Drop shipping is the first sourcing methods that most beginners are attracted to. The concept sounds great, sell products before you buy them, and then pay for the product and they ship it to your customer. This method does have the largest source of any of the product sourcing methods. Be sure that you are dealing with the actual drop shipper and not some middleman that is acting like one and charging a toll charge. This method can work if you are in a very very narrow niche’ product where there is little or no competition. Otherwise the profit margins are low and it can be difficult to sell for a price higher than what you need to pay the drop shipper. If you can afford to do so start with any of the other product sourcing methods below for finding products to sell online for a profit.
Wholesalers will sell you products for about a 50% discount below what you would expect to sell the product for retail for. Some companies out there will say that they sell wholesale just to attract the extra business. You can normally tell who are serious wholesale companies because they will require you to have a reseller id in order to purchase from them. You can just Google “reseller id” and find out how to get an id in your state. This allows the wholesaler to sell to you without charging tax because they notify their state that their customers are going to charge sales tax when you go to resell the product online, or in your retail store, etc.
Liquidators can get their products that they sell you from a variety of different sources. Sometimes these can be products that were returned to retailers from customers that and it is not cost effective for the manufactures to repair them, so they will just throw many similar products on a skid, then sell all of the products together at very steep discounts. This could be a good source for you if you know how to repair a certain type of product. Sometimes you can get some really great deals because the liquidation houses are not at all experts on the products, and they will auction off the merchandise without any idea as to how much they are worth.
Sourcing products from China is now much easier than it used to be with a lot less risk. Most good product sourcing companies can turn you onto sites that will let you find suppliers all over the world that make the products you are looking to sell. Most of the sites have rating systems ranking the companies that help eliminate some of the risk of purchasing overseas. The newest way to source products for your customers is to drop ship the products directly from china. Most of the products that you find can be purchased for around 10% of what the retail price is. If you sell a product there are a few importers that can ship from China to your customer in the US within 3-5 days after you place the order with them. This is an acceptable delivery timeframe for most people. You should always test their service by sending a product to yourself before taking a customers money.
Ez – Importers
This is importing with an extra person or company in the supply chain. Many of the best product manufacturing companies overseas do not have anyone that speaks our language this is where an EZ-importer can help. They are a middle company that will handle the transaction and send you the products that you desire. Think of this as Importing for Beginners.
Where do I find these companies?
You can use what is called a product sourcing company. These are companies the provide you with information on the right companies to do business with for a membership fee. Some of their yearly fee’s can be as high as $350.00 per year. Be sure to stay away from anything out there that is just a list of companies. The top companies will allow you to search the inventories of hundreds of companies and then bring you to the ones that have the product that you are looking for. This will save you tons of time in the future. You will save valuable time by only working with companies that have what you are looking for.