If you’re looking to start an eCommerce business, you might be feeling a bit overwhelmed at the variety of different options available for selling online. Even if you’ve narrowed down your options to Amazon FBA or dropshipping, it can still be tough to choose between those two. Both options have their fair share of benefits and drawbacks, but they are ultimately two of the best options for online sellers.
Both Amazon FBA and dropshipping are great options for entrepreneurs looking to break into eCommerce. When choosing between them, you’ll need to consider profit margins, shipping times, investments, risk, and many other factors. Ultimately, you will need to decide which factors are the most important to you.
In our guide below, we explore the differences and similarities between the two and also provide you with a third option that many entrepreneurs are now utilizing.
Before we move on, it’s important for you to understand what Amazon FBA and dropshipping is, and how those two options differ from one another. Though they may sound similar in theory, there are many factors that set them apart.
Dropshipping is the process of selling goods on behalf of another store, supplier, or manufacturer. If you were to start dropshipping, you would take up the task of marketing and selling the supplier’s goods. When you make a sale, the manufacturer gets notified and ships the order for you. You never have to see the products, and you don’t need to purchase any stock up-front.
FBA stands for “Fulfillment By Amazon,” and it is the process by which your stock is stored in an Amazon warehouse and fulfilled by Amazon employees. Because of the nature of the program, you DO need to purchase stock up-front AND pay for storage, but your products would then be eligible for Prime Shipping and listings on Amazon (in addition to your website). Like with dropshipping, however, you wouldn’t need to worry about fulfilling orders yourself.
The biggest differences between the two options relate to product inventory. With Amazon FBA, you need to provide the warehouses with products, which means several things. You would need to invest more money in the beginning to get your business off the ground, and you will also need to keep track of that inventory so you know when to order more. You wouldn’t need to do any of that with dropshipping. Aside from that, the two options function similarly.
Both Amazon FBA and dropshipping are great options for starting an eCommerce store, but one might be better for your particular business. Depending on your products, starting funds, amount of free time, and more, you might end up benefiting from one option more than the other.
To get a good idea of which option is better for you, you’ll need to weigh the pros and cons of both dropshipping and Amazon FBA and compare them to each other.
Dropshipping is often touted as the number one way to make money online by eCommerce gurus (and with good reason), but you shouldn’t just take their word for it. Examining the perks that make it so great is the first step towards making an educated decision regarding your business.
The biggest benefits of choosing dropshipping over Amazon FBA are:
With all that said, running a dropshipping store isn’t all smooth sailing. There are some drawbacks and difficulties associated with it, otherwise, everyone would be doing it!
As with any business model, you need to be aware of the negative aspects before you commit to it. Here are the less-than-glamorous aspects of dropshipping that you should know about:
If those drawbacks sound manageable to you, dropshipping might be the way to go! However, you should still consider all your options before settling on a decision.
Amazon is a glamorous option for online entrepreneurs, and you’ve no doubt been tempted by all their flashy perks. Here’s a run-down of some of the best benefits of choosing Amazon FBA over dropshipping:
There’s no doubt about it: Amazon is a tempting choice. However, like with dropshipping, it’s not without its flaws.
It’s hard to look past all the great benefits of Amazon, but it has its fair share of negatives as well. Amazon FBA isn’t a perfect solution for eCommerce fulfillment. Here are some of the biggest drawbacks of the FBA program:
Now that you know all the major pros and cons of Amazon FBA and dropshipping, you can make a more educated decision about which one is right for you.
If you’re just getting started in the world of eCommerce and you don’t have a lot of experience with running a business, then you’ll probably want to pick dropshipping over Amazon FBA.
Dropshipping is the most beginner-friendly option.
That’s the quick answer, but here’s an explanation for why that’s the case. It all boils down to the risks involved. If you’ve never sold anything online before, and you have little to no experience with running a business, you should minimize your risk as much as possible. With dropshipping, you have much less to lose.
Without having to worry about inventory, you can more safely experiment with which products sell well, how to maximize profits, and what the best marketing techniques are. Once you get a business established and you’re more confident in your abilities, you can move on to a different business model if you want—or not! Dropshipping is a great option for businesses of any size, and you can continue to make a profit as your business scales up.
If you read through the pros and cons of both Amazon FBA and dropshipping, and you aren’t sure you want to use either option, you don’t have to worry. There’s another option that can offer you the customization of dropshipping with the quality and speed of Amazon: a Third Party Logistics Company (3PL).
It might take you some extra effort to track down a good 3PL, but that can truly offer you the best of both worlds. Like with Amazon, you would need to acquire your own stock to store in the 3PL warehouses, but unlike Amazon, you can have full customization over packaging, kitting and assembly, packaging inserts, shipping options, and much more. When you work with Amazon, they call the shots, but a 3PL works for you.
If you aren’t happy with the options provided by dropshipping and Amazon FBA, then you should consider working with a 3PL instead.
If you’re tired of comparing the disadvantages of Amazon FBA vs dropshipping, then it may be time to consider the better option.
R+L Global Logistics is a leader in the 3PL industry, with a focus on quality, customer service, and accessibility. We pride ourselves on our ability to serve any sized company in any industry, and we never compromise on the service we provide. If you want a widespread distribution partner with locations all across the US, but also the values and service of a decades-old family-owned business, then look no further!
At R+L Global Logistics, we offer a wide variety of value-added services to take your distribution to the next level. These services include:
In addition to that, we can provide multilingual staff members to communicate with you on your terms and to facilitate the most effective communication possible. When you work with us, you become part of the R+L family.
If you want more information on the services we provide, you can reach out to us at (866) 989-3082. Our friendly customer service representatives are always happy to help.
If you’re interested in working with us, you can request a free fulfillment quote right on our website.
With a huge market share in the area, getting your orders fulfilled by Amazon can be an attractive component for any online business. But what do you do if it’s not a good fit for you and you need fulfillment alternatives to Amazon FBA? It can seem counterintuitive to be outside the retail giant’s sphere of influence and you might not even know where to begin looking.
Unless you’re going to handle order fulfillment yourself, finding an alternative to Amazon FBA will involve partnering with a different Third Party Logistics (3PL) provider. Many 3PL’s offer similar services to Amazon with some added benefits that make switching worthwhile.
Our guide below provides you with the critical information you need to find the best fulfillment alternative to Amazon FBA.
Using a third-party logistics company can really give your ecommerce business a boost. You get a myriad of benefits from partnering with a 3PL that can allow you to perfectly scale your operations to the size that works for you and also get a handful of helpful services that can free you up to focus on bigger picture aspects.
First off, a 3PL is similar to Amazon FBA in that your goods are stored at their warehouse, they fulfill orders for you and then ship them out to your customers.
In many cases though, a company focused just on providing their 3PL services doesn't have a website to drive ecommerce sales. You will be out in front selling the items while the 3PL will be doing all the back-end stuff.
But besides just saying that a 3PL will help you out, let’s delve a bit deeper into all the ways your ecommerce business can reap the rewards. First of all, you don’t have to worry about the cost of renting or buying your own warehouse space. The 3PL in question already has the buildings in strategic spots so that your products are in the right place before they even have to be shipped. Many 3PL’s, including R+L Global Logistics, can offer cross docking services. This is a highly efficient service that reduces product storage time and speeds up fulfillment delivery.
Taking it a step further, a 3PL is going to be an expert being able to accurately and quickly fill order in a variety of different ways. Whether it’s pick and pack fulfillment, which would be most of your orders, or something different like retail fulfillment or even cross dock transloading, a 3PL has done it all.
Some 3PLs also have the required tools to actually ship your orders as freight if needed, no matter if it is by truck, rail, air or even ocean. This would be for orders in large bulk or if you were able to sell pallets full of items to a retailer, but it’s still valuable to have the option.
But even if the 3PL just leans on its pre-existing relationship with a number of different parcel services, that could also help your bottom line. Because a 3PL would work in a higher volume, it can access greater discounts on bulk shipping. The 3PL would hypothetically then be able to pass on those savings to you, which will be a big help to your bottom line.
One of the options available that would be the most radical departure from Amazon is to handle your own order fulfillment. This can be a workable option for any small business that can't deal with its own inventory management and afford to set up a business model that accommodates appropriately for shipping costs.
If you are doing your own fulfillment, you’re probably not on Amazon or, if you are, you’re not taking advantage of their fulfillment network whatsoever. In fact, to fulfill orders yourself, you’d need a space of your own — whether that be your home, a small office or even renting your own warehouse. Renting your own warehouse, though, seems the least likely of these options since it would prove to be cost-prohibitive to rent out an entire building if you don’t need that much, then the other costs like staff, utilities and the like.
So let’s look at if you’re working out of a small space that you either own or rent. You assuredly have a website where customers can place orders and you can receive them. Then you’d package the sale yourself and be responsible for shipping it out, most likely through FedEx, the USPS, UPS or something similar.
If your operation is very small or you enjoy a more hands-on approach, doing fulfillment yourself can be the way to go. You’ll never have more control of your own operations than if you choose this option.
The drawbacks should also be considered as well. The cost of shipping as a smaller outfit without access to better volume discounts that other companies or even third-party logistics providers enjoy can limit an ecommerce business’s ability to offer the best prices or realize a profit margin as big as their competitors.
Also, if you’re handling all the fulfillment yourself, it might be harder to properly scale your growing needs if you want to expand. You’ll either be responsible for a bigger space to work out of and store products. Conversely, having a third-party company take care of fulfillment usually means they have the space and resources to allow your business to organically grow without hitting a ceiling.
If you’re also considering other outlets on which to sell your products, check out our article Alternatives to Selling on Amazon.
Do you think this one is cheating? It’s not but let us explain. You can still sell your goods on Amazon without having them do fulfillment and you can do it through their Prime program, which is called Seller Fulfilled Prime (SFP). You get the Prime badge on your listings but you handle the fulfillment yourself.
There is a catch, if you want to call it that: by being in the Seller Fulfilled Prime program, you are making a commitment to provide two-day shipping to customers without adding any additional shipping charges. Since you will still have costs associated with shipping, the challenge becomes setting the price low enough to entice customers but not low enough that profits are hard to come by or even impossible to realize.
Also, it might go without saying, but since this is a seller fulfillment option, you won’t be receiving any outside help on fulfilling your Amazon orders. While you get the benefit of listing on Amazon and having the Prime badge, it’s all on you. This is a win for Amazon as well, as they are able to expand the amount of products that they can offer Prime shipping to their members.
There are a few cons though. As mentioned above, you cover the costs of shipping but it doesn’t stop there. You are also on the hook for storing your goods and also responsible for handling returns. This requires additional planning and resources to be able to bear these costs.
Also, while it might not be considered a negative, Amazon requires up to a 90-day trial period to make sure you can fulfill your Prime obligations before it allows you to permanently have the Prime sticker on your listings. Depending on how you look at it, this can also be a positive so that you don’t get in over your head and become unable to properly fulfill the orders.
If you’re looking for a fulfillment alternative to Amazon FBA, you can stop your search and give R+L Global Logistics a call today to let us handle all your order fulfillment needs. As a financially secure company with many resources at our fingertips, great workers who do the job right the first time and the knowledge to run the whole supply chain on your behalf, you won’t find anyone more suited for the task.
R+L Global Logistics won’t just keep your items on the shelf but can actually pick and pack them once you submit your customers’ orders to us. We can send out individual orders, or if you have pallets worth to send at once, we can deliver those ourselves. Our freight shipping is one of the best deals in third-party logistics since we’re competitively priced and boast a 99.5 percent on-time rate. R+L Global Logistics offers additional warehouse and distribution services that can help your business such as reverse logistics (returns), kitting and even retail fulfillment should you require any of that.
So when you’re searching for a fulfillment alternative to Amazon FBA, pick up the phone and call R+L Global Logistics for a free quote to find out how we can help your business succeed.
You’ve got a great product or stable of goods to sell, a business model that should stand on its own and the desire to work hard and make money. However, you’re running an online enterprise and still need to figure out an aspect that could make or break your ability to be successful: how to handle your ecommerce shipping. This can be a giant pain point for customers and businesses alike, so getting it absolutely right should be a fundamental focus.
Ecommerce shipping is a process that involves many details and critical decisions. The process includes whether to offer free shipping to customers, how to package products, warehouse considerations, and more. Many ecommerce companies rely on a Third Party Logistics (3PL) provider to manage shipping and order fulfillment.
Below, we outline the steps you need to take in order to setup and manage shipping for your ecommerce business.
Before you decide what you can afford or what would work best for your ecommerce business model, it’s imperative to hone in exactly what your opinions are for shipping. The biggest differences between the following kinds are how much of it you do directly or outsource to another company. Each has their own positives and negatives and you’ll be tasked with weighing each carefully to determine which will make your enterprise flourish. Not to put undue pressure on you, but it is very important you figure out which will work best for you because it can definitely have a major impact on your business, for better or worse.
Good old D.I.Y. is definitely an option. This is just as it sounds, but even this comes in some different varieties. For instance, if your sales are small enough, you might be working out of your house, garage or perhaps a modest office/facility. Things might be low key and manageable enough to fill the orders yourself or with a team of people. In this setup, it could be easy enough to simply fill the orders as they come in over the internet.
This is good if you can handle doing so without compromising your abilities in other areas. You get to keep whatever profits roll in and it is a self-contained supply chain without middle men or any additional step that could complicate the procedure.
However, the drawback could come from your operation being small enough that filling each order yourself is more costly since you don’t have the advantage of lower bulk shipping that a larger enterprise or even one — as an example — who is connected to a third-party logistics company that has access to lower shipping prices because of the connections they possess. Also, just packaging and shipping a small amount of orders can be a time-consuming process that doesn’t allow you to focus on issues within your business that could really use attention.
Another potential drawback is if you need to expand your operations. If you plan on doing everything yourself, that means you’re on the hook for buying or leasing upgraded facilities to accommodate the increased workload and space needed, plus possibly adding additional workers of your own.
Warehouse fulfillment is currently at an all-time high and shows no signs of slowing down. So if you have an enterprise that you want to thrive in the current economic climate, using a 3PL to fill and ship your orders can be a huge advantage to your bottom line.
Outsourcing order fulfillment to a third-party logistics (3PL) company is an option when you don’t have the storage of a warehouse or the necessary setup to ship on the scale needed. But it can also be beneficial to any ecommerce business that would just prefer the fulfillment of their orders, which includes shipping, done on their behalf.
The benefits to using a 3PL for order fulfillment are numerous and used by many. The first one is that you don’t have to acquire space or make a huge upfront investment to get your shipping set up. You can access a 3PL’s already established infrastructure for your burgeoning business without having to invest a large amount of resources.
Instead, you pay for what warehousing space you need and pay per order/item fulfilled to customers on your behalf. Space in a warehouse is reasonably inexpensive and even the fulfillment cost itself might surprise you since 3PLs deal in such large overall volume that they can access discounted pricing on shipping and packaging materials that a smaller outfit couldn’t.
Another benefit is having less on your plate. Maybe you don’t want to or cannot give the time or energy to meticulously overseeing or filling each order as it comes in. So you can lean on another company that has the wherewithal, experience and resources to easily undergo this task for you. You can be more concerned with the bigger pictures of procuring your products or balancing the books than the minute-to-minute aspect of shipping.
On demand warehousing is directly linked to order fulfillment. Except in this scenario, it’s not necessary to exclusively use a 3PL and the structure of how you pay for both the warehousing and actual order fulfillment for your ecommerce shipping can slightly differ. It starts with you as the ecommerce business finding a company that has available warehousing space to store your goods.
Usually, that company will offer additional services which can include order fulfillment and shipping. Where this diverges somewhat from 3PL order fulfillment is it might not be a 3PL company that you’re paired with and you will be charged only for the space and services that are used. This can have big advantages for your business, especially if your operations are affected seasonally or just have any kind of variation in the services you actually require from day to day or month to month.
Instead of having to sign a contract for a certain amount of warehouse space, order fulfillments or shipping each month or year, you are literally charged for what the company provides for you. If one month, you need to store 15 pallets and fill 1,000 orders but the next month, it’s 10 pallets and 750 orders, that’s no problem. You will not be charged the same overall rate and it can result in savings for you.
The only real downside to this setup is because things are much more fluid in such a scenario, if you had a huge spike in the amount of goods you need stored or shipped out and there’s not the longer-term commitment locking in a certain amount of space, the company may be unable to accommodate you.
Besides figuring out how you’re going to have your items shipped to customers, it’s also a good time to figure out exactly how you plan on enticing said consumers to want to buy your products. Again, the answer could be shipping. The variety of shipping options offered could be the difference between a sale or goods sitting on a shelf.
This topic could be its own article, because if you’re able to offer free shipping to your customers, it can be the final push they need to make that purchase. So, the short answer in this regard is you should definitely endeavor to make shipping free for your customers. But let’s further outline the situations where it would be advantageous or not to offer this.
First of all, the biggest thing you have to determine is if you can remain profitable while making free shipping available. If you cannot turn an overall profit, then it’s just not sustainable or worth it to you. Because while shipping might be “free” for your shoppers, your shipping costs aren’t going anywhere.
Free shipping can offer a big boost, though, especially as an incentive to either keep pace with competitors or even possibly best those who cannot offer free shipping. Free shipping is proven to cause customers to buy more or even buy when they are on the fence or even otherwise wouldn’t.
Even if you’ve made the decision to move forward with this approach, you still need to know how to offer free shipping. There isn’t a one size fits all approach when it comes to offering free shipping, so it’s helpful to understand the various options available. An example would be if you planned on offering 40 percent off everything you’re selling, but you can’t swing offering free shipping if you do that. This is an example where maybe 25 or 30 percent off your products plus free shipping will be more enticing to a customer sitting on the fence. There’s no magic formula and trying out different things might be the only way to figure it out.
You can even set up free shipping in several different ways:
In some respects, your ecommerce business can use a combination of these methods of free shipping to further entice consumers. There’s no tried-and-true method to adding customers, so you might have to use some trial and error and also realize that only some of these types of free shipping will work for your specific business.
It’s proven that customers will tend to act more impulsively or irrationally when free shipping is involved and you’re in the business of making money, so do what you can to prod them to make that purchase.
If you want to explore this topic even further, check out our article Should I Offer Free Shipping to my Customers.
If for some reason you cannot offer your customers free shipping without losing money or not realizing a big enough profit, then you’ll have to charge them. But even this has to be done with some thought and care. While free shipping is the ultimate value proposition for a consumer, you can still work on demonstrating that having to charge for shipping can be good for the customer as well.
An example is the time shipping takes. This is a complete hypothetical but if “value shipping” costs $2 and takes 7-10 days to arrive, maybe you can offer 2-3 or 3-5 day shipping for a few additional dollars. This makes the customer feel better having to pay for shipping and you might break even on shipping costs if you’re positioned in a warehouse near your customers and are able to access the discounted shipping costs that many 3PL companies have negotiated.
You can also offer flat rate shipping when making customers pay, so as long as the items fit in a certain size package, it’s the same price. Also, whether or not the shipping is free or paid, customer expectations include tracking numbers to receive real time updates of their item’s journey from the distribution center to their homes.
This all depends on what the profit margin is on your product. For instance, televisions are big items that have higher shipping costs but since there might be hundreds of dollars between the wholesale and retail prices, there is wiggle room for an ecommerce business to absorb some of the shipping costs and offer free or inexpensive shipping to get it directly to a customer. While this is a specialized instance, if you’re selling bigger items that you’d need a large SUV or truck to transport, most customers would be grateful to receive them directly to their homes.
Making customers pay for shipping can benefit you in other less expected ways. For instance, when free shipping and subsequent returns are available, it can lead to more impulsive buys which lead to a double expense for you when those items are inevitably returned. Also it can reduce waste that affects the environment if your customers are more discerning in their initial purchases and don’t make as many returns.
While it’s been outlined in detail that you don’t necessarily have to use a 3PL when handling shipping for your ecommerce business, there are a variety of benefits from doing so. Mostly because you’re likely talking about a company that has been able to maximize efficiencies across the board and is able to offer you outstanding service at reasonable prices.
Speaking of those efficiencies, think about it this way: with a 3PL, your goods are not just thrown haphazardly into a dim, dirty warehouse and then inelegantly packaged and shipped with no thought given to how it arrives to your customers. Quite the opposite, actually. A great 3PL company has clean, well laid-out space for its customers’ products. Many use a Warehouse Management System (WMS) in order to quickly locate your stored goods and employ highly-trained workers who know exactly what to do.
From there, your items are picked and packaged in the right sized box or envelope with appropriate internal materials to protect and secure your valuable items. Then the 3PL can access its partnership with some of the top shipping companies in the U.S. to get good rates on shipping, which it can then pass on to you.
If you have bigger orders that require multiple pallets being shipped at once, 3PLs also have 18-wheelers or can contract with the owners of freight haulers to move your shipment without any problems. So no matter how big or small the orders are, there’s very little for you to have to worry about.
Actually, it doesn’t have to end there either. Many 3PL companies also offer reverse logistics, which means they can process returns on your behalf and also send out new items to customers as well. They can also dispose of or recycle the returned orders depending on your preference.
Now that you’ve figured out how to handle shipping for your ecommerce business, let R+L Global Logistics help your operations take it to the next level. As experts at supplying great service at each step in the supply chain, you can’t go wrong in partnering with us.
First of all, we have the warehousing space your enterprise needs and it’s located strategically across the United States so you can store your goods in a place that works best for you. Our warehouses are climate-controlled and kept spotless so you don’t have to worry about their condition between storage and the products reaching your customers.
Next, R+L Global Logistics is very adept at fulfilling orders on your behalf since they have a lot of experience in that arena. Handling high-volume, fast-paced shipping is also firmly in the company’s repertoire and accuracy on all fronts is what R+L Global Logistics is known for. We’ll fill your business’s orders and get them to the right place in pristine condition.
But that’s not all R+L Global Logistics can take care of for you. We also offer the following warehousing and distribution services:
So when you’re ready to have the shipping for your ecommerce business taken care of by the best in the field, give R+L Global Logistics a call at 866-989-3082 to get a quick, hassle-free quote and see how we can help take your business to the next level.
If you’ve ever thought about the possibility of starting your own business, then you’ve probably heard about the dropshipping process before. The online business model that requires very little upfront investment is causing quite a stir in the entrepreneurial space. The concept might seem overwhelming if you don’t know much about it, but it’s not as complicated as it seems! With a little explanation, you can understand the dropshipping process and get on your way to starting your own online business!
The dropshipping process is as follows:
While the process above may seem simple and concise, there’s much more going on behind the scenes that makes dropshipping happen. Our comprehensive guide below provides you with a complete understanding of the dropshipping process.
Before you move on, it’s important for you to familiarize yourself with these terms.
Supply chain: This describes the entire process of turning raw materials into products and shipping them to customers. If a company is part of the supply chain, it is either a manufacturer, supplier, distributor, wholesaler, retailer, or something else that deals with the creation or movement of goods.
Supplier: A supplier is a person or entity that provides goods, raw materials, or services to other entities in the supply chain. There are often many levels of suppliers. For example, a company may get raw iron from their supplier in the mines. Then, they manufacture that into steel and supply it to another company to turn into car parts. That manufacturer then supplies those car parts to a car manufacturer. That car manufacturer then supplies the finished cars to a dealership, where they are finally sold to the end-user. Each one of those companies is a supplier to the companies that use what they produce.
Entrepreneur: An entrepreneur is a person who takes on the responsibility of starting their own business alone. They often take risks in order to succeed and owe their success to no one but themselves.
Merchant: A merchant resells products manufactured by other companies directly to consumers, rather than for resale. Merchants are also known as dealers, traders, or retailers.
Vendor: A vendor is a person or company that is offering something they made for sale, typically keeping their product lineup rather limited or specific to one area, such as an ice cream vendor, an office supplies vendor, or a clothing vendor. Vendors are typically suppliers for larger retail stores like Target or Walmart that sell a large variety of items but do not manufacture their own goods.
Wholesaler: Wholesale suppliers sell large quantities of goods at relatively low prices to individuals and companies who are not the end-users of the products. Wholesalers ship to restaurants, retailers, and other business users for the purposes of resale or commercial use.
Producer: A producer is a person or company that manufactures, grows, or harvests goods to sell.
Distributor: A distributor is an agent or company that supplies other companies with goods for resale. They can be wholesalers, but they aren’t always. In many cases, manufacturers will give one distributor the sole rights to distribute that particular product, so anyone who wishes to purchase that product must go through the same distributor.
eCommerce: eCommerce means “electronic commerce,” and it describes the process of selling goods online. To learn more about this, check out our article What is Ecommerce Fulfillment?
It might surprise you to know that “drop shipper” isn’t a real title. Dropshipping is a process that involves many people, like manufacturers, distributors, and merchants, so there is no single person who earns the title of “drop shipper.”
Dropshipping is often described as the easiest way to make money online, but what exactly is it, and what do you need to know before you get started?
To put it simply, dropshipping is the process of selling goods online by shipping customers their orders directly from the supplier. Merchants find products that already exist, and develop a marketing strategy to sell those products on their platform. In this way, the merchant works as a middle-man to find more customers for the supplier—while taking a cut of the profits along the way. The supplier benefits from having more customers, and the merchant benefits from being able to earn money on their online store with little to no overhead costs.
The dropshipping process doesn’t require the merchant to ever come into contact with the product they are selling, since the products go directly from the supplier to the customer. Unlike with traditional retailers, there’s no need to worry about keeping stock of inventory, shipping costs, or anything like that. All the merchant has to do is make the sale. This simplifies the process of selling online, and makes it much more alluring to entrepreneurs and people looking to earn supplemental income outside of their regular job.
With all that said, however, you should be realistic with your expectations. Many savvy internet gurus tout dropshipping as some sort of get-rich-quick scheme, but it’s actually not that simple. It’s true that dropshipping is the easiest way to sell online, but that doesn’t mean it is easy. Like any business, running a dropshipping business requires a lot of careful planning and hard work.
Although dropshipping accounts for almost 33% of all online stores, it is usually impossible to tell which online stores utilize dropshipping and which ones keep their own inventory. Behind the scenes, however, the process looks much different from a typical supply chain.
When a customer orders a product from a dropshipping company, integrated software on the company’s website automatically confirms the purchase and immediately sends a confirmation email to that customer. At the same time, it sends out another email to alert the merchant of the sale. The merchant receives the money for the sale automatically as well.
The merchant must then review the order, and forward the order information to the supplier. Along with that, the merchant must also pay the supplier for the price of the item and the cost to ship it. Then, the supplier will pack the item in a box that is labeled with the merchant’s branding, so the customer will see the brand they recognize on the box. The supplier then ships the box directly from their warehouse to the customer. Depending on the agreement between the merchant and the supplier, the supplier may send an invoice to the merchant after fulfilling the order instead of requiring payment upfront.
Finally, the customer receives their purchase with no indication of it ever coming from anywhere but the merchant they purchased it from. Throughout the product’s entire journey, the merchant never had to come into contact with it even once.
In a traditional supply chain model, goods would be shipped to the merchant first, and then shipped to customers from the merchant’s storage. By cutting out that step in the middle, overall shipping costs can be reduced since each box only needs to be shipped once.
By now, you’re probably wondering if this business model is profitable, especially as more and more entrepreneurs turn to dropshipping to earn an income. Well, according to Grand Review Research, the dropshipping industry is expected to grow exponentially with the growth of eCommerce, as more consumers are showing a preference for shopping online. The dropshipping market is projected to be worth USD $557.9 billion in 2025!
So how exactly do you profit from a dropshipping business model? Let’s look at an example.
Say you are advertising a supplier’s reusable water bottles on your website. The water bottles cost around $5 each to manufacture. The supplier charges merchants and retailers $15 for each water bottle, giving them a profit of $10 per bottle. You, the merchant, advertise the water bottles on your site as $25 plus shipping and handling, which also gives you a profit of $10. This works because the supplier never sells directly to consumers. They only sell to retailers and merchants like you, so your prices don’t seem too high.
With that said, the profits you make will depend on the agreement between you and your supplier, the competition in your particular product category, and your personal marketing efforts.
Dropshipping has many benefits that make it an exciting opportunity.
The biggest benefit is definitely the low startup costs. When starting a dropshipping business, you won’t have to worry about buying products to stock, storage costs, or setting up a physical location to conduct business. Since your store exists solely online, and the products get shipped straight from your supplier to your customer, you wouldn’t need to worry about most of the costs often associated with starting a business.
Another important benefit to this kind of business model is the flexibility it allows. Dropshipping doesn’t require a lot of continuous attention, and it doesn’t take much time to keep the business operating. Because of this, people are able to work full-time jobs and manage an entire dropshipping business on the side. Alternatively, someone could run a dropshipping business instead of working a full-time job, and have more time to focus on their hobbies.
In addition to that, dropshipping businesses are easy to scale up. Since you only have to worry about one aspect of your business, you would be able to scale up much faster and more efficiently than if you had to manage all the different aspects of the business yourself. With dropshipping, you wouldn’t even need to hire employees to help you manage the company—unless you wanted to.
Finally, dropshipping is easy to maintain. If you have everything automated with integrated software, your business could continue to operate long-term with little intervention on your part. You could have all orders automatically forward to your supplier, pay invoices automatically, and even have a bot to respond to customer queries. This would make it easier for you to take impromptu vacations or take a day off here and there with little consequence to your business.
In short, dropshipping allows you to run a real, legitimate business at a fraction of the cost and effort of other online business models.
By now, you might be wondering just how you can get started with a dropshipping business of your own. Thankfully, the process isn’t as difficult or intimidating as you’re expecting it to be, as long as you break the process down into actionable steps. It isn’t really different from starting an eCommerce business of any type.
The first thing you’re going to need to do to start your own dropshipping business is to decide what kind of products you want to sell. You’ll need to make sure the products you stock your store with are high-quality; after all, the products themselves will represent you and your business. However, a lot goes into finding a good product to sell—especially if you don’t have any ideas to start with.
Now, when you’re first getting started, it can be really tempting to jump on whatever the newest trend is, but you should be really cautious about trends. Take fidget spinners, for example. Back in 2017, these spinning toys saw explosive popularity, and entrepreneurs all jumped on the chance to stock up on them for their stores. However, the craze disappeared as quickly as it began, and many business owners were left with overflowing stock and no demand. Although you wouldn’t have to worry about stocking up with dropshipping, you still wouldn’t want to waste time and effort on a product that ends up flopping. If a product seems too good to be true, it probably is.
To find a good product to sell, a good place to start is to think about what interests you. If you have any hobbies, think about the kind of equipment you use. If you play football, for example, you would need a ball, a mouth guard, a helmet, and many other pieces of equipment. If you’re a painter, you know you need to buy paint, brushes, canvases, palettes, and much more. Any one of those items could work, but it’s important to remember that this stage in the process is just for coming up with ideas.
Once you have some ideas, you need to narrow it down until you have one or two types of products. You can, of course, expand your store to include many different items, but you should start small if you’ve never done this before. Here are some tips for eliminating products from your list of ideas.
If you decide to grow your product line later on, you should try to find products that relate to the ones you are already selling. If you’re selling soaps and bath scrubs, you could add things like lotions or balms to your website. If you sell keyboards and mouse pads, you could expand your product line by finding other office supplies to dropship. If you only sell a random collection of products that don’t fit into a similar theme, you may lose some credibility with potential customers.
Once you have decided what you want to sell, you have to find a supplier. One of the most popular options for sourcing dropshipping products is through the massive online marketplace, AliExpress. AliExpress is tremendously popular for several reasons. For one thing, many of their sellers already understand that buyers are looking to resell their goods, especially with dropshipping. Because of that, it is much easier to find suppliers who already offer dropshipping options.
With that said, AliExpress is the most popular option, which means that each supplier is already likely supplying its products to many different sellers. To find products that are more unique, you may have to look elsewhere. Some alternatives to AliExpress for dropshipping include DHGate, DX, and Lightinthebox.
If you decide to search for a supplier outside of a large marketplace like those listed above, you should be extremely cautious about scams. Once you find a supplier, make sure you look for information on them, including how many shipments or sales they have made, what their reviews are, and whether or not they avoid answering any of your questions.
Remember that not all suppliers are going to offer dropshipping services. You need to reach out to each potential supplier to make sure they clearly understand your expectations.
Creating a website might seem like a daunting task, but there is a variety of software available that can make the process easy. For example, sites like Wix and Weebly allow you to create a website online for free, and they’re easy to use! You can simply drag and drop assets onto the screen to build the front-end of your website easily. However, there are drawbacks to these types of website builders: they tend to be slow, it can be difficult to create consistent branding across the site, and not all the functionality is going to be actually free.
Another option for creating a website is through the open-source software offered by WordPress. It’s more difficult to use than a website builder, but it will allow you more freedom and creativity on your website. It also integrates well with many plug-ins that make eCommerce easier, such as WooCommerce.
However you decide to create your website, there are a few things you’re going to need to keep in mind to ensure the best customer experience. Here are the most important elements to an eCommerce store:
If the learning curve of creating your own website from scratch is too steep, you could always hire someone to create your website for you. Depending on many different factors, a designer or developer may charge anywhere from $200 to $6000 to create a site for you, in addition to an ongoing charge if you want them to manage your site over time.
While we provide a brief overview of launching your dropshipping business, check out our full article on How to Start a Dropshipping Business for even more information.
Once you have a dropshipping business set up, you’ll quickly get tired of seeing only a few sales every now and again. If you really want your business to take off (and continue growing), you need to start advertising!
Advertising is at the heart of all successful dropshipping companies, but if you’ve never done something like this before, it can be overwhelming. There are many different ways to advertise an online store, and you may end up using all of them, a few of them, or only one! If you find something that works for you, your product, and your business model, then you should put all your energy into that instead of diluting your attention over multiple different advertising channels.
Here are some advertising ideas to get you started:
Although dropshipping has many benefits, it isn’t all fun and games. Like any business model, it has its fair share of drawbacks. Here are some of the challenges you might face with a dropshipping business:
There are plenty of good reasons to pursue dropshipping as a business model, but you should always remember that there are trade-offs. The low barrier to entry and ease of managing a dropshipping store comes at the expense of more control and higher profits. You have to decide what it is you want from your business and make your choices based on your personal goals. No single model is definitively better than another, and you may try a few different strategies before finding what really works for you.
Dropshipping is a great way to get started with a business if you don’t have a lot of money. However, you may decide to change your business model later on, or you may decide that dropshipping was never in line with your goals for your company. Either way, if you’re looking for alternatives, one idea may stick out to you more than others.
Most of the disadvantages associated with dropshipping involves the lack of control that business owners get over their supplier’s inventory. So, many of those problems could be eliminated by managing your own inventory. Buying products at wholesale prices and fulfilling them yourself is more expensive upfront, but you would be able to make much more profit on each sale. You can cut shipping costs, offer more personalized shopping experiences for your customers, and ensure the quality of each item that gets shipped out. You may even be able to continue getting your products from the same supplier, and just save money by making bulk orders instead.
Managing your own inventory can be a challenge. You’ll need to have a solid understanding of demand planning, inventory management, and order fulfillment strategies in order to ensure your success. There are more upfront costs, and mistakes can have larger consequences for your business. More reward comes with more risk, after all. But… What if there was a way to get the best of both options: both the convenience of dropshipping and the profits of managing your own inventory?
If you take control of your own inventory, you will have a new opportunity to help you manage online orders and fulfillment: a Third Party Logistics (3PL) Warehouse. 3PLs offer you the same convenience as dropshipping, since you wouldn’t need to worry about storing goods or shipping the products yourself, but with many more perks. Your customers could enjoy more customization and shorter shipping times, while you can reap the rewards of having a personalized contract with a competitive fulfillment company. This will save you money and free up your time to continue expanding your business.
R+L Global Logistics is a leader in the warehousing and fulfillment industry. We offer competitive pricing and outstanding customer care, so you can just relax and let the pros take care of everything. We’ll treat your business with the care and efficiency that it deserves, so you can rest easy knowing your inventory is in good hands.
In addition to the standard fulfillment process, we also offer a range of value-added services that you can’t get with the dropshipping process. These services are:
When you’re ready to break away from the dropshipping process and start managing your own inventory, turn to R+L Global Logistics to be your trusted partner. You can request a quote online, or reach out to us at (866) 989-3082 for more information today!
Providing devices for hospitals, doctor’s offices and everything in between isn’t like selling many other types of products. There are quite a few things you must be cognizant of, like how to store the devices and making sure both the devices and how they are handled are in accordance with the Food and Drug Administration’s (FDA) regulations. In this regard, choosing correctly between many different medical device logistics companies is of the utmost importance and shouldn’t be taken lightly. So you might be in a bit of a bind trying to figure out the correct steps to go about this.
Choosing a medical device logistics company should involve the following steps:
In our comprehensive guide below, we take a close look at each step giving you a complete look at exactly what needs to be done to find the right medical device logistics company.
It’s hard to “rank” the steps in choosing a logistics company to handle your medical devices, but it is easy to immediately cross the company off the list if they aren’t in compliance with the regulations and best practices set forth by the FDA on handling the items.
First off, let’s talk about what constitutes a medical device. One might immediately think of complex technology like MRI or x-ray machines but in truth, a medical device as defined by the FDA can be things as simple as tongue depressors or ubiquitous tools like blood glucose readers. These products are much needed by the healthcare industry and healthcare system, so it is necessary that the various medical devices are readily available.
There is actually a section — 201(h) of the Food, Drug & Cosmetic Act — that covers what the FDA defines as a medical device. To summarize, there are three determining factors that can lead to your item being classified as a medical device:
Once you’ve been able to decide if your product is a medical device based on the above criteria, then you can check the FDA Product Classification Database to check if the devices you plan on making available are in a classification that already exists. While looking to make this call, there are a few things you can do:
One thing to note is that software, whether in the form of a computer program or mobile application can be considered a medical device. This gets its own designation of Software as a Medical Device (SaMD).
Once you’re certain that you have qualifying medical devices that are in regulatory compliance with the FDA, the next step is to find the ideal place to store your products until the time they have to make it to the end user.
This in itself is a step toward finding the right logistics company to partner with for your medical devices, so it should definitely be taken seriously. The first step, if feasible, would be to personally walk any warehouse that you’d consider having your products shipped to in order to be stored. Since medical devices can range wildly in price, you’d want to make sure your items are being taken care of properly. If touring the warehouse is unfeasible for any reason, then do your own research on the matter. With the prevalence of the internet, you’ll surely be able to read reviews of logistics companies to get some kind of feel for them.
For medical devices, especially any with electronic components, you want them stored in a clean, climate-controlled warehouse. While the medical devices shouldn’t be perishable, they should be kept in the best possible conditions regardless. Besides that, the warehouse (to the best of your knowledge) should be logically set up to maximize efficiencies and to safeguard the integrity of your medical devices.
Also, many warehouses have a Warehouse Management System (WMS) that keeps track of where and how much of the devices are in the building. These are helpful because the logistics company can share that information with you, mostly the quantity, so you can more accurately have orders filled and know when to send more medical devices to the warehouse.
Another important aspect of a warehouse is its location. Let’s say your company operates out of Seattle but you do a large amount of business in New York City. The warehousing you’re offered should be in close proximity to where the product needs to end up, or in a good centralized location if it will be distributed to many points across the United States easily.
So in summary, look for a temperature controlled warehousing solution in a location that works for your business.
You could make a strong argument that this should happen before or during the process of looking over the warehouse but we are putting it next because if you don’t like where the warehouses are located or how they appear to be run, then you won’t care about this step.
But this is extremely important in many regards because the only way a logistics company will be FDA registered is by being in compliance in all the areas required. The condition of the warehouse (as mentioned above) needs to be safe and clean if it is to be registered with the FDA. This means free of any pests such as rodents or insects.
While this next requirement could be more for perishable goods, it is still nice to have even for your medical devices. That is a labeling system which is clear and accurate. Some of the things that are needed on the labels are any expiration dates, requirements for temperature or batch numbers. Specifically for medical devices, the labels provide a clear view of the chain of custody, which is a must for the FDA. Another thing that is similar to labeling requirements is lot control systems.
These systems are put in place so that items throughout a warehouse are stored together properly and in an orderly enough way that they can be easily accessed at a moment’s notice. The system is put in place to separate goods from different batches or brands from one another. The lot control system would also be helpful in lowering costs if any recalls were to occur.
Any FDA warehouse must go through regular inspections, maintain prevention plans for accidents or other emergencies, and also handle product recalls. The building in many cases should be properly secured, meaning not just anyone can walk in and out of it, and have access to your medical devices.
This is specific to exactly what you’ll be storing and any warehouse that provides fulfillment services for medical devices. But the FDA registered logistics company you decided on should be able to accommodate both Class I and Class II medical devices. The main reason the FDA ranks medical devices into classes is to denote the level of risk to both the patient and the healthcare professional using them.
You want to make sure that Class I and II can be handled and that the logistics company can also deal with the extra labeling needed by Class II medical devices.
So you’ve confirmed that the third-party logistics (3PL) can handle properly storing and handling your medical devices, and is also certified by the FDA. But what is the plan for getting your items from their warehouses to the actual customers? Healthcare logistics can differ slightly from normal logistics but there are some basic things your 3PL company should be able to offer you in the form of logistics solutions.
First is readily available trucks to deliver your products to anywhere in America. Those 18-wheelers should be able to be ready when you need them to transport your medical devices where they need to go. If for some reason an 18-wheeler won’t work, a completely covered 3PL can provide vans for smaller or more secure shipments, or even have partnerships that allow for the use of ocean, rail or air freight shipping as an option for times when that will work the best.
Besides the ability to simply put stuff on the road, sea or into the air, you should also be looking at their stated on-time arrival rates or incident reports (if those numbers are available). This can show you that the transportation for your medical devices is not only prevalent, but that if you agree to have the 3PL in question shipping your products, that they’ll get there on time and have everything in perfect shape. No matter what happens, you should be comfortable with the transportation services provided.
While it might be hard to obtain some of this information, it’s also good to make sure the 3PL you’re looking at has financial might and is in good shape in that regard. Depending on your needs, domestic transportation might be enough but it also might be nice if they have a global network in place should you ever require that kind of reach.
One of the services your business might need is cross docking. A cross docking facility enables your medical devices to quickly be transferred from one truck to another without the need for short term storage in most cases. R+L Global Logistics offers cross docking services through multiple facilities across the U.S.
While the medical device logistic company you’re looking at might store it and ship it on your behalf, it’s fair to wonder if they will also fulfill orders at your behest. Order fulfillment is the process in which the 3PL has your medical devices stored in their warehouses and then packages or otherwise transports your items to the end user after receiving the order from you. This is a very prominent step in the list of supply chain solutions since it makes a lot of sense that if you’re using the warehouse storage of a 3PL — in most cases — you wouldn’t want the stuff sent back to you so you could ship it yourself.
Just like the steps before though, it’s not going to be good enough for them to throw your stuff into a box or leave it packaged generically if presentation is at all important to you. So you need to figure out if they can fulfill the orders in a way that portrays your business in the best way. If you have a company do your warehousing, order fulfillment and shipping, you must realize your medical device products are out of your hands and you must have a business partner you implicitly trust since the next time you might hear anything about it is from the customer after it’s been received.
If you’ve determined that the medical device logistics company offers the warehouse fulfillment services that meet your needs, then you can move onto the next step.
Whether it’s medical devices or any kind of products, a manufacturer or wholesaler can’t escape the inevitable: having to deal with returns. This can be handled one of two ways — you can have the customer ship the item directly back to you, or you can have the 3PL company who originally fulfilled the order also deal with returns — otherwise known as reverse logistics.
An outstanding medical devices logistic company can actually offer customized solutions for you, so that returns are processed the way you want them to be. There are different options that each have their own benefits:
You can have the 3PL do everything: If you’ve trusted them with everything up to this point and don’t want additional headaches on your plate, this can be a great option. Under your instructions, the 3PL can ship back out a new product to the original customer while then disposing of, recycling or salvaging usable parts or materials. Having the items disposed of or recycled prevents them from being re-routed to you and the salvaging of resources from a non-functioning medical device can be both cost-efficient and environmentally responsible.
You can instruct the 3PL to accept returns and then ship them back to you: If you want to be more hands-on with how returns or dealt with, or want to make sure the recycling/salvaging process is done the exact way you want it, you could have them shipped to the 3PL for initial intake, they can separate it into one of the the three categories, throw away the garbage and send the rest back to you so you can determine what is able to be recovered.
You can have the 3PL company not engage in reverse logistics: If you want total control, then have any customers who have problems with their medical devices send them directly back to you. If they need a replacement product immediately, you can have the 3PL fulfill that but you deal with the actual broken or non-functioning products yourself.
Now that you’ve seen what medical device logistics companies do and the steps needed to pick the right one, hopefully it’s become evident that you should pick up the phone and call R+L Global Logistics right away. Experts in the business, R+L Global Logistics is the best company to handle the logistics of shipping your medical devices.
R+L Global Logistics truly has everything you need to support your business throughout the entire supply chain. As an FDA-registered provider, we can store your medical devices in a warehouse in a location near where you need it. Also, we know that some medical devices need to be kept free of heat, humidity or moisture, so R+L Global Logistics offers climate-controlled storage as well.
From there, R+L Global Logistics can also engage in order fulfillment on your behalf. This can be in the form of pick and pack fulfillment for smaller medical devices or placed on the back of an 18-wheeler or dry van and shipped right to the customer by us for you.
We also handle other aspects of the supply chain such as reverse logistics (returns), cross docking transload and general 3PL warehouse services. Also included in any service we provide for you is our outstanding knowledge, work ethic and industry-leading customer service.
So when you’re ready to explore which medical device logistics companies offer the best overall value, look no further than R+L Global Logistics. Give us a call at 866.989.3082 today for a free quote.
Maybe you’ve heard that there are people in the world making money doing something called dropshipping and now you have a very important question of how to set up dropshipping as your main business or even as a lucrative part-time endeavor.
To start a dropshipping business, you'll need to follow 6 simple steps:
Each step is vital to the overall process and has important details that can't be overlooked. Our comprehensive guide takes a close look at each step to give you a full picture of how to start a dropshipping business.
So you’re looking to start your own dropshipping business from scratch and are looking for the simplest, most straightforward path of how to set up dropshipping. So before we barrel into the steps needed to have a successful dropshipping enterprise, let’s really define what dropshipping is and how it benefits both you and the customers you’ll be providing this service for.
Dropshipping is the practice of buying goods wholesale from a vendor, but having that same vendor fill the order and ship it on your behalf. In this setup, you make the difference between what the items cost and what consumers purchase them for. So a dropshipping operation never actually has the goods in its possession nor is it ever the one responsible for fulfilling and sending the order.
A quick example of this is finding wholesale items to buy on AliExpress (for instance) at low prices. Then you create a listing on another marketplace like eBay or Amazon and sell the items there. You’d then place the order on AliExpress, who’d send the items to the customer. Where the dropshipper profits is the difference in cost between those two items. Depending on how high the disparity is between those two prices, dropshipping can be quite lucrative.
You can also start up a dropshipping business with very little upfront cost, which also makes it attractive. But you might ask yourself what is in it for everyone involved? Well here’s a quick breakdown:
Now that dropshipping has been clearly defined, let’s talk about the simple steps that need to be taken in order to start such a business.
This one might be the most simple step of all — you need to decide what you plan on selling. While knowing you have to do this is the easy part, the process that goes into doing it is a bit more complicated. Just saying you’re going to sell, for example, flashlights sounds like a breeze but you need to factor in the following things when you find products to potentially sell:
If the answer to this question is not yes, then you’re probably targeting the wrong product to sell. Because if you can’t answer yes to this, then little else matters. This is a good opportunity to look for ways to maximize your profits. As an example, if selling a $10 item takes the same amount of work as a $1,000 product with a much higher profit margin built, you should consider the latter if possible. Of course, there must be a market for a good with a high price, but your goal should be to work smarter, not harder.
If you’re selling an item for $15 but shipping costs you $5, that might be too great of a cost for you to actually turn a profit. There are a few things you can do to bring the cost of shipping products down:
You can use Google to determine if people are even searching for what you plan to sell. This might seem like a silly thing to have to sit down and consider but the last thing you want as a dropshipper is to be sitting around taking little to no orders and — even worse — not having any answer as to why. Establishing a conservative estimate on what you expect to be able to sell at the onset is important to both manage expectations and also see if it appears that the products you picked will be worth offering long-term.
This will also involve sitting down at a computer and using Google Trends to look for search terms that consumers are using in order to search for the type of products you’re thinking about selling.
If you lived in a small town where 10 other businesses sold strawberries, that would understandably not be your first choice. So here, you need to at least make sure you’re not selling things that are readily available in close proximity to your customers. That doesn’t mean the products you choose for your dropshipping have to be rare or exotic — just that if people can go to the local Walmart and pick them up for a similar price, they’ll have much less incentive to order online from you.
Of course, if your item is similar but has additional specifications that would make it more attractive or a unique aspect like the design, color or enhanced options, then iterating that will be important to customers so they realize that you add value.
If you are starting a business, the last thing you might want is for the packaging of your products or the shipping materials to reflect that you’re not the actual seller of the item or that your sourced items can be considered of low quality. Perception can go a long way when it comes to how consumers consider whether or not they’ll buy your stuff.
If the wholesaler who is dropshipping on your behalf has an option to use more sophisticated product packaging, even if it is for a small additional cost, it might not affect your bottom line too much. However, it might be the difference between a sale and non-sale in a customer’s mind, especially in a sea of similar competitors.
This was touched upon briefly above, but let’s get deeper into the weeds and define what this truly means. You’re looking for a sweet spot in the marketplace — you want there to be some competition for the product because that indicates there is demand for it, but you also must be mindful of who that competition is and make a determination on if you can beat them or not.
You will be going against every other dropshipper or retailer who is also selling those products and even if the space is not jam-packed, you could be going against some giants who have more resources, selections and possibly even the ability to sell for the same price or cheaper. However, if these companies are selling the same products, it should tell you that a sustainable business model must exist for it.
Conversely, if your research turns up no competition, it’s imperative you figure out why that is. People aren’t going to let free money not be made, so there could be a variety of reasons it’s untapped:
So in summary, too much competition and little to no competition can be a recipe for disaster. While doing a bunch of research can seem boring and tedious, it can truly be the deciding factor between failure or success.
Congratulations for making it through the first two steps. At this point, you must have picked out your products and done the research to realize you’d be in the competition sweet spot. At risk of making this article sound like each step is life or death, the next crucial aspect is finding the right dropshipping supplier.
While the idea of these steps are simple, the importance in nailing them cannot be overstated. Your potential suppliers naturally exert a lot of control over the customer experience, so if you partner with one that is unreliable in any way — whether it be late shipping, being unable to fulfil your orders or fulfilling your orders incorrectly — you’ll run into problems.
There’s a great likelihood that suppliers will be located outside of the U.S. and even overseas. So pay attention to their demonstrated ability to communicate clearly and quickly. Unless you’re fluent in the native language of the supplier, it might be important to you that they’re able to write and converse proficiently in English to conduct business.
A website such as Alibaba is great for connecting dropshippers and suppliers, and can allow you to test out different dropshippers to find the right fit for you. Alibaba itself will offer support in helping in that regard but — for the most part — it is up to you.
Another important thing to take into account is if the supplier you choose has the capacity to fill your orders as your operations grow. Even if the price and products they provide you are great, those aspects could be of little use to you if you have a great potential to expand yet can’t because you can’t get the amount of items you need.
There may be a point in your business where you're in need of on demand warehousing. To learn more about this, check out our article that covers on demand warehousing.
So you’ve got a supplier ready to start helping you fulfill orders, you have to figure out how you’re going to actually accept orders. As a dropshipping business, the most inexpensive — and probably most effective way — is having your own website.
The interface should be simple and clean. There shouldn’t be a confusing setup or layout that hinders your customers’ ability to place an order. You don’t want to give the consumer a single reason to want to bounce from your site, least of all because they can’t figure out how to go about the transaction.
In fact, a company such as Shopify could be very useful in this regard. Shopify is a company that offers solutions for ecommerce businesses where you can pick from simple website designs and a great platform that helps you and your customers complete transactions. When using Shopify stores, it can look like you have your own website or marketplace even when it is being hosted by another company.
At least initially, especially if every cent is important while launching this new endeavor, it will be much cheaper than either hiring a freelance web and development team, or establishing one in-house. If you want to eventually develop your own website from scratch, you can once you are certain the business model is working and some positive cash flow begins occurring.
The website also further distances the connection between the fact that you are dropshipping. There’s no shame in dropshipping, but if you want to create your own enterprise, it might be advantageous to not highlight that you’re not producing the products yourself or that they are really being ordered from and fulfilled by an outside company.
You’ve got the killer products from the right supplier and now you’ve got your plan to have a healthy internet presence via an ecommerce store or other ecommerce platform. Yet even if you’ve done everything right up to this point, that doesn’t guarantee that customers will be there waiting to place those important orders.
You’re going to have to engage in some sort of advertising to let people know you exist. While just hearing the word advertising might sound expensive, it doesn’t have to be at the initial level you’ll need. There are several smaller things you can personally do to get the word out without spending too much money.
One of the most efficient ways to advertise might be to tap into the large audience already sitting on Facebook. Facebook ads are relatively cost-effective and will get your dropshipping business in front of many pairs of eyeballs. Other than just straight advertising, you can also give prospective customers special offers during your Facebook ad campaign. In this one respect, you’ll be on level footing with other dropshipping businesses and even retail giants.
Besides Facebook, there are two other areas that you can give attention to that may not pay huge dividends right away. The first is compiling an email list; it could be as simple as having people create accounts to check out on your website, or allowing them to input an email address to get a discount. As your business grows and you have the contact information of more and more customers, you can advertise to them directly by emailing them.
The last thing to look at is getting the ball rolling to make Search Engine Optimization (SEO) work for you. The short description of what SEO is — it is setting up or creating written content for your site that will help it rank high when people search for certain terms on search engines such as Google or Bing. The point of doing this is so customers will see you in the search high enough that they’ll be compelled to click on the link and then that will lead to a sale for you.
Steps 5 and 6 cross over into the realm of eCommerce which is a massive topic in itself. To learn more about the eCommerce side of things, check out our article on how to start an eCommerce business.
The stage is now set for you to begin selling and seeing if you’re doing everything you can to maximize traffic and subsequent sales to your business. This means familiarizing yourself with Google Analytics or Facebook conversion pixel data. These allow you to figure out exactly how many of the clicks you get led directly to a sale and if it was from the particular platform.
The reason this is so valuable is you can get a real-time look, or a portrait over a certain period of time to see exactly what worked — and also what didn’t. This allows you to shift resources from a less valuable area to one that’s more valuable, or even eliminate products or promotions that have little to no interest from consumers.
These can even be helpful tools in clueing you in on when it’s time to expand your business or even just stay the current course. If you don’t already know, things change in the business world at a rapid pace. There is no standing still and analytics will assist you in knowing not only how to change but when the correct time is.
Now that you’re well-versed in how to set up dropshipping as your personal business, give the supply chain experts at R+L Global Logistics. We can assist you with your dropshipping endeavors to make the steps in doing so even more of a breeze.
You can have your items shipped directly to R+L Global Logistics’ warehouses, which are located strategically around the U.S. We will store them for you and then fulfill orders on your behalf when the time comes.
We also offer additional warehousing and distribution services that include but are not limited to the following:
Along with all of our services, you’ll have the expertise of a fulfillment and logistics partner available at all times.. We’ll go the extra mile to make sure your orders are accurate and in great shape when they reach your customers.
So where you’re ready to figure out how to set up dropshipping and require the best in the business, give R+L Global Logistics a call today at 866.989.3082 for a free quote and learn more about how we can help your burgeoning business truly thrive.
Amazon is the king when it comes to online commerce in the United States, there’s little question about that. So it stands to reason that anyone selling products to consumers would want to be on Amazon’s prime platform. But maybe there’s a valid reason why you don’t want to sell through their website, yet don’t know of any alternatives to selling on Amazon.
However, the online giant isn’t the only game in town. There are many alternatives to selling on Amazon, plenty that could be just as good or possibly better depending on your objectives. Names like eBay, Walmart and other specialty sites can provide just what you’re looking for. Keep reading for a full scope on the subject.
Just as important as the platform that you sell your products on is the partner that you choose for fulfillment and distribution. Our team at R+L Global Logistics has the experience and knowledge to handle this critical step in the supply chain. Request a quote today to find out how we can meet your supply chain needs.
If you only remember the days where you had to bid against others to secure your coveted goods on this website, then you haven’t been on eBay — which is at the forefront of the Amazon alternatives — in quite some time. While you can still try to score a deal via the auction system, eBay now has two things that make it a great place to sell you products: Buy It Now and eBay Marketplace.
The first option, Buy It Now, is still linked to the auction system. But with Buy It Now, the seller can also set an exact price that they are willing to accept for a sale that will automatically purchase the item on the buyer’s behalf. This isn’t much different than a regular purchase since you’re looking over a new or used product, deciding if the price is right and then checking out.
For eBay sellers, the Buy It Now option is used in conjunction with the auction system, so you can still receive bids on your products if that’s your preference while setting a price that you’re comfortable receiving that the buyer can trigger immediately. It is a win-win in that regard. eBay also has its marketplace, which is more like a traditional website setup for an online store. Here, you set prices like normal and customers buy.
The other major benefit to start selling on eBay is the secure marketplace. eBay has protections in place to protect both the buyer and seller and, in conjunction with accepting all major credit/debit cards and also its sister site PayPal, there are a myriad of safe ways to collect or make payments that should give both sides an additional peace of mind.
While it’s not a “downside” per se, eBay does collect a percentage on each sale made. So you will have to factor that into the prices you set in order to still hit your intended profit margin. However, this is no different than Amazon in that regard, so it’s not an additional cost versus selling on that site.
Years ago, it would have been unfathomable to sell your ecommerce goods with America’s largest brick-and-mortar retailer. But Walmart’s major expansion into the digital marketplace has been massive and now allows online sellers to tap in to their 100+ million visitors to their website each month alone.
Besides the ability to reach a lot of new customers that you might otherwise not have access to, your items are listed right alongside Walmart’s own listings. While there is a notation on your goods that they are being sold by an outside source, the listings aren’t any different
Walmart marketplace doesn’t make you pay a monthly fee to list items on their website like Amazon but you will be on the hook for a “referral” fee. Depending on what kind of commodity you’re selling, you will be charged a percentage ranging between 6 to 20 percent on each item sold.
Walmart allows sellers to list goods in more than 35 different categories and — while the retailer’s website is growing rapidly — there is still far less competition than on Amazon, which boasts over 2 million unique sellers. In addition, you will also see your products listed on Walmart’s other site such as moosejaw.com, jet.com and shoes.com.
Unlike a new website that hasn’t built credibility yet, the Walmart name is well-established and has the trust of consumers. Furthermore, Walmart accepts all major types of payments, so you can use a debit or credit card, or even some forms of electronic payment like PayPal.
Walmart.com, however, is not perfect for ecommerce sellers. Because Walmart’s mission is to offer customers the lowest price possible, there will be pressure on you to do so as well. In fact, if you listed your item for what Walmart deems to be too high a price, it has the ability to de-list your items. And in another contrast to Amazon, you will be expected to handle customer service for consumers who purchase your goods. Amazon usually does this for its sellers.
This deserves its own analysis since it is owned by Walmart but operates as its own marketplace. Bought by the large retailer in 2016, Jet.com has a lot of cool features that both buyers and sellers enjoy. From a buyer’s perspective, you can get additional discounts by taking small actions such as bypassing the option for free returns, providing your email address or adding a certain amount of items to your cart.
Sellers prefer it over other platforms in some cases because of its relative ease of use. You have to apply to be able to sell on jet.com and also have to be able to integrate into their Application Programming Interface, but their low fees and uncomplicated setup will entice both consumers and those selling their wares. Just a 15 percent commission is exacted by jet.com in many categories.
This is fairly similar to selling your goods with Walmart but there are a few differences to consider. Target is only courting currently established businesses, so newcomers to the field might not be approved. Even if you are more experienced in the retail forum, Target accepts businesses only by invitation.
Target Plus — as its online sales business is known — does offer its affiliated businesses a personal storefront on its website and just like with Walmart, sellers are strongly linked to a trusted brand in the Minnesota-based company. Unlike Walmart though, Target’s online presence is currently smaller.
Neither company offers you fulfillment options, leaving that to you or a third-party logistics (3PL) company you’ve contracted with to do work for you. Thankfully, we've got this covered for you. R+L Global Logistics is a full-service 3PL fulfillment and distribution provider. You can rely on us for all of your fulfillment needs.
Overstock.com, like several on this list, had modest beginnings but has since grown into a billion-dollar enterprise. Selling on Overstock is not much different than doing so on Amazon or eBay and can be lucrative.
For a seller, you must be approved by Overstock in order to peddle your wares on their website and you’ll be expected to handle all questions or returns, meaning Overstock doesn’t deal with customer support on your behalf. It is free to register, however, and you should encounter reasonable transaction fees. For instance, items $25 or under see a $0.10 listing fee and 3 percent transaction fee.
Your listings can also be spruced up through bold text and other flair for an additional cost, so you’ll need to create a budget beforehand to make sure you’re not overspending on needless advertising.
As a potential negative for selling on Overstock, customers flock to the site in order to purchase name-brand items. So if you’re selling off-brand or not widely recognized brands, then you might be better off elsewhere.
Overstock doesn’t have every category for items, but still emcompasses a wide range which includes but is not limited to:
For a buyer, the good thing about purchasing items on Overstock is your credit card info will only be shared with Overstock and not the third-party sellers, which becomes handy if you place multiple orders with different retailers on this site.
If you’re selling anything in the realm of electronics, whether it’s computers, their accessories, video games or anything adjacently related, NewEgg might be for you. This online electronics giant has branched out to include some other product categories such as:
As a seller, NewEgg is great for a few reasons. You just need to apply and tell the company about your business and there’s a good chance you’ll be accepted to begin listing your items for sale. You have the option to additionally promote your listings on the website and also do order fulfillment yourself or have NewEgg ship to the customers for you. As an additional benefit, NewEgg collects payments for you and then disperses them to you on a weekly basis.
The business does offer three tiered memberships for sellers: one is free, the Professional tier is $29.95 per month and the Enterprise tier is $99.95 per month. If you have a straightforward operation with 5,000 item listings or less a month, you can easily use the free tier. The two paid tiers do unlock more options and even discounts for sellers. As always, it’s important to do your own accounting and see if a paid tier will be ultimately beneficial to your business.
And customers love NewEgg for its sterling reputation for selling a variety of goods at competitive prices while allowing for returns.
Bonanza is another site where you can sell goods in a fashion like Amazon or eBay. While not as large as either of those companies, Bonanza does have some cool features that make it a worthy alternative to the traditional avenues of selling online.
For seller accounts, Bonanza sets up online marketplaces known as booths. This means instead of your items being listed all over the site, everything you’re selling is on one page which customers will see after clicking on an item they’ve searched for initially. This is great since it might allow you to sell multiple products to a customer at once.
Reasonable fees are also a trademark of Bonanza, where if you sold an item for $20, you’d be charged just 3.5 percent — or 70 cents. If you’re able to sell items for over $500, the percentage charged by Bonanza goes down as well. However, the site does institute a minimum of 50 cents per transaction, so this can cut into the sales of smaller valued products.
For a slightly higher percent fee, the website will actually advertise your item on the internet. Also, there are a large amount of different categories to list items in and you can sell both new and used items on Bonanza. Like some other sites, Bonanza does highlight popular brands but doesn’t make it mandatory for your items to be from well-known makers.
Fruugo is more seller-friendly from the perspective that you aren’t charged for a listing. You only pay a fee after the sale of your items. There are also no membership fees of any kind. You’ll also receive a dedicated account manager to offer assistance and also be able to accept payments in many different forms and currencies, which are converted into your currency of choice.
Fruugo has more of an international flavor as a UK-based company that ships to many countries that comprise 28 unique languages. Fruugo also provides complete protection against fraud and also has designed its interface to be friendly to mobile phones, desktop and tablets.
The only potential downside, if you want to even call it that, is it’s relatively new and small compared to other marketplace-style websites. Also, on certain items, the pricing seems to be inconsistent to what you can find at traditional retailers. So those are definitely things to keep an eye on.
This is another option that is in its own category since it is somewhat specialized. Alibaba is the world’s largest business to business marketplace. So you wouldn’t be selling individual items to consumers, but both small and large-scale orders to other businesses. AliExpress takes it a step further as it is mostly used as a dropshipping marketplace, meaning that you purchase items from a country such as China and AliExpress fulfills the orders on your behalf, allowing you to make a profit without having ever had the products in your actual possession.
The great thing for sellers about Alibaba or AliExpress is you have access to millions of customers all over the world who go to the two Ali sites because they’re trusted sources for inexpensive yet quality products in a large range of different categories. Alibaba, like some others on this list, have tiered memberships for sellers which run from a free basic membership that is somewhat limited to a premium one that unlocks all the options and benefits to the site.
However, Alibaba does share some of Amazon’s negatives as well. Both marketplaces are very high in competition, so it can be somewhat hard to turn a profit.
These two options are grouped together because they share the same setup, which is different from the other ecommerce websites. Basically, with Shopify and Square, you are paying them a monthly fee to allow you to have your own webpage and marketplace where you can sell all of your products.
From there, you can build a website with pre-made options, so you don’t need web design experience. Where Shopify and Square make their money is by being the platform in which payments are processed. Each takes a small percentage of the sale plus a small flat fee. You will do your own order fulfillment with these sites but it can be a preferred option if you’d like more overall control over your day-to-day operations.
These two sites also offer both customer and seller support, while also being able to share analytics with the seller to figure out why certain items sell well while others don’t. The other cool thing about both Shopify and Square is you can use them on the go, like if you’re in a real-life marketplace or festival selling your wares out in public.
Granted, this doesn’t have the same luster as having your own listings or marketplace on a site like Amazon but they do have some benefits that could make them attractive to those looking to maximize their profits.
First of all, let’s start with Facebook Marketplace. If you have a Facebook account, you can start a free marketplace profile and begin listing items. You have to list a price, description of the item and at least one photo, but that’s all it takes to be up and ready to sell. This takes more care and time to sell locally since you’ll be required to meet the buyer in person, which you should also do at a safe location during daytime hours to protect yourself. There are also not the same level of buyer or seller protections in place as Amazon. You will see pictures and profile information on Facebook, letting you familiarize yourself with the person you’ll be dealing with, which is a positive.
You can also choose to ship your items, but Facebook Marketplace — like many of the other sites — will charge a small percentage for any item not sold locally. This is of course safer than meeting in person but will cut a little more into your bottom line through shipping costs and Facebook fees.
Craigslist is also an option but doesn’t have the same level of safety. It might be completely unadvisable to ship items using Craigslist, since there’s no buyer or seller protection in place. You’re selling at your own risk. Craigslist does have a wide reach though, so selling locally could be lucrative. But just like meeting someone on Facebook, if you can’t stomach the idea of doing most or all transactions in person, Craigslist will not be for you.
If you’re planning on pursuing alternatives to selling on Amazon, you could probably use assistance on some of the front-end logistics by helping with fulfillment and distribution services. So look no further than R+L Global Logistics to get that helping hand you could use to take your ecommerce business to the next level.
At R+L Global Logistics, we can offer everything you’d need to successfully sell on any ecommerce site from eBay to Walmart and all formats in between. First off, we have ample 3PL warehousing space across the country to safely and securely store and then distribute your valuable goods.
Next, R+L Global Logistics can offer to fulfill all of your orders, which means utilizing our pick and pick services them from the shelves or shipping entire pallets and sending them directly to your customers. In addition to this full implementation, we are always available with industry-leading customer service to address any questions or issues you might have.
So when you’re ready to explore alternatives to selling on Amazon and need an outstanding partner to assist your operations, contact us via phone at 866-989-3082 for a free quote.
In the fast paced world of ecommerce, your business has to remain agile and at the forefront when it comes to identifying trends. On demand warehousing is one such trend that demands your attention if you plan on selling items online. If you don’t know how on demand warehousing differs from traditional warehousing or why it would be important to you, you could already be behind the curve in comparison to your competitors.
But you have nothing to fear if you read this handy guide about on demand warehousing. We’ll walk you through the nuances of the setup and let you know exactly how and why it can impact your ecommerce business in a positive way.
Don't have time to read the article and need immediate help? We've got you covered. Request a quote and our experts will reach out to you quickly.
On demand warehousing is an offering to retailers, shippers or ecommerce companies that allows those businesses to access warehouse spaces. This business model has the benefit of giving businesses seeking out warehouse space a model where they pay for only what they use, which can be very helpful in a scenario where money is at a premium to your business.
The reason on demand warehousing is gaining popularity is it is a pay-per-use model where you only pay for your share of what is provided to you. Therefore, the warehousing space you take up, the orders that are filled for you and any logistics services provided are exactly what you’re charged for — no more, no less.
This prevents you from having to deal with the costly investment of either preparing your own supply chain or even paying a flat fee for certain services, not using them over a given period or at the same frequency but being charged the same nonetheless.
Most third-party logistics (3PL) companies also like this because it allows them to fully maximize their space and staff. Businesses such as 3PLs that provide a service also look upon it fondly because it makes their customers — in this case, the ecommerce businesses — happy.
While it was just explained what it is and the general reason why it exists, let’s look at some more specific examples of when to use on demand warehousing.
The first one is for a smaller operation growing their business and just starting out or who has finally moved from a very small-scale operation to expanding. Maybe your small workspace or even home have been outgrown by the amount of product you’re moving. That is a good thing, but one that now requires space you don’t currently have. It is probably completely infeasible to expect an expanding business to invest heavily in building its own warehouse or leasing something comparable.
In the above scenario, the ecommerce business owner can use the on demand warehouse with the possibility of no long term commitment involved. You get the valuable real estate you require inside the warehouse without having to actually purchase any real estate yourself. This extends outside of just the space for your goods and can require short term or long term contracts. In some cases, you may be allowed to go month by month.
You’ll also get a distribution center of sorts in terms of being able to tap into the warehouse’s fulfillment network. In the on demand warehousing setup, you can receive a cost effective order fulfillment where you pay per order filled, not just for the privilege of having the warehouse on demand for you.
Another neat aspect of on demand warehousing for the business using it is shielding them from the risks associated with being responsible for setting up, expanding or otherwise managing a supply chain. It gives an ecommerce outfit fulfillment solutions without having to come up with the solutions themselves.
Now that you have the what and the why of on demand warehousing, it’s time to introduce you to what it would be like to have a 3PL handle this for you. First and foremost, a progressive, highly adept 3PL will be experts in on demand warehousing. They will have all the warehouse space you could ask for, and have this space located in strategically advantageous locations for you. While using this warehousing, a 3PL is also able to offer you the ability to have sudden increases in inventory storage in preparation for an expected busier time.
Plus, when using a 3PL, you’re already dealing with a company who knows on demand warehousing inside and out. Many 3PLs are also extremely well-equipped to handle order fulfillment for you, especially the pick and pack fulfillment that is commonly needed by ecommerce outfits.
3PLs already have the resources, experience and competency to do this kind of work, which is what you’re likely seeking out in the first place. While not all 3PL companies are created equal
When you’re looking for the flexibility of on demand warehousing, look no further than the knowledgeable and professional team at R+L Global Logistics. We can provide the solutions you are looking for when the old ways won’t work for your burgeoning or already established ecommerce enterprise.
With the demand of fast-paced warehousing and distribution services, R+L Global Logistics is uniquely positioned to help you adapt and thrive. We offer modern warehousing space in various locations with ample square feet to go along with stellar order fulfillment services or retail distribution.
R+L Global Logistics can not only store your goods but also fill orders on your behalf, doing so with high accuracy. In fact, the entire supply chain can be managed by us for you including accepting and processing returns through reverse logistics.
So now that you’ve gotten a crash course in on demand warehousing, give our experts at R+L Global Logistics a call at 866-989-3082. We’ll discuss how we can help your business handle its’ logistics and transportation needs and also provide you with a quick, hassle-free quote.
Want to learn how to start an eCommerce business? More than half of all American consumers prefer to shop online instead of in stores, and that number only goes up if you look at younger generations. There’s a massive opportunity for entrepreneurs and potential business owners in the online world, but it can be challenging to know how to get started. If you need help figuring out how to get from where you are now to running a profitable online store, take a look at our comprehensive guide!
To start an eCommerce business, you’ll need to start with a good plan, find a product that sells, design a user-friendly website, and use marketing strategies to advertise your store. Once things pick up, you’ll need to worry about packaging and fulfillment, customer satisfaction, and the steps to take to expand your business.
When you reach the stage of your business where you need assistance with warehousing and product fulfillment, R+L Global Logistics is here to help. Our fulfillment experts will create an individualized plan to meet your unique needs. You can reach out to our team at (866)989-3082. We’ll go over available options and answer all of your questions.
To learn more about starting an ecommerce business, use our comprehensive guide below.
The online shopping industry was worth $3.5 trillion in 2019, and has followed a trend of exponential growth for years! eCommerce is a lucrative business opportunity with the potential for high rewards, but it isn’t free to get started. As with any business, there will be upfront costs to get your business off the ground. There is good news, however! The costs of starting an online business are much lower than starting a brick-and-mortar store!
Getting started with online retail isn’t exactly free, but you can expect to pay a lot less upfront than most other business models. Here are some of the expenses you can expect when starting an eCommerce business:
Minimum total startup costs: $100.
Maximum total startup costs: $11,500.
To compare, the cost of starting a brick-and-mortar store is usually more than $100,000!
If you don’t know what you want to sell yet, you should know that there are a few things you’ll want to look out for when selecting the right product. Not just any trinket will work.
First, to narrow down a list of potential products, consider what you’re passionate about—or at least mildly interested in. It will be easier to stand behind a product if it is something you actually care about. Here are some other pointers to help you find some product ideas to sell online:
Don’t be afraid of selling a niche product. You could make lots of money by selling accessories for other products online, as long as the demand is there.
A business model describes how you intend to run your business, deliver value, and generate revenue. It is the center of your business plan. eCommerce is a business model already, but there are still ways you can make that more specific.
What will the day-to-day operations of your business look like? Will you be selling imported goods? Dropshipping? Handmaking your products? Utilizing multi-level marketing?
As you can probably tell, there are countless effective business models, but you have to find the one that matches your goals. If you intend to work alone, multi-level marketing or more traditional business models might not work well for you.
If you are setting up an online store for an existing retail location, then you would have a bricks-and-clicks model. You may also consider using your retail location for storage for your online store, or you could offer local delivery and pickup for online orders from your retail location.
Once you have a model, you need to create a business plan to execute it. Business plans are not just for entrepreneurs looking for investors. A business plan can keep you on target for completing your goals and help you to see the viability of your business before you get started. If you have multiple ideas, creating a business plan for each can help you compare options and pick the one that works best.
Creating a business plan requires a lot of research. To make a plan, you will want to consider:
Creating a thorough business plan before you get too invested in your idea is vital. You may get halfway through your plan and realize you don’t have everything quite as figured out as you thought you did. Finding the kinks in the strategy early on is key to avoiding failure in the future.
Now that you have a product, a model, and a plan, you need to find a supplier for your products. There are many ways to find suppliers, but one of the easiest ways is to reach out to a foreign supplier through sites like Alibaba. However, if the thought of importing foreign goods is too intimidating, or against your values, then you can find domestic distributors just as easily!
If you intend to use a dropshipping business model, then you will need to establish that relationship with your supplier. Not all suppliers offer dropshipping services, so make sure the company you are working with does what you need it to.
If the product you are trying to source is a brand new original idea, then you’re going to need to find a manufacturer to create your products. The best way to find a manufacturer is to search through online directories like Kompass or ThomasNet. Like with distributors, you can choose to work with a domestic or international partner.
Regardless of whether you are dropshipping, storing inventory yourself, or working with a third-party warehouse, you need to know how much inventory you have at any given time. If a product is out of stock, that needs to be reflected in your store. The last thing you want is to have to tell a customer an item is out-of-stock after they’ve already paid.
If you’re dropshipping, you need to be in constant communication with your supplier about their inventory levels. Having an automated system in place that integrates with your online store is an excellent way of keeping your website up to date on the latest stocking information. Still, that functionality isn’t going to be an option with all suppliers. If your supplier is out of something, you need to know.
Even if you plan on keeping track of your own inventory, things can get lost, overlooked, or miscounted. Keep an updated spreadsheet of your entire inventory, and make sure to recount your stock periodically to make sure you keep the most accurate count possible.
Working with a Third-Party Logistics company (3PL) for your warehousing needs is the best option if you can manage it. The responsibility of keeping track of inventory would be out of your hands, so that would free up a lot of your time. Many 3PLs also integrate their warehouse stock with your website with the help of advanced Warehouse Management Systems (WMS). Additionally, when product stock begins to get low, you can even have your 3PL communicate with your supplier on your behalf to restock before the inventory runs out.
Now, it’s time for you to think about one of the most critical aspects of your online business: your eCommerce website. Your website is like your storefront; it is your eCommerce platform that allows you to sell online. It needs to draw customers in, be aesthetically pleasing, and look professional. It should also be easy to navigate, branded, and well-organized. If your website isn’t user friendly, potential buyers might bounce before ever making a purchase.
Creating a website from scratch is easier now than ever before, with applications like Wix and WordPress. However, there is a lot that goes into making a website look good and operate well. You’ll need to design a logo, the site layout, colors, and much more. Meanwhile, you’ll also have to worry about the technical aspect of building a website, as well as security and reliability.
Make sure your product pages are uncluttered and easy to navigate. You should clearly display prices and product specs, and it’s usually a good practice to recommend other similar products on product pages to encourage more sales. In addition to that, make sure you are prepared to accept multiple different payment options, like PayPal, credit cards, or bank transfers. Remember, if you plan to sell internationally, customers from other parts of the world may prefer different payment options.
When your entire business is dependent on the success of your website, however, you might just want to consider leaving its development in the hands of the professionals.
One way to find a good web developer is to find independent online stores that you like the look of and reach out to them to ask who designed their website. If they had someone in-house create it, you may be out of luck. But if they worked with an independent developer, then you could reach out to them to inquire about making your own site. After all, you can see the work that they’ve done on the other site, and you know that they’ll deliver results.
You should probably steer clear of sites like Fiverr or other freelance sites. Always work with a developer that someone else recommends. Otherwise, you might get scammed.
It is essential to understand that your website must stay relevant and up-to-date on the latest web trends. You can’t expect to succeed with a website that looks like it’s dated from the early 2000s. Not only that, but you should always be on the lookout for ways to optimize your site to increase conversions and keep people on your site longer.
At this point, you have a website, a product, and a plan. All you need now is to attract customers to your eCommerce store. People aren’t going to seek you out, so you need to find a way to bring customers to you. However, there isn’t a perfect marketing solution that’s going to work for everyone.
Thankfully, there are countless different ways to advertise your store, like with:
You should try to keep your marketing strategy diverse. Utilize many different marketing techniques to reach the widest audience possible, and then, once you have an audience, keep them coming back with memberships, email lists, and other incentives.
One way to encourage customers to shop with you again is to offer a point system to those who sign up for a membership on your site. Customers can accumulate points for each dollar they spend with you, and then redeem those points later for discounts, free items, or other perks. You can even have a tiered point system, so you can offer better rewards to customers who accumulate points above a certain threshold.
For example, Ulta has three tiers for their rewards members: Member, Platinum, and Diamond. Members receive 1 point per dollar spent, Platinum Members receive 1.25 points per dollar spent, and Diamond Members receive 1.5 points per dollar spent. Those points can then be redeemed for steep discounts on products. Making it to Diamond Member status also comes with additional benefits for the customer, such as exclusive coupons, free shipping, and an annual gift card from the company.
Other options for retaining customers are by offering coupons, discounts, promo codes, freebies, bonuses for referring friends, and personalized emails and other marketing materials per customer account.
Once you start making sales, you need a plan to stay organized while shipping orders out as quickly as possible. You should always keep track of every order that you receive. Even if you only get an average of one order a day, it is important to get into the habit of writing everything down.
Better yet, you should look into software that could integrate with your website and keep track of orders for you, just to make sure nothing slips through the cracks. That way, you would be able to see everyone who has made an order, as well as precisely what they ordered. You can also reduce picking errors by using that as a reference when packing boxes.
In addition to the logistical challenges of managing a high volume of orders, you should also consider personalizing your boxes to make the most of them. While some companies might see a regular box, you should see the potential: six sides that you can use to personalize your customer’s experience and improve your brand recognition. Here are some ideas to make your boxes themselves more memorable for your customers:
Alternatively, if packaging and shipping orders is taking up too much of your time, there’s another convenient option: outsourcing. Making the decision to outsource any part of your business is nerve wracking, but at a certain point, it becomes difficult to do everything yourself. Order fulfillment is one of the most time-consuming aspects of running an eCommerce store, so you could end up getting a lot more accomplished if you didn’t have to worry about it.
The best option for outsourcing fulfillment work is with a 3PL. You could hire an employee to do the work for you, but in general, it’s a lot more affordable and convenient to work with a company like R+L Global Logistics.
Not only can a 3PL store your products and ship orders to customers, but they can also offer value-added services you might not have been able to offer before, like expedited shipping, or even free shipping. Plus, if you were using personalized boxes or packaging inserts before, you can continue to use them even if you switch to fulfilling orders with a 3PL.
Things could be running smoothly up until a customer decides they want to return a product. The rate of returns depends a lot on the type of product being sold and the cost of the items. Clothing and shoes are returned extremely frequently, while small, inexpensive trinkets are returned less often. And of course, anything that arrives broken will almost always be returned.
The process of managing returns is called Reverse Logistics because goods move backward through the supply chain. As an eCommerce business owner, you have to be prepared to accept these return shipments. In addition to that, you need to be able to refund unsatisfied customers or send out replacement shipments. Although you aren’t legally required to refund unsatisfied customers, not doing so will almost guarantee that customer never buys from you again.
Returns are a pain to deal with. They’re expensive, time-consuming, and could potentially cost you customers if they aren’t handled well. This is another good reason to consider outsourcing fulfillment to a 3PL, so you can hand this headache off to someone else. A good fulfillment partner can not only accept returns on your behalf, but they can also help you reclaim the value of your returned products by sending them off for repairs, repackaging them, and reselling them.
If you can manage to accept returns in a timely manner and offer a good deal to your unsatisfied customer, you may even be able to turn their negative experience into a positive one with customer service that goes above and beyond.
The goal of any business owner is to grow their business. Maybe you want to be the go-to source for a particular type of product, or maybe you want to make more money. Maybe you just want to live a modest lifestyle off your eCommerce sales. No matter how you want to grow, or why, you should know that managing your store is a task that is going to become too much to handle.
It can be tempting to try to control everything in your business. It’s hard to trust others, and you can’t be sure that everyone who works for you is going to care as much as you do about the company. However, if you want to let your company grow, you can’t maintain a stranglehold on every aspect of it. You need to be able to let go of some control and hand the day-to-day responsibilities off to others so that you can focus on growth.
Fulfillment is the first step of many that you can take to free up your time, and it’s an easy choice. By working with R+L Global Logistics, you know that you’ll be working with a professional company with a good reputation, so you won’t have to worry about putting your business in the wrong hands. We’ll care about your business, and we’ll treat your customers as if they are our own.
By outsourcing your fulfillment with a 3PL, you’ll be able to maintain complete control over the process without having to waste your time on busy-work. Plus, it’ll be a good exercise in passing on responsibility to others, so you’ll be more prepared to hand over aspects of your business to employees when the time comes.
R+L Global Logistics offers a range of fulfillment and distribution services. No matter what your business requires, we have solutions that can fit your needs. If you need to store 10 pallets, 100 pallets, or even more than that, we can offer warehouse space around the country. We work with countless vetted partners to be able to provide you with refrigerated warehousing, expiring product fulfillment, and much more!
To better serve our eCommerce partners, we offer services like Pick and Pack fulfillment to make the order fulfillment process more personalized and efficient. We carefully pack one box with all the items a customer orders, along with any packaging inserts you may want to include, and ship them off to the customer on your behalf. By using a single box, no matter how many items a customer buys, you can reduce packaging and shipping costs and make the experience more convenient for your customers.
We can also offer specialized Kitting and Assembly services that allow you to sell multiple different items together as a bundle, often at a slight discount. This can help you upsell to your customers by bundling items that are commonly purchased together. If you sell bathroom products, you could bundle all your products with similar scents together, such as lavender hand soap, lotion, and face scrubs. Or, if you sell bags, you could bundle together bags with the same pattern to make a luggage kit for people who travel frequently.
In addition to those services, we also offer:
If you’re just getting the hang of how to start an eCommerce business, we can help you set up your fulfillment and distribution at an affordable price. Give us a call at (866) 989-3082 to get started today, or fill out our quote form to request a fulfillment quote online!
A third-party logistics (3PL) company can be an important part to any business, especially those in the ecommerce space. But being fully knowledgeable about 3PL ecommerce fulfillment can be quite a chore if you’re not very experienced in that field. There are many different parts of the supply chain, each of which must work together seamlessly to provide your ecommerce operation the best result.
Thankfully, it’s not terribly complicated. Learning things about 3PL ecommerce fulfillment such as warehousing, pick and pack fulfillment, cross dock loading and reverse logistics will give you a leg up over the competition. These terms and more will be explained clearly throughout this article, acting as a complete guide for newcomers.
Many ecommerce operations are not huge companies where they can do each job in the line of the supply chain themselves. In fact, like any important job, there are 3PL companies that specialize in helping with ecommerce fulfillment. But what exactly is that?
3PL ecommerce fulfillment is when an ecommerce business employs the services of a 3PL to carry out certain tasks on its behalf. This can be as small as one or two parts of the supply chain or running the entire supply chain once the goods in question leave the hands of the manufacturer or wholesaler.
These tasks include but are not limited to:
Each of these services can be very important to an ecommerce business and each will be explained in further detail as the article proceeds. There are many reasons why an ecommerce outfit would choose to work with a 3PL and they are all related to making your business operate more efficiently, more cheaply or both.
For instance, a 3PL is supposed to be an expert on all matters of the supply chain since that is the main reason their own business exists. In that vein, you should look for a company that doesn’t make mistakes when filling orders, that is professional and courteous when dealing with you or your employees, is sound financially and has access to resources — whether it be technology or equipment — that make the entire process easier.
On top of being professional and courteous, the 3PL that you entrust with your valuable business assets should have the ability to help with nearly anything that would come up during normal order fulfillment. That includes processing returns or even seemingly simple things like quickly processing and responding to electronic invoicing.
In short, the better your 3PL is overall, the easier it will be to concentrate on making money from your ecommerce enterprise.
This is the very first step you’ll run into during the process of ecommerce fulfillment. Warehousing is one of the more simple concepts to grasp since it is self-explanatory.
Even if you didn’t have a 3PL fulfilling every one of your orders, if your operations are big enough, you’ll likely end up seeking out warehousing space. Whether you build your own warehouse, lease an entire warehouse or reach an agreement with a 3PL to rent out a certain amount of space in one of their facilities, you can easily see that all of your goods need to be stored somewhere.
If you choose to store your products in a 3pl warehouse, you have a few options for what is done with them once the time comes for them to be on the move again.
For the purposes of their article, the first option is the most likely in this case. So in order for a 3PL to successfully do this on your behalf, what would they need? Most sterling warehouse setups share a few key ingredients:
Speaking a little more about strategic locations, many 3PL companies have secured places in or around major shipping hubs from New York City to Los Angeles and many points in between. If the 3PL doesn’t have warehousing in multiple, well thought out spots, they may not be of much use to you.
While there may be some smaller characteristics you’re looking for, the above aspects are each important and — when combined — can be a great 3PL to partner with since they can offer you crucial components in helping your ecommerce fulfillment business succeed.
Think of kitting as a bundling of products. This is when multiple products with different Stock Keeping Units (known as SKUs) are combined into one SKU that is then sold to consumers. The kind of items that likely examples of this occurring would be things like subscription boxes, custom-ordered items or gift baskets.
Kitting is a kind of order fulfillment that is a pre-created package sent out to customers, not individual items put into a package via pick and pack order fulfillment. The reason an ecommerce business would want to use kitting for fulfillment is to cut down on the added financial obligation that comes from sending a bunch of single products to many customers or even in different orders to the same address.
Let’s use the example of a metal spatula used for grilling food outdoors. On the lower end, this might be a $10 item for a consumer. But what if the ecommerce business noticed that customers who bought the spatula would also eventually purchase a grill cleaning brush, grill tongs and skewers. So they sell those 4 items together for a total price of $30.
So you can sell a grilling tools bundle with individual tools priced attractively for shoppers. While they get a discount on a set, you will also get a break on being able to send out 3 or 4 items at once instead of shipping them out one at a time. Not only will you save on shipping, but the cost associated with 3 or 4 items having to be picked off warehouse shelves separately. Kitting can also be used in ecommerce fulfillment to help move inventory that is not selling as well.
Using another example, we can look at hand soap this time. Let’s say your apple and peach scented soaps are flying off shelves while you’re having a much harder time with your coconut and lemon scented soaps. These usually sell for $6 each but you put one of each into a bundle for $20 total. This lets you offload the less popular coconut and lemon soaps by using the more popular apple and peach with a lower overall price. And again, instead of shipping soap to four different addresses, you can clear out 4 bottles of soap to one address for a much lower price.
A standard definition of order fulfillment is the entire process from receiving an order to making sure the customer receives the order. In ecommerce order fulfillment, the specific way the customer receives its goods is when a 3PL is given the order by the business it is contracted to provide services for.
What the 3PL will do is pull the items off the shelves or a pallet in its warehouse, package it if it isn’t a kitted item and either send it via mail or a shipping service like UPS or FedEx, or load it onto one of its own trucks as freight and ship it along with other items heading to the same destination.
In this kind of order fulfillment, the business (i.e. you in this case) only has to have the product in stock in the 3PL’s warehouse and provide directions such as where to ship items or how to accept returns — which is part of reverse logistics, explained later in this article.
Another kind of order fulfillment that exists in the context of using a 3PL is called expiring order fulfillment. This is used for items that have a limited shelf life such as food or medicine. What the 3PL will do on your behalf is package the item with the shortest expiration date. The reasoning behind this is so that there is not product waste that you’ll have to eat the cost on. The customer still gets a fresh or viable product as well, so it is a true win-win.
In pick and pack ecommerce fulfillment, cross docking won’t come up very often. But it’s not a bad thing to know about in case of one specific situation that can occur sometimes in the business world.
First off, cross docking is where your products will pass through a warehouse or distribution center by being offloaded of one inbound truck and loaded onto another truck in an outbound dock. The outbound truck then goes directly to a retailer or the customer. It is handled minimally with little to no storage.
In ecommerce fulfillment, you won’t need cross docking day to day. Where it can come into play is if you receive a large order from a customer that needs to be in the same shipment, like a pallet or more worth of merchandise. Instead of trying to pack those shipment into individual boxes and mail them to the customer, it could be much easier and more cost efficient to simply have the 3PL company include it on a truck already bound for the customer’s general area and have it drop shipped there. Utilizing cross docking services certainly has a host of benefits in terms of efficiency and cost that should be strongly considered.
Let’s face it: any business that sells goods must prepare for the inevitability of consumers needing to return items. And you might think that because you’re allowing a 3PL company to handle the shipping, you have no way to implement this. But any forward-thinking 3PL provider has already thought about this and has a system in place to provide this service.
Reverse logistics in the most simplest sense is about product returns. In a more complicated aspect though, it is also about how these returned products are repurposed once they make their way back. There are two things that can be done with items that are returned: the products must be disposed of if they are unusable or they can have their value recaptured, either by being reconditioned/repaired for sale or stripped of usable components to use in the manufacturing of new products.
That is a specific view of what reverse logistics is, but widening the scope one more time, the term refers to anything in which a good has to come back to the manufacturer or business after having already reached its final destination, whether that be a customer’s home or a brick-and-mortar store. In 2020, the estimated financial impact to all U.S. businesses is $550 billion when it comes to returned deliveries. Also, about 20 percent of all e-commerce purchases get returned, compared to just 10 percent of items from retail stores.
This shows reverse logistics to be an important area where streamlined efficiencies are crucial to not letting returns overwhelm your operations or negatively impact your bottom line. The recovery portion of reverse logistics is especially important to businesses since it serves two important purposes — it helps the company still profit off products that weren’t perfect in the first place and it can also reduce the environmental impact of just telling customers to throw a bad item out and sending them a new one.
When analyzing whether a 3PL would be too high cost to use — especially if you’re just starting out selling via an ecommerce platform — it can be tempting to automatically think it will be. However, for many reasons, utilizing a 3PL for your ecommerce fulfillment can actually save your business money in a variety of ways.
First off is a much cheaper initial investment. A 3PL has warehousing space, a warehouse management system (WMS) and warehouse equipment to move items around quickly and effectively. For an ecommerce business to get set up with all that stuff would be a sizable upfront investment of both time and resources. Or you can go with a 3PL who already has everything needed.
Furthering the point of initial investment is you don’t have to staff part of a warehouse to process orders. That’s no small point, since many businesses’ biggest cost is labor. Also, you pay a 3PL based on the volume of orders it processes for you; this means the cost can vary in your favor instead of having fixed costs no matter how many of your items are handled.
Another area to consider is the ability to get your products closer to your customers before they ever order it. By partnering with a 3PL, you should have access to their network of warehouses. This will allow you to have your products strategically placed to cut down on shipping time — making your items more attractive to prospective buyers — and also shipping costs, since the items don’t have to travel as far.
Also during busier holiday seasons, where some types of ecommerce businesses can see huge jumps in order volume, a skilled 3PL is ready to take this on for you. But would you be ready to have to hire more staff or the increased costs while ramping up?
Now that you’ve read the complete guide to 3PL ecommerce fulfillment, you know how important it is to have an outstanding company to team up with. In that vein, let R+L Global Logistics be the partner that can fulfill all of your supply chain needs, which includes order fulfillment.
With our strategically placed warehouses all over the U.S., storing your products in convenient places is no problem for us. Then, depending on your needs, we can freight ship them to brick-and-mortar retailers or undergo order fulfillment on your behalf to meet whatever your business goals may be. Order fulfillment, with our years of knowledge and streamlined processes couldn’t be easier.
But R+L Global Logistics doesn’t just do order fulfillment. We excel in all areas of the supply chain, which includes:
So when you need the best in 3PL ecommerce fulfillment, give R+L Global Logistics a call today at 866-989-3082 to receive a free quote and see exactly how we can help out.