Dropship Wholesale

Written by Kathleen Gagne
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Use Dropship Wholesale Methods

Internet vendors have a great way to minimize their capital outlay and maximize their profit margins. Dropship wholesale warehouses offer the vendors the option to purchase the products they sell to customers after they have already sold them. If this sounds a little unusual, it is. Most businesses that sell products shoulder the expenses and risks of carrying an inventory.

Because so many new businesses start out with limited capital, online companies have turned to dropshipping wholesalers for a way to keep their cash flow moving in the right direction. Imagine having the option of selling from a list of thousands of products without ever having to consider inventory costs. This is how many successful online vendors grow their businesses and manage to make a very good living. These vendors are comprised of all kinds of businesses and range in size from fairly large companies to single entrepreneurs operating out of their homes.

The Dropship Wholesale Process

Basically, the process is simple. The wholesaler buys and maintains what is usually a huge inventory and works with multiple vendors who sell the products. This allows the wholesaler to buy cheap and sell at wholesale rates because he avoids all of the costs associated with marketing (except online marketing to vendors).

The vendor establishes a contractual purchasing relationship with the wholesaler, sometimes by paying a small monthly fee to gain access to the wholesaler's product list. The vendor has a complete wholesale price list and sets the retail rates at which she chooses to sell to the general public on her website. The vendor and wholesaler also establish the rates for shipping and handling. The vendor then sells the products and collects the money, and then puts in an order to the wholesaler who ships the purchased products to the consumer in packaging that reflects the vendor's company.

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