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Drop Shipping Comes In Many Forms

Written by: Gary Granai

Article Overview: Drop shipping success depends on you knowing what it takes to succeed with the type drop shipping program that you choose. If you choose the wrong category you may not only fail, but worse yet miss a big opportunity that might have been yours had you chosen correctly.

Drop Shipping Comes In Many Forms

Business startups flock to drop shipping services in droves. And in the common rush to start, they set themselves up for failure with an ultimate failure rate reported as high as 98%. Oftentimes their failure can be attributed to picking the wrong drop shipping business category. And that is because they do not understand that there are categories.

There are distinctly different categories of drop shipping businesses. And one has to approach each one somewhat differently to be successful.

Mini Drop Shipping Business -- This is a highly focused, niche business that can be worked either on the Internet or offline. This is perhaps the best choice for someone who is just getting involved in drop shipping. The risks are low and the business is highly rewarding.

Amazon Site – This is not Amazon. It is a site called an Amazon site because it uses Amazon for its drop ship supplier.

Amazon is perhaps the largest drop shipper in the world. There are many Internet millionaires already retired after having set up Amazon type drop shipping sites. They are not difficult to set up and easy to promote. But they do take more startup capital than most beginners are willing to risk.

Catalog Store -- Drop shipping existed long before the Internet. It owes its origin to the paper catalog companies that generally have never maintained their own inventories. They do the marketing, take the orders, and have a fulfillment house or drop ship supplier handle the entire order fulfillment process.

Today the internet allows you to have your own Catalog Store by putting a relatively inexpensive catalog in front of millions of people.

If you are going to sell something like crystal, jewelry, glass, gifts or any other hard good item, you will be looking generally at the Catalog Store category of drop shipping.

Auction House – Selling on an auction site is a popular venture that gets people interested in drop shipping. Savvy internet marketers sell at a loss on eBay to build customer lists.

Your Income Potential

Ebay is a world unto itself. Its main advantage is that it is an instant source of customers. Your profit potential is limited. Ebay makes power sellers. It does not make internet millionaires. But it does build customer lists.

The other three categories are for those who are interested in making a significant income.

Though a mini business may only generate a profit $500 per month, when one sets up a network of them, the numbers can get big. Some web marketers set up three or four new ones a week. They have hundreds on line. They make a LOT of money.

An Amazon site is a cash cow. It looks complex, but in reality, it is a lot of content surrounding products sold by Amazon. The sites are set up using special Amazon site building programs. They take a lot of promotion to get going. But if done correctly, they are millionaire makers.

The Catalog Store offers you the most flexibility. And there are hundreds of offers out there from web site designers and shop cart companies to set one up for you. You can go far astray, fast, in this category.

Drop shippers within the Catalog Store category sell products that they get directly from drop ship suppliers.

The Catalog Store Category is usually what interests most beginners. And all too often they lose money trying to get started.

Only with experience do people learn that they might have made it easier had they looked at an Amazon Site or Mini Businesses.

If you are considering drop shipping, be sure to study each category thoroughly before you commit.

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Article Tags: amazon, auction house, business startups, catalog companies, catalog store, common rush, crystal jewelry, drop shipper, ebay, failure rate, glass gifts, internet millionaires, niche business, order fulfillment, paper catalog, savvy internet marketers, ship supplier, shipping business, shipping businesses, startup capital



Related Forum Posts
Re: E-Commerce Spending Down? - [quote="Kevin":35jt4q4o]In addition, on eBay, the shipping cost can sometimes be free/lower to attract buyer attention, but then the still cost more than another seller who charges more for shipping.[/quote:35jt4q4o] When I sold manga and Japanese "hanafuda" playing card decks on eBay the competition would often offer a lower product price and jack up the shipping and handling so that the total would be more expensive than my "higher priced" items! Shipping weighty products such as mj sets from Japan by Express Mail Service means free shipping is definitely not an option. This year my turnover has been par for the course, except August and September... August was one of the best months ever, September one of the worst! Now we seem to be chugging along at a regular rate again... despite hiking prices to adjust for the strong yen against the ever-weakening dollar.
International Shipping Costs Money! - Here's my perspective on high "shipping" costs, as someone who ships high quality mahjong sets across the globe from Japan... "Shipping" costs amounts to more than just the price you see on the shipping label! (That's why we call it shipping AND handling!) For example, if you want one of my top-end mahjong sets it will cost around $65-$95 to have it shipped to you. About $12-17 of that is eaten up by Paypal transaction charges. The rest goes on Express Mail shipping, and NO I don't offer other methods because they do not offer any security for either party. A set weighing 3-5kg when packed will cost around 5000-7000 yen to be shipped to the USA, more to non EU parts of Europe, and more still to South America. And the dollar is only worth 87 yen on Paypal at the moment (down from 120 yen a few years ago...). I haven't mentioned the cost of getting the sets from the supplier to me, or the packaging costs. I regularly find myself "subsidising" the cost of shipping sets to places like Russia - even though Russia is one of Japan's neigbours! The other day someone wanted to buy three high quality sets but hated the "shipping" cost - so the order fell through. No worries. I don't have time to waste on those who think shipping should be free. International shipping is an amazing service - and an expensive operation! Don't take it for granted.


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