Drop Shipping Wholesaler Risks

We’ve talked before here about the benefits of drop shipping wholesalers, and how using this kind of a service can free you up to spend time actually marketing and selling your products, rather than hassling with things like inventory and shipping. While there can be tremendous benefits to working with a drop shipping wholesaler, there can also be risks as well. Knowing what those risks are ahead of time will exponentially increase your chances of avoiding them.

Here are some of the major risks of using drop shipping wholesalers:

1. You sacrifice a certain amount of control over the shipping process. Because you’re not in charge of the packing and shipping process, you can’t determine when delivery will take place. If you did your own shipping, you could address delays as they occur. When you use a drop shipping wholesaler, you lose this control over your business process.
2. Some wholesalers don’t perform well. In fact, if you were to just randomly select a half dozen wholesalers and start doing business with them, it’s likely that you’d be unhappy with the majority of them within just a few months. You may have to deal with goods that are poorly made, delivery delays, other delivery problems, and in some cases even fake products. When you start with a wholesaler, you just don’t know how well they’ll do.
3. When you use a drop shipping wholesaler, you place your reputation and the reputation of your business in their hands. For example, if you sell products on eBay and the wholesaler messes things up, it is your feedback score that will suffer.
4. There is a risk that your product may be out of stock. While many wholesalers try to put in safeguards to help you avoid this kind of a situation, it’s always a possibility. If you sell a product to someone and it’s out of stock, you’ll find yourself issuing a refund and damaging your reputation.

All of these things shouldn’t scare you away from the idea of using a drop shipping wholesaler. Instead, you should be determined to find the right company to work with. You want someone who has a solid reputation, who is known for accuracy and quality, and who will not tarnish your good reputation with their mistakes. Again, the benefits of using a drop ship wholesaler can outweigh the risks, but only if you choose the right drop shop wholesaler to work with.