Drop Ship Company

Written by Kathleen Gagne
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Working With a Drop Ship Company

Becoming an entrepreneur these days is almost as easy as creating an effective website and then marketing it. Of course, you will have to set up a method of collecting money for items ordered. You'll also have to deal with the issue of products. That's where a drop ship company comes in.

If you're really lucky, your website will get thousands of hits, and you'll get lots of orders. Once you've determined what products you want to sell, you'll have to decide how to get them to the customers who want them. Today, many online vendors carry no inventory at all. Instead, they contract with a company that maintains an inventory of products from which the vendor can choose.

How It Works

When an order comes in for one or more products, the online vendor first gets paid by credit card online and then sends a request to the drop ship company. The shipper prepares a package and ships it to the individual buyer. The vendor then pays the shipper, either before shipment or per monthly invoice.

The advantages to the vendor are enormous. For example, the vendor's cash is not tied up in inventory or storage space. In addition, the vendor takes no risk in terms of whether any given product will sell. Finally, because of those first two factors, the vendor is able to concentrate on marketing and sales and to sell products at very attractive prices. In this scenario, everyone wins, even the shipper who has someone else marketing his products.

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