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Drop Shipping For Retail ROI

May 1, 2012

E-retail companies and mom and pop shops that want to make more money without the potential of overstock headaches need not look further than drop shipping. Drop ship programs let retailers quickly fulfill customer orders, whether online or in-store, without having to house the inventory. Some wholesalers offer the service for an extra slice of the sales pie, but many wave all fees to benefit retailers.

"I don't charge anything extra for drop shipping, because I want to be there for my retail clients," says Mark Ehrmann, founder of Mark Ehrmann Jewelry. Drop ship orders, Ehrmann notes, take roughly the same amount of time as regular wholesale orders to package and fulfill, about a half-hour. "So why charge more?" he asks, and adds, "The return packaging will have the retailer's name and address on it, not mine. I want to be the invisible part of the fulfillment process, so my customer gets all the credit for the delivery."

His "The Wrap" non-piercing earring products, handcrafted one piece at a time, have been a hit with women since the 1980s, and are available at www.MarkEhrmann.com. "Consumers appreciate the hand-finished look," the designer and executive said. "It differentiates our product line from a lot of other items available on the market." Ehrmann says his company prices its products to give retailers the ability to achieve an enviable return on investment. Retailers normally price his items at either 2.3 or 2.4 times the wholesale price, and they do not have to keep the product in stock, with Ehrmann's drop shipping. "Some of my clients in higher rent locales price my stuff at three times," he says. "They keep selling out and coming back for more."

Sal Maggio is a wholesale veteran who understands the need for servicing retailers with the best drop shipping tools. He is the CEO of Salco Distributors, which operates leading websites EZWholesaler.com and EZDropShipper.com. The latter not only offers great products at fantastic prices, but also a custom data feed system that is top notch. It allows retailers auto-populate their websites with Salco's latest items.

Maggio recently broke down how EZDropshipper.com's data feeds work. "While many drop shippers offer data feeds, we have a system that allows you to create a feed based on what you want, 24/7," he says. "If you need help or additional service, we have a database programmer on staff, so whatever is needed can be accomplished. There are feed providers out there who charge $30 plus per month just to manage one feed. But here you are getting what amounts to several feeds, and it's included in our $29.95 membership fee."

Salco's 19 years of business has created strong bonds with manufacturers everywhere. Maggio said these ties let his firm leverage the marketplace to create the best prices for retailers. "These relationships and agreements allow us to mirror the pricing of the manufacturer, despite the fact that we are selling only one piece and not a pallet," Maggio said. "Most drop shippers work on a cost-plus basis. We actually receive discounts based on our marketing and sales efforts that allow us to provide this manufacture-direct pricing to our members. We use our membership purchasing power to assist in these negotiations."

EZDropShipper.com and EZWholesaler.com offer more than 2,500 items, from hot brands like Canon, Miracle of Aloe, Shark, Contour, and more. Product categories include "As Seen on TV," Jokari, Collectibles, Health and Beauty, Home Medical Equipment, Housewares, Made in USA, and Security & Defense. Salco recently brought on an Electronics category, which offers a big selection of Lenovo laptops and accessories.

"Our ?As Seen on TV' products have always been excellent sellers," Maggio points out. "They are typically lower priced items with high volume. In conjunction with that, I would recommend product lines like Jokari and Miracle of Aloe.For more niche markets, I would recommend the Collectibles line or our very popular Security and Defense line."

One of the great things about drop shipping, Maggio says, is that it is almost free to try any of these lines. "Our customer has no inventory investment, no storage, no investment, no concern about dead stock," he said. "They simply post the items for sale, and they only buy after they have a customer who has paid them. That's about as close to a no-risk business as you can get."

Bellissimo Helps Retailers
During the genesis of web retailing, there was normally a wall between e-tail entrepreneurs and brick and mortar shops. But that is no longer the case, as a great number of smaller retailers now sell to consumers both online and offline. Drop shipping for those multichannel players has become a testing ground to enhance profitability.

"It's great for our drop ship partners with brick and mortar stores," says Raenell Agnew, marketing director for Bellissimo! Hand Painted Glasswear. "They can try products on their websites to see if people are interested, before stocking their store shelves. It's a fantastic way to increase your business without the gamble." Agnew's firm, based in Palm Beach Gardens, FL, identified this retail trend early on, establishing a drop ship program in 2004. It charges the same prices for unique items to drop ship clients as it does to wholesale customers. Its product line can be found at www.WholesaleCentral.com/Bellissimo.

In terms of drop ship details, retailers that join receive a compact disc with merchandise images and Excel spreadsheets containing product descriptions and pricing and digital marketing materials. The thoroughly written CD makes it easy to upload Bellissimo's drop ship program to a store's website, including up to 1,600 products. Orders get shipped within two or three days, and can be delivered either Priority Mail or Express Mail via USPS, at no extra charge across the U.S., including Hawaii and Alaska. Every Bellissimo piece is gift wrapped in snowy white tissue paper, and has a blank gift card with product care instructions.

Agnew echoes Ehrmann when she lauds how her company offers wholesale prices via drop shipping, instead of discounted retail prices, because Bellissimo designs and manufactures its own items. "It makes a huge difference," she says. "We serve a lot of Internet retailers and brick and mortar gift shops. But in many cases, we see our customers operating online and offline at the same time."

Innex And MEdropship.com
In addition to Mark Ehrmann Jewelry, EZDropShipper.com and Bellissimo! Hand Painted Glasswear, other quality drop ship programs like Innex Inc. and MEdropship.com are currently thriving and deserve mention in any summary of this service niche.

At www.InnexInc.com, retailers can peruse thousands of excellent items, particularly in the video games accessories niche. Such products include controllers, headsets, cables, adapters, converters, and repair parts. Founded in 2004, Innex boasts facilities in North America and Asia that help clients ship items to customers on time, and with a superb return on investment.

Innex is an exceptional solution for a retailer's drop shipping and wholesaling needs. And the La Puente, CA based firm has been expanding to become a reputable name in mobile, audio and toy products. It also provides its partners with various services which involve sourcing, marketing and design.

Meanwhile, MEdropship.com focuses on fantasy products, including suits of armor, arsenal replicas, bowies, daggers, etc., while offering other categories like jewelry and smoking supplies. The Marietta, GA based company also offers excellent periphery branded items from Hollywood movies like Harry Potter, Batman, Lord of the Rings and Predator. And at MEdropship.com, there are no drop ship fees and no minimum orders for more than 3,000 products.

Companies in this article:
Mark Ehrmann Jewelry
6871 Abbott Avenue
Sebastopol, CA 95472
Tel.: 707-824-8066
Website: www.markehrmann.com

Salco Distributors
13575 58th St. N Ste 200 Dept 125
Tel.: 727-581-5050
Fax: 866-922-9760
Website: www.ezdropshipper.com

Bellissimo Studio
Palm Beach Gardens, FL 33148
Tel.: 561-625-0272
Toll Free: 800-377-6407
Website: www.wholesalecentral.com/bellissimo

Innex, Inc.
16622 E. Johnson Dr.
City of Industry, CA 91745
Toll Free:866-659-7177
Website: www.innexinc.com

3000 Johnson Ferry Rd., Suite 103/104
Marietta, GA 30062
Tel.: 770-309-7756
Website: www.medropship.com

Topic: Product Trends

Related Articles: dropshipping 

Article ID: 1573

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