Drop ship companies

[atanner]

Hello everyone,

I would like to tell you a bit about running your ecommerce website on auto-pilot and protecting yourself from online fraud.

I have been in the Internet industry (developing high-end websites) since 1995 and currently run one professional web design firm aimed at the small business market and an Internet software company with hundreds of customers across 14 countries.

In these 10 years, I have been privileged to help countless small businesses, local government and many brand-name companies like Polaris, Honeywell, 3COM, Pearson Education, and so on. My original web development firm was focused on high-end website integration with mainframe computers, proprietary business software, telephone systems, ecommerce, and even satellite.

Small business ecommerce needs are quite different than those of major online retailers. Here are a few pointers on how to automate your online sales...

1. Putting your ecommerce website on auto-pilot

Depending on your industry, your options may vary. Four key things you can do to automate your online business include the following:

A. Use a call center to handle incoming calls and take care of minor communication tasks. A good call center will learn about your business and products and can answer common questions and even take orders over the phone. They can also send out product literature by mail, email, or fax and so on. The best part is that your phone is always answered! The service can cost as little as $200 per month - Including a toll-free number...far less than you would pay for a receptionist.

B. Use a solid shopping cart/ecommerce module for your website that can automatically calculate taxes, shipping, and so on. The shopping cart can also manage inventory for you and handle backorders, etc. A good shopping cart can save you a lot of time and effort, and often includes opt-in email campaign management and other goodies.

Finally, your shopping cart software may be able to write orders to your accounting software like QuickBooks. Before you go spending over $1,500 on a full-featured solution, talk with a few web development firms as they may have licenses for various ecommerce systems and can implement the software for you as part of your website redesign at a better price. Personally, I don't recommend any of the freeware ecommerce systems to run a solid business...but they are an option for those that are strapped for cash.

C. If you travel a lot or reside outside of the U.S. while selling to a primarily U.S. market, consider using a Voice over IP service that allows callers to reach you consistently through the same phone number regardless of your location. If you are outside of the U.S. - this is really critical.

D. Use a Drop Shipper or Fulfillment house to ship your products when orders come in. Your shopping cart system may be able to send the order directly to your vendor when an order is placed. However, you may want to review the first several orders personally and pass the details on to your vendor until you feel comfortable with the process and can be sure orders will be handled correctly and so on.


2. Reducing the risk of fraud

The beauty of the Internet is that it opens your business up to a worldwide market. At the same time, the Internet makes it easier for people to falsify their identities and otherwise steal your products and services.

While this is a risk, it really isn't a huge risk...and you stand to gain far more than you will lose.

Here are a few things you can do to protect yourself:

A. Use an ecommerce gateway or 3rd party merchant provider that has a solid fraud protection service.

For my software firm, I chose Share-It (now part of Digital River) based on their large customer base and reliable fraud-protection system. Since I began selling through their service, I have had under 3% fraud, charge-backs, and returns combined. Obviously part of that equation is a good product and excellent customer service, but we don't even see fraudulent order attempts.

Note that Share-It (http://www.shareit.com) focuses on software sales and service. They have no monthly fees, but take around 5% per transaction depending on the payment processing model you choose.

While some International companies have complained about PayPal locking up their accounts (holding the funds as well), PayPal does have a good reputation for the most part in the U.S.

PayPal (http://www.paypal.com) recently launched a new service that allows you to sell products and services directly from your website. Previously visitors would be sent to the PayPal site which was a bit cumbersome. There is no monthly fee for the new service until October 31, 2005 ($20 per month afterwards.)

PayPal has a great fraud protection system in place, and now gives you the ability to sell your services without a standard merchant account...but with the same types of benefits including a virtual terminal for processing sales that are made over the phone, or by fax/mail.

Authorize.net is a popular gateway which requires you to have a standard merchant account. They offer fraud protection for an additional fee. http://www.authorize.net.

For international companies, World Pay charges a steeper fee per transaction and a setup cost of around $200...but they have great fraud protection. You rarely hear any complaints about World Pay. http://www.worldpay.com

B. Recognize that fraud protection is part of the cost of doing business, and build the extra fees into your overall pricing.

Well, it seems I ended up writing a little article here rather than a simple forum post...so I'll stop here and respond to questions later if they arise.

Best Regards,

Anthony Tanner
President
Fast Internet Success, LLC
http://www.fastinternetsuccess.com

p.s. The bold and bullet points weren't working for me...otherwise this post may have been formatted a little better.

[dcomiskey]

Tons of good info. Thanks, Anthony!

[JPnyc]

Absolutely. Heck of a 1st post. Oh, and welcome!

[Oppo]

I operate 2 websites and what go to industry trade shows related to my sites and talk face to face with the company reps at the show. I have been successful with that approach. The only fees I have paid is additional cost to handle drop shipping which normally is less than $4.00.

Face to face interaction at trade shows decreases the barrier of risk, improve relationship and increase confidence in you to the drop shipper.

Mind you, they are in the business to make money with the least amount of marketing expenses. Trade shows approach works for me.

[Gromit]

Wow, talk aobut the motherload of information. Between Anthony and Oppo, it's like a road map to setting up ebusiness.

Wicked impressive.

[CharlieUK]

Interesting thread.... and great information.

Agree with the point about trade fairs, this is a great opportunity to meet people face to face. I would recommend meeting with all potential suppliers if it is possible. The power of your network and being able to pick up a phone and speak with a "buddy" at any given supplier is not to be under estimated.

As an example, a while back I was having a coffee with a rep from one of our suppliers. He told me that later in the year they were moving to a new warehouse and office location. After a few more questions, it became apparent that they would be selling off a lot of the existing stock at cost price and halting production for 3 months. Wow! My initial reaction was of concern, what about access to stock? What if I need more? Then it was, ok.... let's make sure we can get as much stock as possible and ensure our competitors don't.

Other suppliers make sure we're on the first list when they have a sale or overstocks.

The point is, we would never have realised about the warehouse move and consequent availability of stock for cheaper had we not taken the time to speak and get to know our supplier.

[chopperuk]

Hi,

I have found a directory, which contains all the uk drop shippers and a few us drop shippers which ship to the UK. There pricing isnt bad either...

Let me know what you guys think...

www.ukdropshipping.com

NB: Quite suprised noone has mentioned it before, looks like they have been around for a while...

Regards

CHOPPERUK

[dcomiskey]

Hi,

I have found a directory, which contains all the uk drop shippers and a few us drop shippers which ship to the UK. There pricing isnt bad either...

Let me know what you guys think...

www.ukdropshipping.com

NB: Quite suprised noone has mentioned it before, looks like they have been around for a while...

Regards

CHOPPERUK

As I've said in other threads, I see no reason anyone should have to PAY just to find drop shippers. You're better off contacting suppliers in the area you want to sell in.

[CharlieUK]

Just a quick addition to this thread. We provide a free (yes it's really free) up to date list of dropshippers in the UK. Check out the link in my signature.

It's updated regularly. We even get dropshippers coming to us now.

[John Eugene]

You have a big time problem. Credit card fraud is huge outside the USA. Unless you take the risk of credit card fraud NO ONE WILL DEAL WITH YOU.

Visit www.jelessycollection.com I have a drop ship supplier by I TAKE ALL THE CREDIT CARD FRAUD risk.

My sight is a success.

I like your site! And the products, too. Where are your sources?
Can I resell your products in my web site (in progress)?



John Eugene

[davist]

Hello All,

Wondering if anyone had any valuable tax information (tax breaks, important tax rules, etc) that they've had luck with.

My partner and I just started almost finished with Devlopment and about to deploy the store but we're looking for a little Sage advice before we push the button.

Thanks,

Tosin
= )

[whub]

I am a newbie to ecommerce. Tried to start a website, but don't know much about getting people to my website. Anyone has some good ideas getting website traffics? Thanks.

Henry

[knobleman]

I have been using drop shippng for five years and have made a good living off of it selling on ebay. In that time, I have found about two dozen LEGITIMATE drop shipping companies, independent suppliers and buyer/seller communities. If you want to avoid wholesale/drop ship scams, a good reference website to visit is http://www.restaurantandbar.org

They offer an information package that will put you light years ahead of where I was when I started in this business. And it will also save you thousands of dollars in losses.

[TheWebMaster]

Anton,

I agree. I dont think it will be easy doing business from outside the US and catering to the US. Im not saying it's not possible since nothing is impossible however you gata have the right product.

[JMaguire]

Hi All,

Here's an article on Ecommerce Guide about drop shipping:

http://www.ecommerce-guide.com//article.php/3521251

It lists a few companies that offer drop shipping to merchants, in particular Commerce Hub [www.commercehub.com] is highly recommended.

Good luck!