What is a Drop Shipper & How Does Drop Shipping Work

Andrew Youderian • August 10, 2012

I get asked a lot about drop shipping, so I sat down to write a brief post answering a few of the most common questions.  Nearly 5 hours later, I was still writing and my “quick little post” had ballooned into a 4,000 word beast!

To make the information a bit more manageable, I created a drop shipping resource library broken up into four different sections, all outlined below.  If you see an interesting question, click on the appropriate heading to get more information.  If I missed an important question or topic, let me know in the comments below and I’ll make sure to add the answer.

Basic Drop Shipping Principles

What is drop shipping and how does drop shipping work?
What is a drop shipper and where can I find drop shipping suppliers?
What are the benefits of drop shipping?
What are the disadvantages of drop shipping?
What kind of profit margins can I expect with drop shipping?

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Finding & Partnering with Suppliers

How do I find drop shipping companies?
Should I use drop shipping or buy products in bulk?
What’s required to work with a drop shipper?
What kind of fees do drop shippers charge?
What is the difference between a manufacturer, a wholesaler and a drop shipper?
How do I know what products to drop ship?

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Starting & Running a Drop Shipping Business

What do I need – and much does it cost – to start a drop shipping business?
Is drop shipping legal?
Do drop shippers provide customer service and/or talk with my customers?
How do I submit orders to suppliers?
What is the turnaround time for fulfilling a drop shipped order?
How do I get tracking information for orders?
How do I pay my supplier?
Who pays for the shipping costs on orders?
Do orders appear like it came directly from my company?
How do returns from customers work?
Who pays for the shipping on returned items?
Do drop shippers ship internationally?

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Avoiding Drop Shipping Problems

How do I make sure customers don’t order out-of-stock items?
What happens when mistakes are made regarding fulfillment?
Isn’t selling items that you never see difficult?
Do I need to worry about fraud with drop shipping?
How can I determine if I’m dealing with a quality drop shipping wholesaler?

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Photo by Ninja M

Post by Andrew Youderian

Andrew is the founder of eCommerceFuel and has been building eCommerce businesses ever since gleefully leaving the corporate world in 2008.  Join him and 1,000+ vetted 7- and 8-figure store owners inside the eCommerceFuel Community.