3 Things to Consider to Better Manage Drop Shippers
More retailers are using drop shippers than ever before to offer more products to customers than they could otherwise. On top of a deeper product selection, drop shipping also gives merchants a greater array of fulfillment options, allowing them to get orders to customers more quickly and at a lower cost.
However, successful use of drop shippers does not come easily, and this is something many retailers are finding out firsthand. While these retail partners can bring a lot of benefit to the table, merchants need to be diligent when selecting who they work with and how they implement drop shippers. Critical oversights can lead to greater costs, unhappy customers, longer turnaround times and an angry drop shipping partner. Here are a few things merchants need to consider as they look to better utilize their drop shipping partners:
1. More is not always better
Being able to offer customers literally anything they want always seems like a great idea on paper, and that is why many merchants utilize drop shipping. But more is not always better. In fact, it can often be worse. As customers browse a retail site, it is best to focus their attention on a specific selection of quality goods – this way, they don’t get inundated with items they don’t want. Offering too many items results in customers having to find the metaphorical needle in the haystack, which is problematic for customers. Retailers still need to make item selection and curation a priority when utilizing drop shippers – they’ll just have more options.
“As a rule, a category dominated by distributors requires much more effort to have a truly unique product assortment,” suggested PracticalEcommerce contributor Jeremy Hanks. “Carefully select your supplier partners in a smart category, and then curate and limit their products as you assemble your product selection.”
2. Promote transparency
Many retailers work hard to build up a sense of trust with their customers, but that trust can easily be shaken if merchants are not forthcoming about their use of drop shippers to fulfill orders. As Shipwire noted, it is quite obvious when retailers use a third-party vendor to fulfill purchases – orders may ship with goods packaged separately, items could arrive at different times and the packaging itself is likely to be different. If customers know before the purchase is made that an item is coming from a drop shipper, their expectations will be set appropriately.
Merchants may not think to disclose the use of drop shippers, or they may not want to concern customers with the fact that the item is coming from another brand. At the end of the day, though, transparency is the best course of action and many customers are already becoming more accepting of the drop shipping model. Transparency will make things much easier down the line, especially if issues arise – it can save a lot of frustrations if expectations are set from the start.
3. Figure out the logistics
As retailers consider their various options, it is important they don’t get swept away by inventory selection and forget about other factors such as the logistics.
For example, retailers may want to consider selecting a retail partner that offers similar turnaround times and shipping options so there aren’t any radical discrepancies when a customer buys an item from a drop shipper. This promotes a consistent shopping experience and ensures customers don’t feel punished for making a purchase from a drop shipper.
Retailers can make a lot of headroom in this regard by making logistics a central part of negotiations before contracts are signed. The key is finding a solution that works for all parties involved – a happy business relationship is a productive one.
“Retailers and suppliers should agree on which carriers and methods will be supported, average time to ship, shipping restrictions and handling fees,” Hanks added. “The retailers and suppliers that have the most success around drop-shipping logistics make these details a cornerstone of their partnership.”
Drop shipping is growing more common as retailers look to better serve their customers. However, careful selection of drop shipping partners is pivotal to ensuring successful integration of these vendors. Merchants should consider product selection, transparency and logistics as they look to pare down their list of prospective drop shippers.