DROPSHIPING

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DROPSHIPING THE OTHER ONLINE BUSINESS

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DIRECT MAIL

This method of marketing can easily be adapted to a "home business" environment. In fact, virtually every aspect can be handled out of your own home, from stuffing letters to stamping envelopes.

HOW TO IMPLEMENT DIRECT MAIL MARKETING

1) Determine suitability of your product- First, you need to figure out if what you have to offer is appropriate for direct marketing. Items under $100 generate the greatest volume, but major appliances may also be sold. Because of the nature of direct marketing, you ought to purchase your items before offering them. However, this puts you in charge of mailing products to your clients. Unless you love expensive shipping costs, a large item like a dishwasher may not be the greatest idea.

In addition, the products you are promoting should be suitable for a mark-up of at least three times your total cost. This will cover all of your operating costs, which should be about $1.35 per letter, and still leave room for a profit. The mark-up shouldn't be a problem, due to the low, low prices you have access to. Also, a good direct marketing campaign will elicit about a 2% reader response; you must send out a large mailing to make it cost effective.

  • 2) Discover your target market-Focus your effort on
    particular consumer group. You will have a narrow
    range of merchandise to offer, so first perform
    market research to find where the greatest interest
    for your product lies. A possible target market could
    be the entire medical profession, or just nurses.
    Other potential markets include law enforcement,
    teachers, sports enthusiasts, boat owners, etc.
  • 3) Catch peak selling seasons-The best time to offer
    merchandise is the three-month period right before
    Christmas, and just prior to Mother's Day, Father's
    Day graduation, and June weddings. In addition,
    take advantage of seasonal interests, such as
    sporting goods, hot/cold weather products, etc.,
    coordinating your mailings with peak seasons
    requires advanced planning and organization, so
    begin early.
  • 4) Design your campaign and ad copy-While creating
    your ad copy, keep in mind the following:

i. Professional services may be costly, but the quality of your copy will make it worth the price. One word advice: freelance writers are often just as good, yet less expensive, than an ad agency.

ii. You can either do a mass mailing of "junk mail" quality, or smaller mailing of personalized, high-quality letters addressed to specific individuals. The former is less expensive, but

also less effective per letter mailed. It's your choice.

iii. If you include a letter circular, and an order form, it will increase your sales four times. While designing, concentrate on your letter most of all, it will account for approximately 60-65% of your sales. The circular will account for about 10-15%.

iv. The average business person, when reading a letter from someone he or she doesn't know, will read the opening paragraph, glance at the middle, and then go to the last paragraph. Put a "hook" or attention-getter in the last paragraph.

  • 5) Give your clients a reason to act NOW- One good
    way to do this is to offer free product(s). Be sure to
    communicate that you have something unique to
    offer. Name-brand merchandise at incredible prices
    should do the trick. Another good tactic is to present
    various offerings, such as discounts for cash
    payments or for large quantities, free merchandise,
    financing, or free trial period with a money-back
    guarantee.
  • 6) Use a central theme - It helps to have one general
    idea to tie the whole campaign together. For
    instance, if you advertising waffle makers for
    Mother's Day, keep that theme recurrent throughout
    your letters, circulars, and envelopes. Use graphics,
    words, and expressions that would remind the reader
    of Mother's Day and the importance of providing
    your mom with a great gift.
  • 7) Don't forget follow-up calls! This is a truly important
    part of your campaign, especially if you opted for the
    smaller, personalized mailing. Make your follow-up
    calls during mid week, avoiding Monday and Friday,
    since these are usually the busiest days at the office.
   

INTERNET MARKETING

INTERNET MARKETING

A great place to market merchandise is on an e-commerce website. Since most of the suppliers in our system have websites listing many of their products, it will be as simple as using the copy and paste feature on your computer. Since the Internet exposes your product to people all over the world your market base on the web is limited only by your marketing skills. The Internet is a highly competitive marketplace. Knowing what other companies are selling your product for is essential to your success. The Internet does make product research very simple. To explore the market for your particular product just visit the search engine or directory of your choice. Type in the applicable key words that pertain to your product then visit the sites that come up from the Internet search. By doing this you will find out what the competition are selling the product for and what their terms are. By learning this, you can determine if the price you are paying for the product will enable you to meet or beat the competition's price and still make a profit. If you can sell at or below the competition, then by all means put the product on your website. It will produce sales for you.

Dropshiping

DROPSHIPIN & DISTRIBUTION

Selecting a product to sell is one of the most important steps to successful retail. No matter the experience level this can be one of the most confusing and sometimes frustrating steps. In the following pages you will find the in depth information you need to get started in one of the most important areas of online distribution, drop shipping.

In distribution there are 3 tiers you will want to be familiar with before starting to find your own product(s)

.1) Most shoppers are familiar with the first tier - retailing.
Retailing is when the manufacturer sells merchandise
directly to department stores, franchises, store chains,
shopping malls or any other retail outlet.

2) May bargain shoppers are also aware of the second tier
-wholesaling. Wholesaling takes place when the
manufacturer sells in bulk quantity to discount stores
and other wholesale outlets. Cosco or Sam's Club are
good examples of stores who sell wholesale bulk items.

3) Our third tier, drop shipping, is generally the most
foreign of all the tiers. Drop shipping is a multi-billion-
dollar-a-year product distribution business in which
manufacturers and wholesalers will ship or "drop ship"
their product to your customer directly.

Companies that offer drop shipping will generally sell their products to you at or below wholesale prices. You, as a buyer or registered dropshipee, may then resell these items at marked-up prices to consumers, wholesale outlets, or even retail stores. Drop shipping gives manufacturers the opportunity to quietly distribute inventory without the overhead publicity tends to incur. You are able to have accesses to thousands of different products through one or more drop shipper without the worry of storage or inability to sell the items.

  

The business opportunities are astounding. Hundreds of manufacturers are seeking buyers for literally thousands of items that are worth millions of dollars. That's a lot of big numbers. But, most importantly, the value your clients will see in these items can lead you, as a distributor, to great financial success. And, the opportunities are expected to only get better!

POTENTIAL MARKETS -What's Out There?

You can sell your products to more people than you think. You may sell to small retail companies that don't normally carry the manufacturer's products, or to any contacts not specifically prohibited by the manufacturing company. You're left with a wide array of potential clients.

Unlike retailers and wholesalers, who have to mainly stick to their stores, you have a whole range of creative selling possibilities out there. Knowing where to find them, however, takes a little ingenuity. This section shows you where some potential markets are hiding. It's up to your imagination, however, to uncover the rest.

Even though most manufacturers experience times when they want to move merchandise as quickly as possible, they would rather not see their products nationally advertised as "liquidated merchandise." It looks bad for the company and may detract from a company's more profitable channels of retailing and wholesaling. For instance in the pricier new lines the manufacturer is currently promoting. Moreover, retailers paying more than the "nationally advertised" liquidation prices would get very upset with manufacturers if they saw the lower prices, and perhaps stop doing business with them.

TYPES- What's out there and how do I find them?

Manufacturers drop ship just about every product imaginable - from bread makers, clocks, televisions, and basketballs to computers, fax machines, baby grand pianos, and furniture. Oftentimes you can get the same merchandise that the retail stores are currently selling, but at a much-reduced price.

Earlier we briefly covered the 3 tiers of distribution: retail, wholesale, and drop shipping. As a merchant you have the opportunity to use all three of these channels as the means of a drop shipper.

Typically when a person hears the word drop shipper the first thing they think of is the third tier. The third tier 'drop shippers' focus primarily on just that, drop shipping. They have no retail shop nor do they care to have one. Focusing on warehousing items and shipping them out for their dropshipee cliental base is top priority. Third tier is a great place for a beginner to start. Establishing a relationship with a straight drop shipping company is usually a fairly easy process and requires very little to start up.

While starting up with a drop shipping company is one of the easiest routes to take, it isn't the only one. While they may not call themselves 'drop shippers' the other two tiers of distribution may also be used for drop shipping. Any type of retailer, large or small may be considered a drop shipper if you can work out an arrangement like mentioned above. Most large retailers don't have time to do drop shipping for you but often time smaller retailers will take business in any form they can get it, including drop shipping.


PREMIUM INCENTIVES

The premium incentive industry exchanges over $29 billion a year with increases every year. This industry promotes the purchase of products and services by businesses to be used as awards or "gifts." The businesses can then use these items to an employee incentive program or as free gifts to stimulate retail purchases.

 

  • 1) Most shoppers are familiar with the first tier - retailing.
    Retailing is when the manufacturer sells merchandise
    directly to department stores, franchises, store chains,
    shopping malls or any other retail outlet.
  • 2) May bargain shoppers are also aware of the second tier
    -wholesaling. Wholesaling takes place when the
    manufacturer sells in bulk quantity to discount stores
    and other wholesale outlets. Cosco or Sam's Club are
    good examples of stores who sell wholesale bulk items.
  • 3) Our third tier, drop shipping, is generally the most
    foreign of all the tiers. Drop shipping is a multi-billion-
    dollar-a-year product distribution business in which
    manufacturers and wholesalers will ship or "drop ship"
    their product to your customer directly.

Companies that offer drop shipping will generally sell their products to you at or below wholesale prices. You, as a buyer or registered dropshipee, may then resell these items at marked-up prices to consumers, wholesale outlets, or even retail stores. Drop shipping gives manufacturers the opportunity to quietly distribute inventory without the overhead publicity tends to incur. You are able to have accesses to thousands of different products through one or more drop shipper without the worry of storage or inability to sell the items.

Midwest Printing & Publishing                                                               Established Milwaukee WI                                                                                   2007

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