Finding Dropship Sources

Dropshipping is a supply chain management technique for retailers, most commonly used by online "etailers". The marketplace seller does not physically stock the goods, but fills orders as they come in to ship directly from the wholesale manufacturer. Finding quality dropshippers can be the difference between success and failure for an small online retailer. 

What are the Advantages?

One of the obvious advantages to dropshipping is that there are relatively low barriers to entry as a business. Because the retailer does not have to physically stock inventory, significant startup capital is not needed. Similarly, the wholesale company takes care of the packaging and shipping, meaning that the logistics only consists of the retailer entering their customers shipping information and paying for the order. 

What are the Disadvantages?

The disadvantages are the flipside of the advantages. Because the retailer does not have physical control over the inventory or the logistics, alot depends on having a quality wholesaler at the source. While there are many reputable wholesalers, wholesaler distributers, and paid wholesale directories, there are also scams. The more distributers between you - the retailer - and the original manufacturer the less profitable margins tend to be. 

If you really do not like spending money and are running your operation on a shoe-string budget, using search engines like Google to discover dropship suppliers is often your best (and only) bet. Google is a vast potential gold mine for product sourcing and discovering dropshippers, but it must be mined with caution. For every great reliable dropshipper there is one less than honest dealer looking to scam you into thinking they are legitimate. 

Over time you will learn to distinguish the genuine from the imposters. It becomes a sort of "sixth sense" or a gut feeling. In the meantime there are a few questions you can ask to determine if a dropshipper is indeed legitimate:

1) Do they ask for a monthly service fee?

If the company is a legitimate wholesale dropship company they will not need a service fee to make money. Monthly or even yearly fees should a huge red flag. A dropship fee for an individual order to cover handling is not necessarily suspect, however. 

2) Are they rated by the Better Business Bureau?

The best dropshipping companies are rated by the BBB and are not afraid to display this prominently on their home page. 

3) Do they ensure "blind dropshipping"?

Blind dropshipping refers to the wholesaler shipping your customer's orders with no marks identifying or advertising for the wholesaler itself. Some dropshippers will offer to include your logo and store details as a bonus!

These three questions will generally weed out the scams. One thing to always keep in mind is that some "wholesalers" are not true wholesalers but are acting as distributers, often for multiple companies. If this is for a geniune dropshipping service then this is usually fine, but always be aware of the links in the chains of supply. 

For online retailers looking to grow quickly and avoid some of the pittfalls fo Google searching for dropshippers, paid dropship directories can be a good way to go. Investing in just a few of them can mean a virtually unending stream of qualified dropshippers to sift through. Because sourcing is the number one problem, paid dropship directories can save you hours of time and many painful lessons learned. 

The problem with "free" dropship directories is that they are generally not thoroughly reviewed for quality wholesalers. Almost every paid dropship directory has a free trial period and/or a money back guarentee. It does require an up front investment of money, but it is a small price to pay to get a profitable e-tailer up and running. 

Below are the top dropship lists that I have personally used at some point to grow my business. They are not necessarily each right for every seller, but do the investigating on your own to see if they could help you.