dropshipping cost more?

Dropshipping wholesale prices are higher, because you are buying one product at a time. Bulk discounts occur when you can purchase the required minimum from a wholesale supplier. The more you buy, the higher the discount.

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Why don't all suppliers offer Dropshipping and Stocking of Goods?

Dropshipping and Stocking of goods takes extra time and manpower. Many wholesale suppliers are not willing to do business this way and it will increase their overhead. OceanTailer provides you both the facilities of stocking of goods as well as dropshipping.

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Do I need a Tax ID to work with a dropshipper or with OceanTailer?

Yes of course! We need to ensure that you are legit business. However, This makes the products non-taxable to you, but you can tax your customers. Getting a tax ID isn't hard, it's actually quite easy. For US retailers, please click here; and select your state. This will take you to a State Government page on how to register a business and/or get a tax ID.

Will the dropship supplier use my company information on the shipment to my customer?

Many of the listed wholesale suppliers will send the product in your name, or they will blind drop ship, so the customer doesn't know exactly where it came from.

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If I give my customer's information to the dropshipper, couldn't they steal my customer from me and cut me out of the sale for any future purchases?

A wholesale supplier's business is selling to retailers, not the end consumer. Some wholesale suppliers have contracts you can sign that will state they will not market to your customers.

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How are returns handled? Do my customers ship the products to me or the supplier?

This will vary from wholesale supplier to supplier. Each has their own rules on returns. You will have to adhere to the wholesale suppliers policies.

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What is Blind Dropshipping?

Blind dropshipping is when the wholesale supplier will use a return label that reads something like "Fulfillment Center" or "Shipper" as the business name.

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How do I figure out how much to charge for shipping when using multiple dropshippers?

This can be complicated, since a customer could potentially order 2 different items from 2 different suppliers. You wouldn't want to charge your customer too much for shipping, so you can do a few things; 1. You can make sure that your suppliers use one service like UPS to ship. Then you can use the UPS calculator to get shipping costs for the 2 products from one location. Or 2. You can calculate shipping charges on each product and charge a flat fee for shipping. You will lose money on some shipping charges, but you will gain on others.

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What are the benefits of using a Dropshipper for my business?

No overhead is the first benefit. You are not storing and stocking the inventory, so there are no extra costs involved there. There are no extra costs for you to take the time to pack and ship the product. Dropshipping is also great for testing the product.

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