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Not all suppliers are the same, some are excellent, or good while others are
mediocre or worse. This is the reality that face all new dropshipping
companies and you need to know right from the start what to look for in
suppliers, how to handle suppliers and what you need to avoid.
Be Legal Before You Contact Suppliers
You need to set your business up correctly in all legal aspects and have all your
paperwork in place when you start sourcing and contacting potential suppliers
and wholesalers. This is essential as suppliers will ask for proof of your legality
before they will consider doing business with you. It is okay to start asking basic
questions, suppliers are used to entrepreneurs looking for information and will
give you answers without demanding proof that you are a legal company.
Suppliers and wholesalers will not do business with companies they have not
approved, and for that approval to be granted, you need to be legally
incorporated and have complied with all state laws. Sadly, the wholesalers have
learned the hard way that too many people try to scam them. So, make sure all
your paperwork is in order and you will start out by building up good
relationships with your suppliers.
Successful Online Search for Suppliers
Suppliers and wholesalers are known to be quirky and very individualistic and to
find the ones you really want to do business with will take some innovative
searching. It is not the case that suppliers are trying to hide away from
entrepreneurs, they simply march to their own drummers. You therefore need to
do some serious searches and use the following guidelines to achieve the best
results.
In-Depth SearchesSuppliers do not consider marketing to be a top priority for their products. You
will have to patiently dig through a large number of search results to find the
information you need. Most often the official website of the supplier will only be
found for example on Page 6 or Page 10 of the search results when searching for
a specific product. Persevere and you will reap the benefits.
Modify Your Search Criteria
You must modify your searches, it is not enough to just search for supplier X or
product Y. Your search results will be mediocre at best. Make lists of synonyms
for example for wholesaler and supplier and do a search on each of the
synonyms. Use alternative wording and different search phrases to get the best
search results.
Functional, Not Appealing
Usually when you land on a website you look for things that you find appealing,
items that catch your eye immediately and websites hold your attention with
snappy web content and high quality photos.
Wholesalers and suppliers have websites that are minimalistic and functional and
often look quite old fashioned and antiquated, especially to young entrepreneurs
. They are fully aware that clients need them and will look for them so they do
not waste their valuable time and resources in creating websites to entice
potential clients. Learn to look past the outward appearance of their websites, it
is not an indication of a bad supplier or mediocre products on offer.
Convenience of Paid Supplier Directories
Making use of supplier directories is a topic heavily debated as some people feel
that it is an extravagance and something you won’t be using again once you have
settled upon your suppliers. There is no right or wrong answer, it is a personal
choice each entrepreneur makes.
These databases are extremely convenient to have on hand as they are organized
and categorized so you have all the suppliers together for specific products andregularly updated. Most of the top organizations that offer paid supplier
directories also screen the companies before they enter them into the directories
to ensure that all their listings are legitimately operating suppliers and
wholesalers.
Another benefit of using paid directories is that you have access to a large
number of alternative suppliers for your niche products should you have an
emergency and need to switch suppliers quickly.
Supplier directories are not an essential necessity for your business but a reliable
and convenient tool to have when you need it or when you want to start scaling
your business.
A Trick of the Trade to Keep Handy
When you are really in a bind, you can use the well known trick of placing a
very small order with one of your competitors in the dropshipping businesses.
This can really help you if you if you need to find a supplier but have been
unsuccessful.
Once you have received your order from your competitor, it is quick and easy to
do an internet search of the return address on your package and it will give you
the info of who originally shipped the package to you.
Build Credibility with Suppliers
Credibility is a vital currency in the ever-changing world of e-commerce that
you must have to make a success of your dropshipping business. To understand
how important this is, you have to put yourself in the shoes of suppliers and
wholesalers. They constantly have to deal with eager entrepreneurs who may or
may never become their client. They do not have the time or inclination to deal
with persons who are not even sure of what they want and often try to use the
supplier as a free sounding board to answer questions and give free advice.
Be decisive and professional when approaching a supplier. Do not be vague
about your business goals and do not start demanding terms and discounts when
you have not even started placing orders with them.
Credibility cannot be demanded, it has to be earned through interaction with the
supplier over a period of time. Should you be overbearing and demanding when
you are just starting out with a supplier you will be labeled as an annoying upstart to be avoided whenever possible and you will not be able to shake off
that negative reputation easily.
Get Personal, Pick Up the Phone
We live in a world of instant communication via email, chat programs and social
media without ever having personal contact with people. When you are sourcing
a new supplier, change your mindset and make personal contact by picking up
the phone. Speak to them, hear their voice, and you will find people are far more
approachable than keeping it impersonal words on a screen.
Suppliers are used to answering questions from customers and will
accommodate you, and this will help to build a good rapport between you and
the supplier. If this is a new supplier and you feel nervous approaching him for
the first time, makes notes of questions you need answers to.
Place Test Orders
When you want to place orders with a new supplier, it is good business sense to
not jump in blindly, for even if you had done in-depth research and feel
confident in the ability of the supplier to complete order fulfillment successfully,
you need to test the waters.
Place small orders for the first few orders so that you can observe how this
specific supplier or wholesaler operates his business. This will enable you to
observe how smooth the ordering process is handled by the company and the
time taken to ship orders to your customers. Take note of how quickly the
supplier issues tracking data and how efficient the company billing department is
in issuing an invoice to you.
You can get feedback from your customers regarding the packaging used and
gauge their satisfaction with packaging, shipping and delivery.
Attributes to Look for in Suppliers
When you select your suppliers you need to be sure that they are reputable and
reliable. You cannot entrust the success of your business to a supplier who is
careless or has a reputation for being late with shipments. Suppliers play a vital
part in any dropshipping business and you must know the supplier is dependable.
So, when you must decide if a specific supplier will perform his role successfully, use the criteria below as your yardstick. What you should aim for is
that your intended supplier has most of the needed attributes, if not all.
Well Trained and Informed Members of Staff
Competent suppliers that have experienced staff who are able to professionally
answer questions about the products they sell. If the sales staff cannot fully
answer questions about the industry they represent or the different products they
market, it reflects badly on whether the supplier operates a well-run company.
You need a supplier you can rely on, especially when you are a new business or
when you start scaling into a new niche you do not have detailed knowledge of.
Up-To-Date Technology
All the forms of e-commerce rely heavily on modern technology. Make sure that
the prospective supplier has kept up with the technology needed to make the
process from ordering through shipping to delivery run smoothly.
The supplier’s website does not need to be fancy; instead, it has to be super
functional, so check whether he has invested in the following necessities for
online trading.
● All-inclusive online catalog.
● Data feeds that can be customized to suit the specific needs of
clients.
● Accessible real-time inventory.
Location, If Using Suppliers Inside the Country
When you make use of supplies that are local, you need to look at exactly where
the supplier is located. The more central the supplier’s location it, the more
beneficial it is for your business. It is well-known that local shipping very often
takes longer than shipping into the country from overseas. If your supplier is
central, it cuts down significantly on shipping time. Less shipping time often
means lower shipping fees and happier clients.
Preferred Method of Placing Orders
Find out the various ways that the supplier accepts orders. You do not want to be restricted to placing all your orders telephonically. This is not very convenient as
you are restricted to business hours only.
Should you be limited to only placing orders manually through the supplier’s
website, the ordering process is slow and takes a lot of time. You need the third
option of placing orders via email to free up more time that you can spend
productively doing other tasks.
Dedicated Support Staff to Deal with You
If you have to deal with a different support staff member each time you have to
call the supplier, it becomes very frustrating. You have to repeat yourself over
and over as the staff you deal with has no knowledge of the reason you called
before. This is hugely problematic when you need to resolve any problems and
time-consuming. A competent supplier will allocate a specific support member
of staff who deals with your orders and queries.
Suppliers and Wholesalers to Avoid
There are several revealing indicators to warn you to steer clear of a specific
supplier or wholesaler. Rather look for another supplier who operates his
business ethically and without does not pressure clients with dishonest schemes.
Be vigilant and avoid getting involved with suppliers as soon as you pick up any
of these signs.
Negative Reviews
Check the supplier’s website for negative feedback given by previous clients and
check social media to see how many complaints clients have had. Consumer
complaints websites give you a good idea of the reviews and feedback
concerning a supplier.
Bulk Quantity Products
Companies that specialize in the sale of very cheap bulk products does not
inspire confidence as a preferred supplier for your dropshipping business.Demanding Ongoing Fees to Be Able to Do Business
with Them
Suppliers who demand ongoing fees from you for the “privilege” of doing
business with them are to be avoided at all costs. This is a form of coercion that
you should not fall prey to.
Abnormally High Pre-Order Fees
Pre-order fees are a part of life for all dropshipping businesses and these fees
fluctuate according to the type of order you place regarding the size of the order,
whether it is a bulk order or a very complex order. What is not normal is a
supplier that charges pre-order fees that are far higher than the norm; this is not
an ethical business practice.
Non-Negotiable Minimum Size Policy
If a supplier is not willing to be flexible regarding his minimum size order
policy, this company is not suitable for your dropshipping business. Many
suppliers are prepared to charge you the minimum size fee upfront and then
fulfill your order quantities over time as your customers place orders with you.
Make sure about what you can expect before you start using a supplier.