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How To Manage Your Wholesale Drop Ship Product Supplier |
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There are two very different ways a retailer relates to their
inventory. On one side, a retailer's inventory can be the heart of
their business, and it helps define them and might guide how they
present themselves to the public. In fact, can a retailer be a
retailer, if they have nothing to sell? On the other side, inventory
can be a major expense and risk to the reseller. Retailers must not
only decide what to sell but they must answer other basic inventory
management questions. How much do they buy? How long can they afford
to have it sit on the shelf? How do they store excess inventory?
For some retailers, how to manage inventory is not just a component to
address in the supply chain, but it is THE component of the supply
chain. For example, having the wrong product in the inventory stock
can be detrimental. Would you want to have a warehouse of buggy whips
as more carriage owners switch to automobiles or expensive typewriters
as PC's and word processors hit the market? You would have to
eventually unload your products at drastically reduced prices, even at
a loss. Some products might also have a limited shelf life, and this
does not just pertain to produce. For example, some high-end
electronics might come with expensive wholesale prices, but the models
might frequently change with additional technological improvements
making items in your warehouse less attractive to consumers. Other
products might just be part of a temporary fad. While fads can be
great trends for retailers to take advantage of, you would not want to
own the largest showroom for "Bell Bottoms R Us" at the start of the
80's. Effective retailers are those who can manage their inventory so
they do not have too little stock of popular products and miss sales,
but also those who avoid having too much product stored when models or
trends change.
For ecommerce merchants, drop-shipping can help avoid some of these
risks and help promote a healthy relationship between the retailer and
the products they sell. Drop-shipping also helps new or existing
entrepreneurs to enter the online market place by allowing new ventures
to start without significant upfront capital to stock the shelves.
In a nutshell, drop-shipping works by allowing retailers to sell a
product while the suppliers make and/or store and ship the product to
the customers who buy the product. |
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