Intro to Drop Shipping: A Helpful Guide

Published by Denise Mckenzie on Dec 11th 2020

Selling online has become the go-to way to supplement sales for many store owners. It has also become one of the most popular and successful ways to start a new business, especially in the smoke shop industry. How have so many eCommerce stores found such success online? Two words - Drop Shipping.

If you're thinking about listing products on a third party selling site, such as Amazon, or on a platform like Shopify, drop shipping will be your best bet when first launching. You must keep in mind, however, that every business handles drop shipping a little differently. The processes will be unique to each company's shipping strategies. You'll quickly learn that many companies that wholesale products offer drop shipping as an option. Still, overall policies and processes will vary depending on each business.

Windship Trading Co. has many eCommerce and online sellers who continue to find profitability using our drop shipping services. Here is a quick overview of what exactly drop shipping is and how it works.

What is drop shipping?

Drop shipping is an order fulfillment method for retail businesses who cannot or choose not to invest in housing inventory themselves. Instead, a third-party distributor or wholesaler who supplies the product will ship directly to the retail customer. This means the store will not have to purchase or stock any inventory, saving significantly on overhead costs.

That said, if you own a brick-and-mortar, setting up an online store just makes sense. Think of it as a secondary option or even a second store location that caters specifically to online shoppers. You have the opportunity to expand your customer base beyond your local area. You're basically opening up your store to the entire world. Why leave those potential profits on the table?

If you're a new store, using a drop shipping program will be incredibly beneficial when you're starting out, especially if you sell solely online. You're able to list as many products as you can handle. Your job is mainly to get the word out and make sales using social media and ad space. Of course, you'll be maintaining your website and managing incoming orders. Still, all in all, the supplier handles the heavy lifting, so to speak.

Drop shipping has its benefits and disadvantages.

As with pretty much any business model, drop shipping has its pros and cons. As we said earlier, it'll help keep overhead costs down, and you won't have to worry about having the space to keep inventory, which is great! It also allows the opportunity to explore different products to see which work best without forking out the money ahead of time. Plus, you won't have to worry about getting stuck with slow-moving inventory.

However, there are important factors to consider. The online market is much more flooded for the smoke shop industry, as with many others. This could result in matching lower prices to stay competitive. You might notice you're making less off individual sales, but you may end up selling more across the board. Another possible factor to consider is that you'll sometimes run into inventory issues and occasional supplier errors.

You may be concerned about some of these disadvantages, and that's okay! Just remember to keep in mind that your competition will likely be dealing with the same issues at one point or another with other third party shippers. As long as you find a reliable supplier, promote your shop, and practice good customer service, you'll learn all the nuances and know what to do. Utilize the right tools, and before you know it, you'll be able to manage drop shipping like a pro.

How it works at Windship Trading Co.

Now that we've gone over the basics of drop shipping, it's time to learn how we do it. If you already have an account with us, that's great! Hit up your sales representative to get started. If you don't have an account with us yet, you can request one here. Just fill out the wholesale application and let us know you're interested in drop shipping.

Windship Trading's drop ship program is pretty straight forward and probably similar to others you may have heard about it. But, just in case, here is a helpful guide to placing drop ship orders with our company and a few pointers for making the process as seamless as possible.

Your next steps.

The order process starts with you and your website. Once you list the products and receive an order, follow these steps to get the order shipped out to your customer.

Step 1 - Contact your sales rep to check product availability.

Before communicating with your customer, we highly suggest reaching out to your sales rep to make sure the item purchased is in stock. In most cases, stock quantities will not be an issue. However, there may be times when some items are not available right away.

Step 2 - Communicate the order status to your customer.

If the item is currently out of stock, your sales rep will provide you with an ETA, which you can then pass along to your customer. If the product is available, you can let them know the order is now being processed. Give them a head's up that they'll receive tracking once it's shipped.

Step 3 - Forward the order details to your sales rep.

At this point, all you have to do is to email the product and customer information, along with shipping details, to your sales rep. Be sure to include any specifications, such as size, color, or quantity, and any special shipping instructions or notes.

We take it from here.

Once we have the order in our hands, your sales rep and our shipping team will handle the rest.

Step 4 - The rep creates a sales order and sends it to the warehouse.

The rep will then build the order, adjust the pricing accordingly, and forward it to the fulfillment warehouse. Currently, we have shipping centers in Florida, Texas, and Nevada. For U.S. domestic orders, this means that the turn around time for delivery is pretty quick, no matter where they're located.

Step 5 - The Drop Ship Fulfillment team picks and packs the order.

We have a warehouse team explicitly dedicated to managing our drop-ship orders to ensure each one is processed with urgency and executed successfully.

Step 6 - The order is invoiced and billed to your account.

After the label is created and the order is awaiting shipment, our accounting team will charge your account based on your available payment options. You will not be charged for any back ordered items.

Step 7 - The order ships directly to your customer.

Once the drop-ship order is picked, packed, and labeled, it ships out from the fulfillment warehouse via USPS or UPS. If you prefer one shipping method over the other, that's fine! We're able to set a default carrier if you'd like. Otherwise, we'll choose the best available shipping method depending on size and weight.

Step 8 - Track the order and let your customer know where it's at.

After it ships, we will provide tracking information on the invoice to pass along to your customer, so they know exactly where their order is. We strive to process orders within twenty-four hours, with some exceptions during Covid and holidays. We also never include our invoice in the order and do not use our business address on the return label.

Looking towards the future.

There's always a better way. As the new year unfolds, we'll be looking for different ways to scale and refine our drip shipping services. Our goal is always to improve the overall customer experience and to simply make things easier for everyone. The more we streamline our programs, the better the results not only for us but for your business as well.

Send your drop shipped orders directly to the customer!

Start your drop shipping business today.

Whether you're thinking about taking your brick-and-mortar shop online, or you're ready to open an eCommerce store, consider using our drop shipping services to start generating sales. Reach out to your sales rep or contact our team for more information.