Hello and welcome to the Inventory Source Supplier Spotlight, with Andrew Ruppar.  Today I am talking with Kate Walker, an Account Manager with XS Depot. 

Hello Kate.  Welcome to the Inventory Source Supplier Spotlight.  It is always a pleasure talking with you.

[Kate Walker] --  Hi Andrew.  Thank you so much, we're happy to participate.                                                       

Please give us a little bit of background on XS Depot and the types of products offered through your program.

[Kate Walker] -- XSDepot.com is a wholesale distribution site.  We currently distribute software, electronics, peripherals, and accessories.  We've been in the business for 20 years now, and our product lines are constantly growing.  That's why we're so glad to have a company like yours providing services to our resellers.  We're moving into our new corporate headquarters and warehouses at the end of March . This larger facility will enable us to carry even more products and make our fulfillment process even more efficient. 

That sounds great.  I am excited to see your wholesale product catalog will grow this year.  I know ecommerce store owners have a natural interest in software products, so your program sounds like a great dropship offering.  In your role as an Account Manager with XS Depot, what type of resellers do you see join your program?  Are many resellers new to ecommerce or are they more experienced sellers or software professionals?

[Kate Walker] -- I'm so glad you asked that.  It's been very interesting these past few years to see that more and more newcomers to the Ecommerce Industry are starting websites to distribute product, and quite a few have done very well. Another growth pattern we've noticed is that traditional brick and mortar retail store owners who are often very successful offline have decided to expand their offerings online as well.  It used to be that there was a huge disparity in success rates for established companies vs. home-based startups.  Now that services like yours are in place, the playing field gets evened out a little.  I've seen some brand new, home-based resellers put together some professional looking sites that they get from you and either customize themselves, or add on an already built template they found on some of those template sites you recommend, and load them with our products, and some of them are incredibly successful. 

Yes, we have also seen some great feed back from owners who have websites that we automate.  They look at our service as a way to instantly add an IT Department or Supply Chain team to their business, and I know the owners who use our automated hosted website platform love the customizable options.  Are there any particular traits that you have seen common with some members who have been successful selling product from your program?

[Kate Walker] -- Definitely.  I would say the biggest factor is the desire to learn.  Some people come into the business thinking it's going to be easy, and it's just not easy when you first start.  Riding a bike, now that's easy…but there was a time when you probably thought you would never learn how.  There is so much to learn in ECommerce-marketing, sales, customer support, and product knowledge.  It's a lot to absorb. We've been in the business 20 years, and every single one of us here is constantly learning new things every day.  There's so much information out there though, totally free on the net, or at the libraries, and the resellers who take the time to learn have a definite advantage.  Another factor is determination.  You can't be the kind of person who gives up just because you run into some roadblocks.  You have to want to succeed so badly that you leave yourself no other option. It's also important to mention image. Everything a reseller does, from how they design their site, to how they respond to emails, to how they answer the phone...it sends a message.  If the customer on the other end is not receiving the message that they are dealing with a professional established company that is already successful, they may choose to shop elsewhere.    

I agree.  Some resellers might have never run their own business before and they want to see huge sales on the first day of a new site.  You are right that if they spend some time perfecting their site, pricing, marketing, etc. success is not difficult to achieve.  Your point about image is important as well.  What are the common pitfalls that new resellers face?

[Kate Walker] -- I'd say that the biggest pitfall is buying power.  This is common in any industry of course. New resellers often struggle with the fact that their competitors are selling product at a lower price.  They often say, "How is that possible?".  Investment, that's how.  I've never met a successful business owner yet that didn't invest time and money into their business.  Most distributors give significant discounts for volume purchasing.  It's a kind of catch-22 for the new reseller that they have to buy more products to make more money, but they have to make more money to buy more product.  Getting over this hurdle is the most difficult, but it can be and is done on a regular basis. We encourage our new resellers to carefully select a few products to stock in bulk.  We always let our resellers know when we have a closeout deal coming in, and a savvy new reseller will often use that type of product to "corner the market" on a product and launch their company to the next level. Then they use the earnings from that success to replicate the process. Lastly, our newer resellers often have the passion required to advertise more creatively.  They'll take the time to list the product 10 different ways on Ebay, or list multiple skus on Amazon, etc...this really can give them an edge over companies whose systems are completely automated and don't allow for those extra efforts. 

That does sound like an excellent approach, Kate.  It is a type of “mixed” dropship.  Once a reseller begins to receive some sales and revenue they can buy a few key products in bulk and get better pricing from your program for that bulk order.  Then they can sell those products and capture a higher margin. Speaking of new selling approaches, XS Depot recently began storing the ASIN numbers for the products and providing this value through Inventory Source, to help resellers more effectively promote their products on Amazon.  As you know, selling on Amazon can be a challenge because of how they use the UPC’s or ASIN’s for listing product data, so this is a great value provided by your program.  What are some other places that you would recommend to a reseller to perhaps market or sell their products?  

[Kate Walker] -- I have to be careful here, because we make it a practice never to "advise" our resellers to specifically do one thing over another, but what I can say is that the answers are evidenced in the patterns of your competitors.  Since we're talking mostly here about online sales, then the first thing a reseller can do is observe the competition.  If you are listing on Amazon, then you are able to easily see who else is listing there.  One by one, you can evaluate that competition by checking out their store, their products, their pricing. Then you can enter that company name into the major search engines.  You will see all the references to that company and know where they are advertising. You can also query the search engines for "shopping sites", "auction sites", and then even more specifically for sites related to your products, so for our customers, "software stores", "educational software", "computer products", etc and you'll find even more competitors.  It's tedious research, but you can learn so much that way.   

That does sound like a good approach and it goes back to what we talked about earlier about the need for the desire to learn about ecommerce when selling on line.  Also, I think it is important to “Know Thyself” when marketing dropship products.  You can learn where your competition sells products, but consider which avenues you as a reseller feel comfortable with using.  Some people are good at managing their auction listings, while other resellers feel more comfortable using the shop compare sites to market their products. You and I have talked before about the value of content for SEO purposes and rankings.  When selling software and accessories do you have any ideas  for how resellers can begin to add additional content for their websites? 

[Kate Walker]  -- First and foremost, I think it's important to mention that resellers have to be extremely careful about content in terms of copyright infringement.  If they're finding content and using it without the permission of the creator, they could run into some serious problems.  There are article writers though, who have content all over the net which clearly includes permission to use as long as you do not edit the material or remove the links included. There are all kinds of things you can do to get customer generated content too.  You can email and ask for a product review.  You can have content contests (like, "How Playing Educational Software Games Changed My Grades", or "Is an "Office Alternative" Program Really as Good as Microsoft Office?" with your merchandise as a prize.  And of course, you can create content which has value to your customers.  You'll find that once you start adding content, it becomes easier all the time.  It's stopping you'll find difficult!   

Ha!  That is so true.  Now, many members also have an “About Us” section on their site.  What recommendation would you give to a new member to help them create the content for their “About Us” page?

[Kate Walker] -- Again, not a recommendation, but an “observation”…when I visit an About Us section, I am expecting to see a summary of the company as well as its products and services, and also a link somewhere to the Contact Us information.  Since I can't visit the store in person, it's very important to me to feel like I have all the information I need to know the store's offerings, and also to get a sense of its business practices.  Our resellers, either directly or indirectly through us, are able to offer their customers all of our products and our services (like tech support). This is something to be very excited about, and the About Us section is a great place to communicate that excitement.  

Excellent point, and again that goes back to our discussion of the value of “image” and “message” when promoting an ecommerce site for dropship products.  Taking another approach, what are some indicators you see on websites which create a negative impressions for you?

[Kate Walker] -- (Laughter)..there are so many!  Too many colors, too many fonts, weird fonts, having to scroll left and right to see the whole page, missing images, (especially on the home page), dead links, words spelled  incorrectly, bad grammar, slow loading pages, flash intros,...oh, and I almost forgot two very important ones: no phone number and no address-that's a deal breaker for me. I like to shop online, and I usually don't take time to actually call the phone number or look up the address, but if it's not there, I feel like I won't get the support I need if I have a problem.
 

Kate, I think we have covered some excellent tips for dropship resellers and learned a great deal about XS Depot’s dropship program as well.  For people looking to create a new account with XS Depot, can you describe the account creation process?  How long does the typical application process take? 

[Kate Walker] -- We just streamlined this process, so I'm glad you asked.  The applicant starts the process online.(here: http://xsdepot.com/DealerTerms.asp)  If the information they provide is verifiable online, then we're able to get the login to them the same day along with a Credit Card Authorization that they'll need to fax in before we can process their first purchase.  Delays happen when we can't verify the information or it's not provided.  If a reseller is brand new; their site is not up yet, they work from home, etc..it's a good idea for them to call us to explain their situation. 
 

That sounds great.  XS Depot does have some exciting changes taking place.  Last, what kind of advice would you offer to our reseller members?

[Kate Walker] -- That's easy!  Come to XSDepot.com to get the best overall package of products, pricing, and services available!    

Kate, as always, it is a pleasure talking with you.  Thank you so much for your time.

[Kate Walker] -- It really was fun.  Thank you, Andrew, for everything your team at InventorySource.com has done to make it so that our resellers have every advantage possible.  Our resellers have nothing but good things to say about you guys, and that means a lot to us.  

This has been Andrew Ruppar with the Inventory Source Supplier Spotlight, wishing you continued success and a bright business future.