I import bathroom fixtures from China and warehouse them in support of our retail site. We have dropshipped on behalf of our competitors because our prices are very good. I can tell you though that dropshipping is not all it is cracked up to be.
From my perspective, the rewards are too little and the risks too great. And service on my part suffered until the relationship became strained to the breaking point. So I would be one of those dropshippers who gets bad press except that I realized the limitation of this type of relationship and stopped doing it.
It looks great on paper but when you get a bunch of frantic follow-up emails everyday from customers who expect 1-2 day shipping then responding to the followups takes even more time away from shipping. Or else you are too slow in responding and get in trouble for that. Then the retailer wants me to take returns. Why, I am selling wholesale not retail?
Being a dropshipper is the same amount of work as being the retailer but without the added profit. Usually selling in bulk makes up for the lower profits but with dropshipping you are selling individual orders.
Also, running up accounts receivable on the shipping charges with UPS, which I was not even making money on, was unnacceptable. Then billing was another hassle not worth the wholesale markup.
Anyways, I just thought I would pipe in with the reason these relationships rarely work out so that you will think twice about building a business around it.
Steve
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