What is the difference between wholesale shipping and drop shipping?

What is a wholesaler?

A wholesaler is essentially the supplier who buys directly from the main distributor. Wholesalers often buy products in excessively large quantities, which they then sell to retailers or online store owners in smaller quantities, even as low as one item at a time.

However, you can also access wholesale prices directly from some suppliers. For example, a small business may be so small that it offers direct wholesale prices to both retailers and online store owners.

What is drop shipping?

Drop shipping is an innovative method of order fulfillment, ideal for e-commerce stores. It allows you, the online store owner, to place items on your website for sale, without the need to keep any inventory on hand. When an order is placed, you submit the required information to your supplier and they ship the order directly to your buyer. Most of the time, they make it look like the order was shipped from their distribution center and will never print your name on the packing slips. This is known as blind submission.

How are dropshipping and wholesalers connected?

If you launch an e-commerce website with the intention of keeping only minimal inventory, or no inventory on hand, then you will create a partnership with a wholesale provider that offers drop shipping services. When a customer places an order with you, you pay the supplier their wholesale price and keep the profit. Since you only pay wholesale prices, you are free to determine the markup for most products. Always remember to consider the shipping cost that you will have to pay to the supplier to send your order.

What are the advantages of drop shipping?

The reason many ecommerce website owners choose dropshipping is because it allows for much less overhead and saves a lot of time. Here are some of the advantages over buying wholesale stocks in bulk:

• Sell ​​a wider variety of products, without a larger financial investment and without having to pay for any products up front
• Eliminate the time required to ship products
• Sell ​​hundreds of products at once, without keeping any inventory on hand
• Manage your business from anywhere with internet access

Will I get good wholesale prices with drop shipping?

This is a very common question that many people ask. Most people unfamiliar with drop shipping can expect to get the same lower wholesale prices when they buy in bulk, which is not the case.

When you buy from a drop shipping provider, the wholesale price will be slightly higher than the price when buying in bulk from a wholesaler or manufacturer.

For example, if you buy a large pallet of electronics, you can spend $5,000 up front for the entire pallet, but if you buy from a drop shipping company, you’ll pay for each item one at a time as you sell them over time. These companies often increase their wholesale prices to cover the general costs of storing the products and handling and packaging the products for shipment to their customers.

Comparing your dropshipping price to the market

The best way to determine if you’re getting good prices so you can make a decent profit is by comparing their wholesale prices to those listed on eBay and Amazon.

When you’re comparing their wholesale prices, always keep in mind that you’re not the one subject to the overhead costs. You should also always take into account the shipping fee. Some providers offer free shipping and some may charge more shipping fees than others. Add up the selling price + shipping fee and then compare the total cost to your supplier’s wholesale price + shipping fee. This will give you an accurate result.

Also, when comparing your wholesale prices, you should always compare them to the average prices you find on eBay or Amazon. The reason is that not all sellers use drop shipping. Some sellers may be buying products in bulk at a cheaper price or they may be buying cheaper replicas or similar products from China.

Most inexperienced sellers will compare their wholesale costs to the absolute lowest prices found on eBay or Amazon and jump to a conclusion too quickly. You should always compare your prices to the averages and not give up before you start selling.

Remember that the quality of the products is extremely important and will directly contribute to your long-term success with your online business. Focus on providing great quality products and great service, and your business will flourish.

Can you still buy in bulk?

Most sellers use only the direct shipping method, but the choice is up to you. If you come across a very low wholesale order price that is too good to pass up, make the purchase and upload your product to their website. When that specific product sells, you will of course be responsible for shipping. Unlike drop shipping, you’ll also need to pay for the entire order in advance.