Drop-shipping is defined as a “supply chain management technique in which the retailer does not keep goods in stock, but instead transfers customer orders and shipment details to either the manufacture or a wholesaler, who then ships the goods directly to the customer”. In recent years, the drop-shipping business has increased in popularity particularly due to the spread of the Internet. It is now easier for manufacturers or wholesalers to communicate with retailers and vice-versa.
Whilst more people consider becoming drop-shippers, many are afraid of fallen victim to fake wholesalers, and rightly so. Unfortunately, like other thriving businesses, drop-shipping is also targeted by scammers who pretend either to be genuine wholesalers. However, the good news is that with careful observation one can actually spot the pretenders.
Spot the difference!
A fake wholesaler will usually ask for money at the first opportunity. When this happens, you should immediately know that he is more likely to be a middleman or scammer because genuine wholesalers should not ask for money to promote their own business. Furthermore, many scammers use bogus Websites to lure unsuspecting drop-shippers to so-called “work from home business opportunities” with service charges that leave little or no profit margins for their victims.
There are however some benefits to be enjoyed from drop-shipping, as in affiliate marketing, if the right manufacturer or wholesaler is chosen with care. A future article will discuss some of the major benefits of becoming a drop-shipper.
Share your drop-shipping experiences and suggestions with our readers.