Posts Tagged web business
One popular method of making money from your website, or websites as the case may be, is via banner ad revenue. Banner ads are advertisements displayed on your website that drive traffic to other peoples’ websites; these people pay you a either a set rate or a fee per each customer that visits their business by clicking on the banner they paid for on your website. There are a number of methods for monetizing your website available to consider, so don’t just stop at banner ads when you’re looking for methods of making a some cold hard cash from your web domain.
Banner ads are getting harder and harder to make money from as more and more companies begin changing over to pay-per-click payment methods. Where does this leave you if the only income coming from your site is banner ad revenue? If you like spending time browsing the new, you probably see thousands upon thousands of banners each day, and you’ve probably never had the urge to click on any of them - which is fine when you’re a browser, but for a business owner it’s the pits. There’s been a broad range of business that have lost about 10% of their avenue because of this drop in banner revenue since the start of 2009.
But if you don’t want to lose all of your banner ad revenue, what options do you really have? An option that you might want to consider is selling products on your site with the help of a wholesale supplier that does drop shipping. This will be particularly successful if you locate and promote items that already appeal to the target audience of your website.
However, because banner revenue takes so little work, and selling products with a drop shipper requires some work, you may not think this is a very appealing option. However, working with a whole sale drop shipper actually doesn’t take TOO much work - only a little. If you use a third party website like eBay, or have your own shopping cart set up via your site, you need some kind of system to make sales. In order to make money, people need to be able to locate and have a clear idea of the products you are selling that they want to buy.
After that, you just need to sit back and let your website make sales - all you have to do is tell the drop shipper when a sale comes in! In reality, this is the same amount of work it would take to set up a banner ad revenue system.
Just make sure you keep in touch with your wholesale drop ship supplier, and keep them up to date on your orders. You will have to give them a portion of the payment from your customer in order to pay for the items, but that’s a small price to pay for how little work you’ll be doing.
And every time you make a sale, you’ll make a decent chunk of change - unlike banner ad revenue, which pays in tiny increments. Instead of selling plots of your web presence to other people, create a retail outfit that will make you money with minimum effort.
Check out several reputable drop ship suppliers to find one that that offers products that your customers will be interested in, and start making a much bigger income with your website today!
One of the primary benefits of drop shipping that many newcomers fail to recognize, is that you can increase your product line with different drop shippers who offer different products, and often with different countries of origin. In this way, drop shipping can be a real boon. But it depends really on knowing your drop shipper, and going the extra mile in cultivating drop shipping relationships, whether they are local or international in origin.
And therein lies the negative in drop shipping for the online retailer. You have to make the effort to cultivate those drop shipping relationships–there’s really a lot more to it than just signing up online and picking products from a catalog. If you simply drop ship with someone based solely on the convenience factor, you might find yourself without product or even worse, you might find yourself without a drop shipper at all. This happens as a result of one of two things. First, if you are without product for a long period due to production delays (which will happen regardless of source, by the way), it means your drop shipping source didn’t tell you he was running low, or you didn’t make the effort to inquire as to his projected inventory or production that would affect your product lines. If you cultivate those relationships, drop shippers will tell you in advance when things are getting dicey, and they might even tell you without your inquiry. Always keep up to date on your product. Always.
Second, and even more importantly, drop shippers who have cultivated relationships with you might tell you if they are going out of business. Think of the drop shipper as your friend: a friend will tell you before he goes out of business when things are out of control, whereas the general public will not get notice until the business is already liquidated and gone. When you cultivate these overseas or local relationships, you can save a lot of headache for your business, and you can keep your product and cash flow running smoothly because you know what is coming down the road that others might not get wind of until it is too late to do anything.
Seeing the hurricane and watching the weather reports can save a world of pain long before the hurricane ever comes ashore. Take it from someone who has seen the hurricane and prepared, and from someone who didn’t plan for the coming storm and paid the price many times over.
If you’re in the business of wholesaling or an integral part of the e-commerce industry, then you’ve likely shown your face at a few tradeshows far and wide. Despite the type of product that you’re manufacturing or selling, there is almost definitely a tradeshow devoted to showcasing and highlighting your spin on an otherwise “common” product. From furniture to area rugs to tools, cookware, lighting and everything in between, many manufacturers and wholesalers set up shop in a dedicated showroom several times each year to demonstrate the value and versatility of their particular product offering.
Because product communities gather to market their updated lines and new additions a mere handful of times each year (generally quarterly), it can be a pivotal time for wholesalers and retailers alike to be caught up to speed in regard to product categories that are likely to experience significant growth trends. By attending tradeshows, you allow yourself to pick and choose from the best of the best in order to seek out a selection of products that will likely propel your overall business sales.
In addition to viewing fresh product first-hand, tradeshow attendance allows you to network with other industry professionals. Here is where you can not only catch a glimpse of product designs and ideas, but where you can also converse with experts and gain insight into styles and patterns that can positively influence your current or future product offering. These perks alone will enable you to effectively determine what is and what isn’t working for your target audience, and then allow you to capitalize on ways to capture potentially lost sales. Perhaps a particular manufacturer has designed a product that could work with a few modifications – use this opportunity as a chance to revitalize your product offering so that you can garner the interest and attention of a particular sector of your audience.
Further, tradeshow attendance can be instrumental when it comes to branding. Getting your name out there in markets that are generally already quite saturated can help your cause significantly. Introduce yourself to prominent market players and try to solidify partnerships that boast the potential to drastically assist your brand or your goals. Showing legitimate interest in your business and in your competitors can help you to stand apart from the rest. Respect your competitors and allow their successes to aid yours. Don’t be short-sighted, look at how past mistakes have affected both your business and the industry as a whole, and work to remedy these issues.
Tradeshow attendance is critical to the overall success of a given market. These venues help to spark new ideas, new partnerships, and new market players. Wholesalers are generally looking for credible retailers to help them with their sales while retailers are seeking the same benefit. It’s this type of mutualistic relationship that enables product markets to effectively and efficiently continue to grow and develop over time.
While the business of wholesaling can result in tremendous profits, there are a number of factors to consider prior to simply beginning your company. From surveying and understanding your potential market to weighing cost factors and margins to finding a product niche that suits you and your competitive needs, there are a plethora of elements to analyze as you get started.
With so many product markets seemingly becoming increasingly over-saturated, it can be challenging to find a niche that has the bandwidth to accompany yet another fresh, new idea. However, this shouldn’t deter up and coming wholesalers from overcoming potential obstacles. Do your research and get a firm grasp on your competitive landscape. Closely monitor what competitors are doing, including concepts that have worked as well as those that have not. See if you can modify any of the less successful ideas and transform them into top-selling products. Investigate ways that will enable your line of products to stand apart from the rest. Understand what your target audience is looking for and how you may be able to modify existing products so that they more effectively appeal to your consumer base.
Does a particular product category boast more potential in terms of margin, revenues, and profits? If you’re fortunate enough to have the option to choose among several various product categories, then profit margin is what you should use as your determining factor. Because it can be difficult to differentiate your product offering from those of competitors, you’ll want to ensure that you’re earning money with the items that you’re able to sell – particularly with those items that virtually sell themselves. Further, ensure that your total costs are significantly less than the amount of which you can realistically sell a high volume of product.
While you may not be able to create a totally unique product, it’s important that your offering boasts distinct features unique to your mission. Find products that can be and distributors that are willing to drop ship so that you can reduce your overhead costs. Moreover, ensure that there is substantial demand for your products and services. If there isn’t a distinct market need for what you’re hoping to sell, then cut your losses immediately, and develop an alternative business plan. Adding a new facet to a standard, convenient product can add to its resale value.
Despite your specific financial goals, it’s important to understand your market before you move forward with developing your business plan and just jumping into a product category. Make sure that you can identify potential pitfalls and drawbacks and immediately strategize ways to prevent these issues from affecting your future successes. Perhaps most importantly, refrain from spreading your resources too thin. While you may see potential in selling a vast variety of products, it’s best to start with one targeted niche and to work on expanding from there.
Drop shipping has garnered quite a lot of attention over the past few years, presenting an easy way to become an Internet retailer. Is it just another get-rich-quick scheme? Multi-level pyramid deal? Flash in the pan? Not really. Like anything, you do have to put some energy into it. When you first consider the concept of drop shipping, it seems remarkably simple. You don’t have to carry any inventory, and you don’t have to do any shipping. You just put up a web site, send the orders to the drop shipper, and collect the checks.
Well, it’s not really that easy, folks. Successful drop shipping involves successfully doing two things: Making a good product selection, and marketing. On the product selection front, it’s easy to just load up everything the drop shipper has to offer into your virtual catalog, but a more effective method is to create a niche for yourself—specializing in one particular area. Don’t try to be everything to everybody, because the customer will just get lost. Specialize in one area and position yourself as the expert in that area. On the second front, marketing—again, it’s easy to just put up a web site, but will anybody see it? How many web sites are out there today? With no marketing, again, it will get completely lost.
That said, drop shipping can be an effective management technique, especially for handling inventory.
Drop shipping, for the uninitiated, is a form of inventory control whereby the retailer sells his items to the customer, but instead of having a supply of the item on his shelves for immediate delivery, the retailer orders his items directly from the manufacturer or the wholesaler, who then ships them directly to the retailer’s customer. In this way, there is no need for the burden of carrying inventory. The retailer still retains his profit margin as a difference between the wholesaler’s or manufacturer’s price and that of the retailer.
Often, the final customer never knows that the retailer is drop shipping his merchandise because the retailer chooses not to disclose this up front, thereby hiding his inventory control from view. There are several ways to hide the drop shipping from customers. The best way to do this is to have the manufacturer or wholesaler ship the product with the retailer’s name and logo on the packaging slip.
The benefits are obvious: no inventory means less cost can be passed on the retail customer, and the retailer retains positive cash flow throughout the entire process. The potential downside is that it may take longer for the customer order to be fulfilled, since it’s going through a third party, there may be a backorder that the retailer is unaware of, and the retailer’s markup will not be as high as if they were sourcing, warehousing, and shipping the product direct.
In part two of this article, I will explain a few of the positives and negatives of drop shipping in more detail, and how the retailer who drop ships can benefit in the end. To be sure, there are negatives to the drop shipping idea, but they are manageable if you know how to navigate the drop shipping maze.
Importing from a wholesaler overseas is often a superior strategy for getting goods very cheaply. Let’s face it, many of the products you are going to sell come from Asia–and the closer to the source you get, the better your wholesale price. You may get a product from a stateside distributor at what seems like a good price, but where is that distributor getting it from? Either from another distributor in Asia, or direct from the manufacturing facility. Now I’ve always advocated just going there yourself to examine and select the products in person, and then arranging shipping directly, but that is admittedly a major task, and it probably takes some foreign language skills, and believe me, languages like Thai, Mandarin, Cantonese, or Japanese are notoriously difficult to learn.
Either way, it pays to understand the shipping terms. It may well be that although you would get a better wholesale price from the Asian source, your overall cost–including shipping–may still be cheaper if you have a distributor close to you. Here’s the first thing to know: Suppose you buy a shipment of items from a source in Asia, and the terms specify “FOB Hong Kong.” That means the source is responsible for getting the goods to the port in Hong Kong, but from that point, you’re responsible for the rest of the costs.
The second thing to know is that shipping costs aren’t just what you pay the shipper. There may also be a customs tariff due upon arrival, as well as a customs bond, cargo insurance, and a clearance fee. there may also be an additional “last mile” fee involved. Where is the nearest port to your home or office? Sea freight comes into the nearest port. Your shipping fee may cover the cost of shipping from Hong Kong to San Francisco, but your office is in Nevada–so there’s an extra fee for shipping it over the last leg, unless you want to make the trip to the port and pick it up yourself.
When you calculate it all out, you may still be better off paying a slightly higher price to your stateside distributor, as opposed to going direct, especially if you are buying in smaller quantities. On a per-square-foot basis, shipping over a couple boxes from Taiwan or Bangkok is a lot more expensive than shipping an entire container load. Your distributor is getting an economy of scale on shipping, more than likely bringing items over in large containers, and as a result they don’t have to add on as much to the price when they sell it to you. Shipping cost per item may be several times more for you, if you’re just buying small amounts.
When you bring in goods from overseas, there are some complexities involved, and the US customs department will make your job just a little bit harder–or maybe, a lot harder, depending on how you approach it.
If you’re working with an overseas supplier, they will take care of most of the paperwork; all you’ll have to do is pay the customs bill. But if you’re overseas yourself acquiring goods, and you want to ship them back to yourself in the States, you’ll have quite a lot of paperwork to do. Your shipping company can give you a good idea of what you need, and can probably provide you with the paperwork.
You will complete a bill of goods, which shows exactly what is in the box–and here’s where a lot of importers spend unnecessary money on customs duties. On this list, you need to itemize everything. But what you need to realize is that tariffs are enormously complex, and you need to be very precise. For example, the tariff you will pay to receive a box full of cotton shirts will be different from the tariff on a box full of silk shirts. The same holds true for any item, and you always must specify as much detail as possible. Have a box of chopsticks? If you simply list it as “chopsticks,” customs may delay your shipment, because they don’t know what they’re made out of. Say “wooden chopsticks,” “ceramic chopsticks,” or “plastic chopsticks,” to be more specific. You’ll also have to specify the country of origin, failing to do so can also cause delays. And so, the tip of the day is this: Be painfully specific, even when it’s obvious. Customs officials never make assumptions, and if you don’t explicitly say what they need to know, they’ll send your paperwork back to you.
If you’ve been thinking about starting a business that uses wholesale suppliers to drop ship products to your customers, make sure you don’t miss the first, and most important step. You need to decide, in the beginning, what niche you want to choose for your business. The niche you choose will impact everything about your business, from the wholesale suppliers you choose to the type of marketing plan you decide to implement.
You see, an entire market is too broad for all but the largest of companies to try to take on. For a small business, especially one that’s just starting out, it’s best to divide the demand in the market into smaller, more manageable niches. By operating your wholesale business in a specific niche, you can focus your efforts on a specific type of buyer who’s looking for certain specialized goods.
One of the most important components in choosing a niche for your wholesale business is doing a market survey. You need to do a market survey in order to understand what products are being sold in a niche, as well as the areas that your competitors are already entrenched. By taking a look at the market, how much product is being sold and who is selling it, you can figure out where you belong. Ideally, you’re looking for an arrangement of factors including price, service, quality and product type that will maximize your sales while facing the least amount of direct competition.
You also need to consider your own interests and abilities when you’re choosing a niche for your wholesale business. For example, if you have no interest whatsoever in consumer electronics, it probably isn’t a great idea to start a consumer electronics drop ship business. The fact of the matter is that your desire and passion are a key element in being able to see your business succeed. Choose a niche that you know something about, and that you have some interest in.
As you go through the process of finding a niche, try to avoid thinking only about wholesale suppliers and costs. You might be able to buy products at a wholesale price that’s extremely competitive, but if you can’t find someone to buy those products or you can’t effectively market those products, your business won’t succeed. In addition, low wholesale prices also mean that your competition probably also has access to that kind of pricing, meaning you’ll have to find another area, whether it’s service or marketing, in which you need to offer something to your consumer that your competition can’t offer.
Many people who enter the drop ship business do so with plenty of motivation, but with very little in the way of planning. The fact of the matter is that a drop ship business isn’t all that different from any other business, in terms of what it takes to succeed. One of the most important steps in starting a small business of any type is to develop a solid business plan.
It’s important, first, to understand exactly what a business plan is. The business plan is a document you create that defines the goals of your business, and that outlines the procedures your business will follow in order to achieve those goals. A business plan is essential if you need to raise capital for your new business. In addition, the business plan acts as something of a blueprint in the areas of management and finance for starting up a profitable business venture.
Why do you need a business plan to start a drop ship business? A business plan does several things for you. As we mentioned earlier, it helps in the process of trying to raise capital. Any investor that you want to ask to help your business get off the ground is likely going to want to see a solid business plan before she lays out that capital. This is especially important in the drop ship business realm, as many investors may not be entirely familiar with what a drop ship business is or how it works.
A good business plan also helps you know where you’re going. The business plan should include, for example, financial projections. It should be able to project when the business will go from becoming a start up business to actually becoming profitable, for example. While a business plan isn’t a magical crystal ball able to tell you what happens in the future, you can use the business plan to identify at what stages the business truly starts to make money.
A final area that a business plan can help your drop ship business is in the area of the market. Part of what goes into a good business plan is a market analysis. This allows you to identify your competition from the start, and figure out how you can get an advantage over the competition. A solid market analysis is essential to knowing whether or not you can expect your drop ship business to succeed, and how soon you can expect it.
Unfortunately, one of the realities of the world we live in is that there are scammers out there who hope for nothing more than separating you from your money, and who offer nothing in return. This is as true in the world of drop ship wholesalers as it is in any other type of business. Whether you’re just starting your drop ship wholesale business or whether you’re considering changing suppliers, knowing how to avoid drop ship wholesale scams is essential.
The key here is being both cautious and skeptical. Regardless of how well designed a website is, for example, it could be a drop ship wholesale scam. Just because you’re more comfortable looking at a larger, well-designed site doesn’t mean they’re any more legitimate than the poorly-designed two-page site.
In this regard, one of the most helpful resources you can have is a drop ship wholesale directory. A reliable directory will not only help you to find wholesale suppliers, it will help you to weed through them. Some directories offer reviews of specific suppliers. Other directories have a feedback sort of rating system set up that allows members to rate the various suppliers. In most cases, the vendors listed in directories are free from wholesale scams because the directory is able to weed out the scammers.
You can also do some legwork on your own. For example, a reliable wholesale supplier will be able to provide you with a street address and a phone number. Look up the street address, to make sure it’s legitimate. Call the phone number, and talk to the supplier directly. Make sure you also check the phone number and address online, to verify that there aren’t reports of the business scamming people.
Word of mouth is another great way to weed through wholesale suppliers and avoid scams. You can talk to other business owners about their experiences. Find out what wholesale suppliers have been reliable, and which ones haven’t been as reliable.
You might consider checking with the Better Business Bureau, as well. While not every company has a listing with the Better Business Bureau, you can bet that companies that are scammers have probably had complaints filed against them. In some instances, you might also be able to check with the attorney general in the state where the wholesale supplier is located to see if there are pending cases against the supplier.