Intro: How to Find Dropshipping Suppliers for Your Business
Are you wondering how to find dropshippers? If you are a future entrepreneur looking to start a business with low overhead and little risk, utilizing dropshipping suppliers may be something to look into.
You may have done some research online and discovered that lots of people are making money hand over fist with this business model. Now, it’s your turn. The time is right for you to start the next big company – all you need to do now is learn how to find dropshippers.
So, what does it take to start a successful online retail business?
With all the information available about wholesale dropship suppliers, it can be hard to know what steps to take first. Maybe all the information you’re getting is contradictory or even a little hard to understand.
If those concerns sound like yours, you’ve come to the right place!
This article will discuss what a dropshipper is, what companies that dropship actually do, and how you can find reliable dropshipping suppliers. Your new business will be off to a brilliant start in no time.
What Is Dropshipping?
Dropshipping is a relatively simple business model.
Basically, you have a website that sells something (let’s say, for example, monogrammed pencils.) However, the primary difference between normal retailers and companies that dropship is that the dropshipping companies don’t own the monogrammed pencils. That’s why it’s imperative to learn how to find dropshippers that are reliable and affordable.
In this scenario, you would not use your website to sell inventory you already possess. Instead, you would take the order for the monogrammed pencils through your website, and you would pass that order on to a manufacturer or wholesaler of monogrammed pencils, otherwise known as dropshipping suppliers.
Your supplier then ships the monogrammed pencils to your customers for you.
The great thing about this business model is that there is very little overhead cost because you are not responsible for purchasing the inventory you sell through your website. Your duties basically involve the cost of your website and your marketing. You aren’t even responsible for the fees for transporting the inventory to your customer.
Similarly, there isn’t a lot of risk involved if the business fails because all of the monogrammed pencils belong to the dropshipping suppliers.
A Better Lemonade Stand makes the definition of a dropshipper really clear with this excellent graphic:
Source: A Better Lemonade Stand
How Do I Choose What to Sell?
It is very important to figure out what you intend to sell before you go much further in your search for dropshipping websites and dropshipping suppliers. So, how do you decide?
Your best bet is to choose a niche (like our monogrammed pencils) and stick to that. This might seem counterintuitive to you. If you sell something niche, won’t you narrow your potential client base? The surprising answer is, no. Fewer potential customers means less cost in customer acquisition. It narrows your marketing and saves you time as well.
You also want to consider the price point of the product you’re selling through your dropshipping suppliers. According to A Better Lemonade Stand, “margins on drop shipped products are slim, making it difficult to make sizable profits. This can make it extremely difficult if you’re selling $5–$20 products and only making a few dollars per sale.” Its suggestion is that you should sell products that cost at least $50.
Who Should Use Dropshipping Suppliers?
So, how can you benefit from the dropshipping business model? Let’s look at the types of people who can benefit from dropshipping so that you can decide which category you fit in. According to A Better Lemonade Stand, the categories are as follows:
Validating Entrepreneur: Maybe you want to be really, really sure your monogrammed pencils will sell before you sink a lot of money into inventory. Perhaps you have an investor who wants to know exactly what his/her profit margins will look like. Wouldn’t it be great if you could check the efficacy of your website and marketing before you spend your startup capital on inventory? You can! Find yourself some dropshipping suppliers, and give your product an extended test drive.
Budget Entrepreneur: On the other hand, maybe you have no startup capital and even fewer investors. You know you can’t keep working your nine to five for the sake of your mental health, but you’ve got to do something with your life. Dropshipping can be an excellent model for you because, as we mentioned earlier, not much capital is needed to get started. All you need is a slick website and some excellent marketing strategies. You can get started for free as a dropshipper if you have a web designer for a brother-in-law and a few clever ideas.
First-Time Entrepreneur: It can be complicated to run an online store. If you’ve never done it before, you may not know much about driving and converting traffic. Those are things it can take time to learn. Dropshipping suppliers might be a lot of help if you need some time to learn the ropes of online sales but don’t want to spend a lot of money on inventory that you may never move.
Walmart Entrepreneur: Do you want to sell a wide variety of products through your online store? Maybe everything from monogrammed pencils to monogrammed underwear? The more products you decide to sell, the more it can cost you to collect your inventory. All you need is to find dropshippers that make monogrammed underwear, and you’re all set!
What Does Dropshipping Look Like?
A Better Lemonade Stand has another interesting and informative graphic to help us clarify the difference between real companies that dropship vs. “wholesalers” that sell at a markup:
Source: A Better Lemonade Stand
Let’s start describing the dropshipping supply chain at the beginning. The very first step is the manufacturer. The manufacturer is the person or company who actually makes the monogrammed pencils. If you are lucky, you can form a relationship with a manufacturer so you can get your pencils for an incredibly low price, which will increase your profit margins hugely.
The next step in the chain are wholesale dropship suppliers. Basically, wholesalers get their product directly from the manufacturer and sell it to you. There’s a bit of a markup from buying directly from the manufacturer, but the upside is that wholesalers are looking for people to sell to, and those relationships are easier to develop and maintain.
If you’re careful, that’s where the supply chain ends. If you’re not, you can end up working with a disreputable “fake” wholesaler. These dropshipping suppliers pose as real wholesale dropship suppliers, but, really, they’re getting the merchandise from the real wholesaler and selling it to you for a markup. If you get involved with a fake wholesaler, you’ll thin your profit margins to the point that you won’t make much profit at all.
So, how do we avoid these fake wholesale dropship suppliers? Continue to the next paragraph to find out.
How to Find Dropshippers
Are you wondering how to find dropshippers now? When separating the wheat of dropshipping suppliers from the chaff, there are a few things to remember to make sure you’re dealing with reputable wholesale dropship suppliers.
First and foremost, a real wholesaler has a very different way of finding out if the retailers who have approached them are qualified to get wholesale prices. Wholesale dropship suppliers do not sell products to the public, so, before you work with them, they will ask you to fill out an application.
The question of how to find dropshippers that are reliable is important because a reputable wholesaler will not just allow you access to their prices with a name and email address. In the US, they’ll require your EIN number and your Re-seller Certificate. If you’re not from the US, but you’re using US-based wholesale dropship suppliers, just let them know, and they’ll tell you what information they need from you instead.
You may also notice that most wholesale dropship suppliers don’t have the slickest looking websites. Dropshipping websites usually look pretty old, maybe even barebones. This is because they have no interest in luring the public into buying their goods –they only work with other businesses.
Real dropshipping suppliers also don’t publish their prices. Once your application is approved, they’ll give you a spreadsheet of their prices or provide you with a login. If they’re trying to convince you that they have the best prices in the market, they’re probably doing something shady.
So, with all that in mind, here are some ideas to get you started with finding companies that dropship.
If you know which product or brands you want to sell, you can always contact the manufacturer directly. This way, you can cut out the middleman and save the most money possible. These companies don’t always have dropshipping set up, but they can usually direct you toward a few free dropship companies that they work with.
You can search the web for free dropshippers. It can be pretty labor-intensive to find dropshippers this way. As we mentioned earlier, dropshipping websites usually aren’t updated, and they may not use SEO optimization. You might have to wade deep into the waters of the Internet to find what you’re looking for. Use a variety of terms in your search – for example, wholesaler, wholesale dropship, drop shipper, supplier, wholesale reseller, wholesale supplier, and free dropshippers.
Purchase a supplier directory. There may be a lot of dropshipping directories online, but, as with many things, you get what you pay for. Many directories are low quality and provide little value. Keep looking until you find something that really helps. Remember, this can be an important business expense. A good directory can contain hundreds or thousands of profiles for dropshipping suppliers. This is an important step when asking yourself how to find dropshippers.
Don’t be ashamed to ask for referrals. Friends and family often have great ideas or may have even worked with some free dropshippers themselves. Free dropship companies with which you’ve had contact might also be willing to help you find dropshippers. Even if they’re not the best fit for you, reps from companies that dropship usually know huge networks of other dropshippers. Use your new contacts to ask for referrals.
List of Top Dropshippers
Here is a small list of dropshippers to get you started:
Hobby & RC toys
Child & baby products
Safety, security & spy products
Fragrances & beauty supply
Costumes & dancewear
Replica knives & swords
In addition, here is a spreadsheet from A Better Lemonade Stand that lists 50 dropshipping suppliers.
If none of these help, take a look at this link for purchasing a larger directory. For only $19.00, it could be exactly what you need.
There you have it! You have a list of dropshippers, a few places where you can get more names of companies that dropship, a clear description of how dropshipping suppliers work, and some advice on how to tell which free dropship companies are legitimate and which ones aren’t. Good luck with your new business venture. We can’t wait to buy what you’re selling!
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