Are you new to Amazon dropshipping? Don’t worry – even seasoned sellers regularly commit the mistakes we are going to write down now.
First, let’s clarify what Amazon dropshipping is?
Drop-shipping is a direct delivery of goods from a supplier to a buyer. The seller acts as an intermediary and does not store goods in your warehouse. He is only a binder link between them. The goods are sent to the customer directly from the manufacturer’s warehouse.
While there are many factors that can contribute to a store’s decline, we found that many traders fail in the same key area: drop-shipping.
When organized properly, drop-shipping can be of great benefit to online store. Instead of worrying about receiving, storing and forwarding goods yourself, dropshipping allows you to set up a system in which purchased items are sent directly from the manufacturer to the client.
While this method reduces overhead and simplifies shipping, many entrepreneurs are unable to take advantage of these benefits due to several repetitive mistakes. Below is a more detailed description of the errors that should be avoided when establishing direct deliveries:
1. Choosing the wrong Amazon dropshipping supplier
Besides identifying the right niche for your store, it is also important to pay great care in choosing the right supplier. Your supplier will influence everything; from product quality to delivery times, so it is important that you choose someone who will match your standards.
In addition to checking reviews of your potential supplier, try doing test order.
2. Rely on one supplier
While the fact that you have found a reliable supplier is one of the most important steps, do not allow yourself to relax. What happens if your supplier has runs out of one of your top-selling items?
If you put all your eggs in one basket, a similar problem can cause the existence of your Amazon business is at stake.
You should always have a backup supplier. And in case something happens to your basic. You can still take orders and ship goods to customers. Be careful and make sure that the contract with your main supplier doesn’t prohibit cooperation with others.
3. Don’t show shipping charges
When buyers look at prices on your site, do they immediately see the delivery cost?
Although high shipping rates are already considered one of the main reasons why customers do not continue to buy, which is even worse when these costs are not shown until the very last moment, but only on the product payment page.
To keep your customers happy, you need to display shipping costs from the very start. Many retailers find it better to use a fixed rate for all products, or add the “shipping calculator” tool to the page orders.
You shouldn’t bypass free shipping. The survey found that 90% of shoppers listed free shipping as an incentive # 1 that drives them to shop online more often than usual.
4. Lack of order tracking after purchase
Customers want to know when they will receive their order after purchasing from an online store. However, too many new drop-shipping sellers feel that their interaction with the client ends the moment he clicks the pay button.
Lack of feedback is unlikely to increase the credibility of your store in the eyes of customers – instead, they might think they’ve stumbled upon scammers!
To provide reassurance to your customers and avoid complaints, be sure to provide easy-to-use order tracking system with the help of your supplier.
- Send email notifications when an order is confirmed or shipped.
- Continuous feedback is especially important if delivery is delayed, or if an item is temporarily out of stock.
- Keeping customers informed is a key factor for their satisfaction.
5. Poor return system
100% customer satisfaction is a noble goal, but hardly achievable. In fact, online retailers are returning 30 percent, especially in apparel.
If you do not have a simplified return policy, you will face a lot of angry clients.
When choosing a supplier, make sure they provide a simplified exchange and return system. Understandable conditions and timely answers to questions from buyers will enable you to maintain a good relationship with customers. Even if something will not go as smoothly as planned.
Potential pros and cons of dropshipping
In e-commerce, as in life, any approach to execution has advantages and disadvantages. Whether the achievement is worth the pain depends a lot on your goals and business situation. Here are the potential pros and cons to consider when weighing whether dropshipping is right for your ecommerce business.
Possible benefits of dropshipping:
- Overhead: Since you don’t store or ship products, dropshipping can reduce overhead costs, such as maintaining a warehouse or sending products to customers.
- Initial costs: Entrepreneurs looking to start a business with minimal investment can turn to dropshipping as they do not need to invest in premises or resources to process orders.
- Multichannel selling: You can use dropshipping for your business by selling on your own domain, through a store like Amazon, or through social media channels – or all of the above.
- Location: Dropshipping allows orders to be fulfilled regardless of location, opening up the ability to work from anywhere.
- Scaling: Using vendors can make it possible to take more orders without increasing the inventory you store, pack, and ship.
Possible cons for dropshipping include:
- Competition: Given the low cost and investment to get started, dropshipping is highly competitive.
- Product quality: Drop-shipping reduces your participation in the fulfillment process, reducing your ability to monitor and guarantee product quality.
- Branding: Because the products you sell may not be unique or differ from similar offerings from other sellers, you may have trouble differentiating your offering.
- Profit margin: Little or no product variation means your business may end up competing more aggressively on price. Selling at low prices can eat up your bottom line.
- Lead time: When the dropshipping service is handling the lead time, you have no control over the order selection, packaging, and shipment.
- Inventory management: Up-to-date updates on stock availability may not be possible. If a customer places orders only to find that a product is out of stock, that bad experience can thwart a future order and thwart your brand.
- Range of offers: Since you are not in the business of fulfilling orders, you may be limited in special offers and promotions that you can offer, such as picking or free shipping.