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Posted by: Mike on 2010-10-06, 22:25:41
Starting a drop shipping business is not easy. According to statistics 95% of online business owners fail in the first year. Why? Here Are The Top 6 Challenges Every Retail Business Owner Is Facing: 1.Economic downturn 2.Incorrect Target Market 3.Product risk 4.Cash Flow risk 5.Inventory risk 6.Not enough knowledge about marketing 1.Economic downturn If the economy suddenly goes down, consumer are less willing to spend money on luxurious goods. If you have a lot of inventory ($2000 or $10,000 worth of good in your warehouse), than you are in big trouble. With drop shipping you don’t have that inventory risk. 2. Incorrect target market Let’s say you think, you have found a great solution. You buy the good at wholesale. Put them in your retail store or at your online store, but nobody is buying! It happens; choosing the wrong target market without testing it first is a very common mistake for every business owner. With drop shipping your don’t have that risk. You just put the product in your online store and see whether people are buying or not. If nobody buys, you didn’t lose anything, because don’t have the inventory. If someone purchase the product from you, than you can place the drop ship order at your drop shipping company 3. Product risk You’ve got a lot of refunds. Your product is suddenly failing to work properly making your customer very angry. You want to avoid this buy find a reliable drop shipping company and test their product first. Don’t assume that every drop shipping company has quality products. I will leave risk 4, 5 and 6 for you to fill in. Here are first basic steps that you need to do before starting a drop shipping business 1.Find a niche market (I recommend health products) 2.Find a reliable drop shipping company with good customer service 3.Find a quality drop shipping product 4.Put the drop ship product at your online store 5.Start an online marketing campaign I use drop shipping, because I don’t have buy any inventory, so I can focus on marketing. Go to Google and visit those drop ship directory list. Make sure you call them. Talk with them. Ask them how they ship the product. A reliable drop shipping company must have good customer service. What happens if something goes wrong with your shipping? How can you contact them? So, make sure you call them and test their respond! You can find more information about drop shipping works here: bigdropship.com/ dropship-menu/ how-to-dropship.shtml |
