Recently, I had to buy some vinyl for a project I was doing, and I noticed that a lot of the websites I visited to get what I needed had three ways to place an order. The first was through an online shopping cart where you found what kind of vinyl you wanted, selected the amount of yards, put it in your cart and checked it out. The second method was to call the company and place the order over a phone, and the third was to fax your order in. As an administrative assistant, I receive a lot of faxes, and there are some faxes that I get that are dark, hard to read, or just complicated. This brings me to our topic today: why you should avoid using faxes, or how to build a system where fax orders are actually effective.

Steering Clear Or Embracing Your Wholesale Fax Orders The Right Way

Why Fax Orders Are Detremental

1. They’re Expensive

In the case of actual dollars and cents, faxed orders cost paper, labor, etc., as well as other expenses like low customer service or losing a customer all together. Studies have shown that a faxed order, due to it’s manual nature, can cost up to $60, whereas the typical online order can cost a mere $1-$3 to process.

2. They Could Lead To Errors

When people fax things in, they sometimes are typed documents, but my experience has shown that most are either one of thee categories. Some people will type something out, but then write on the paper they fax it, others will have something completely typed, and there’s the completely written faxes. Depending on the quality of your fax and their fax, their message could turn into a dark mess of things that are partially clear and legible, but that’s not something you want when trying to process an order for someone – you need to know exactly what they want and how they want it. Aside from the actual receiving of the fax, there’s also the amount of handling, or the number of hands that touch the one order, that could cause error. For every person that touches the fax, there’s a possibility for error and it also makes it hard to keep track of the status of the order.

3. Limit Productivity

Because faxed order take longer to process, they limit your productivity levels.

How To Make Faxed Orders Actually Worthwhile

1. Avoid These Programs

Some companies opt for electronic faxing systems that turn the faxes into an image or places the information into a template. However, these can also have their downsides. When it comes to things that are hand-written, a system software could have a hard time figuring out an s and a 5, an I and a 1, etc. Also, if you have to change something in your system, it could possibly make all your previous templates / orders in the system change which could corrupt your possibility of looking for something in the archives for a repeat order or an audit. In general, these kind of systems have a hard time distinguishing between handwriting as well – if people have a hard time figuring it out, the computer might as well.

2. Get Something To Do It All

If having faxed orders is something that you would like to have with your business, make sure to invest in a software that covers basically what an automated order would cover – the ability to handle document routing, data capture, automatic archiving, prioritizing orders, and will keep track of when an order was received in case that customer calls soon after to change something.

Education, Uncategorized, make money online, pricing and profits

In this, our third and final installment of how to avoid shopping cart abandoment, I’m going to talk about how to keep your shipping costs low.  Shipping costs are huge in e-tail: it’s the number one concern for the majority of online shoppers, above the fear of getting their credit card number stolen or not liking the product that shows up in the mail.  Your goal as an onliner retailer is always, always to keep your shipping costs as low as possible.

However, there are other factors to consider: should you every charge your customer more than what shipping actually costs?  Should you add the cost of shipping onto each order, or offer “free shipping”, sneaking the cost of shipping into the price of your item?  Should you ship your item in the cheapest, or the most secure way possible?  Check out the FAQs below for answers.

How To Keep Shipping Costs Low:

If you are purchasing your products from a dropshipper, you don’t have much control over how your items are packaged and shipped.  Therefore, you can’t do much to influence your shipping costs.  The first two tips are for e-tailers who use dropship suppliers, and the subsequent tips are for e-tailers who package and ship their own orders.

1. Try to stick with one dropshipper IF that dropshipper has lower fees for multi-item orders

Some dropshippers will charge less to ship multiple items in a single order. For instance, one t-shirt dropshipper might charge a $3 dropship fee per t-shirt, no many how many are being ordered.  Another dropshipper might charge a $3 dropship fee for the first t-shirt, but only $2 for subsequent shirts.  If you are working with a supplier like the latter, you can keep your shipping costs low by ordering all your products from that one supplier.  Obviously there is a trade-off here – you would only want to use a single dropshipper if their prices and selection were great, and you were satisfied with their product line.  But it can help you avoid high dropship fees from multiple suppliers adding up in a single order.

2. Negotiate with your dropshipper

Once you have been working with your dropshipper for a while, try to negotiate lower dropship fees.  This works best if you have a fairly high or steady volume of sales.  Once you have proven your value as a retailer to the drosphipper, they are often amenable to lowering their dropship fees or giving you a slightly better price on their products.

3. Get cheap or free packing materials

As I’ve mentioned in previous blogs, an excellent way to keep shipping costs low is to find cheap or free packing materials.  The cost of padding and boxes can really add up.  Get free boxes by visiting gift shops, electronics stores, and kitchenware stores when they are unpacking their new stock – they will often allow you to take their packing materials and boxes for free.  You can also get free shipping materials by using services like USPS Priority Mail.

4. Use envelopes whenever possible

When shipping, weight is everything, so you want to keep the weight as low as possible.  One way to do this is to use padded envelopes instead of boxes.  Obviously you wouldn’t want to do this with anything fragile, but it works perfectly well for items like clothing, CDs, etc.

5. Negotiate discounts with your shipper

When shipping through FedEx, UPS, etc., you can work with an account representative to set up a discount program or bulk shipping price.  Many of these providers will offer an incentive if you do all your shipping through them, or if you ship a particular number of packages per month (these are called threshold or earned discounts).

6. Offer alternative shipping methods

Not everyone cares about getting their package quickly.  Whenever possible, offer a cheaper and a more elite shipping option so your customer can make the decision.

Shipping FAQs:

The following are questions that e-tail newbies ask about shipping:

1. Should I inflate my shipping prices to make some extra money?

It’s no secret that some eBay sellers and e-tailers inflate their shipping costs to pad their profit margins.  However, as online shoppers become more savvy, this can lose you a lot of business and garner negative feedback.  Most buyers have a pretty good idea of what shipping should cost for a particular item.  If you are intent on making a little extra money this way, make sure you are at least reasonable about it.  For instance, if you are selling baseball cards, you can charge $2.99 for shipping, then send them in an oversized envelope for $1.00.  But don’t get greedy and start charging $7.99 to ship a baseball card – no one is going to believe that is reasonable.

2. Should I offer free shipping?

Free shipping is a significant draw for most customers, and hence a very effective marketing tool.  However, it doesn’t work on everybody.  Some people would rather the intial cost of the item be lower.  So there are two schools of thought here: keep your prices as low as possible, or inflate them a little and give your customers the peace of mind of free shipping.  I would say when you are selling items that can be shipped cheaply, say for around $3, offer free shipping and boost the price of the item by $3.  But when you are selling items where shipping is more expensive (say $5-$15), you better show your customers where that extra money is going.  You also have to consider the cost of the item vs. the cost of shipping.  If the item only costs $5 and shipping is $3, it’s better to show that shipping is being added.

3. Should I ship my item in the most secure way, even if it is way more expensive?

Again, there are two schools of thought on this issue.  Obviously the way to keep your shipping costs low is to send your package in the cheapest way possible.  Unfortuantely the cheapest shipping method usually doesn’t allow tracking and delivery confirmation.  This means that your item could be lost, or your customer could scam you by saying the item never showed up, when it really did.

Most professional sellers ship in the cheapest way possible so they attract the largest volume of sales.  Sometimes they lose money on a particular sale, if the item gets lost or the customer is dishonest.  However, this is usually made up for in the increased volume of sales that comes from having low shipping costs.  If your product is expensive, say over $100, you will definitley want to ship it in a secure, trackable, verifiable way.

online business, pricing and profits

How much capital does a person need to start an online business?  $100?  $10,000?  Obviously the answer is different for everybody, depending on your business goals and how many things you’re able to do on your own, but there are some common expenses that almost everyone has to shell out for.  There are cheaper and more expensive ways of setting up almost every aspect of your online business, but make no mistake, a business is an investment and it’s going to cost you something.  It might take you a couple of months to see a return on that investment, so don’t start an online business because you lost your job and you need to make rent or you want to buy a birthday present for your girlfriend next week.

What if I don’t have very much in savings?

It’s okay if you don’t have thousands of dollars stashed under your mattress.  You can look for less expensive options when setting up your online business, or you can seek additional funding from partners, bank loans, and lines of credit.

What are the costs of starting an online business?

The 8 main costs of starting an online business are as follows:

1. Education

Before you can start an online business you need to learn how to formulate business and marketing plans, how to choose a product, how to find suppliers, how to pick your venue, how to set up an effective website, how to market that website, and so on and so forth.  Perhaps your education will cost you no more than a library card.  Maybe you’ll get most of your information online, from a friend, or from a database.  Or maybe you’re a person who needs step-by-step encouragement and instruction and the best option for you is to hire a coaching service.

Learning how to operate an online business can cost you anywhere from $50 for a few good books to $5000 for a full-time coach.

2. Seller’s Permit and Tax ID Number (EIN)

It’s best to get your Seller’s Permit and Tax ID Number (EIN) as soon as possible.  You can get your Seller’s Permit either through one of the many companies offering their services online, or by downloading the form from your state Revenue Agency.  Your Tax ID Number can be obtained by applying online at the IRS website (you receive your number immediately and can download and print your confirmation notice).

Fees vary state by state, but it shouldn’t cost you more than $80 for the Reseller’s Permit, even if you use a service, and the EIN is free.

3. Finding suppliers

You can try finding suppliers online, but as anyone who has ever typed “golf club dropshippers” into a Google search can attest, you will have to wade through some 38, 700 results, 99% of which will be queries, middlemen, scams, foreign suppliers, and directories.  A second option is to attend tradeshows and other events to meet suppliers.  A third option is pay for access to a quality database.  The Wholesale Match database  offers affordable monthly and annual memberships, a Research Team to do the work for you, free educational materials, and a 100% money-back guarantee (probalby the only money-back guarantee you’ll find for an online service).

Finding suppliers will cost you approximately $200-500 for access to a database, or around $1500 for entrance fees, airfare, and hotel accommodation to attend a couple of tradeshows.

4. Products

You can handle your product sourcing in two main ways: by dropshipping or purchasing from a wholesaler.  If you decide to dropship, you won’t have to spend hardly any money upfront for your products.  There may be a small fee to set up an account with a dropshipper, but even this is uncommon.  When purchasing from a wholesaler, by contrast, you will probably have to make a large initial order.  (Subsequent orders may be much smaller).

The cost of purchasing products from a dropshipper is generally $0 upfront.  If you purchase from a wholesaler, your initial order may be anywhere from $50-$2000.  $100-$300 is most common. (Many wholesalers allow you to open a line of credit so you don’t actually have to pay any money upfront.)

5. EBay fees

Posting items on eBay occasions paying fees, whether or not your product sells.  Depending on the reserve price you set, posting a single item on eBay will cost you between $0.10 and $4.00 (adding extra photos, videos, etc. is extra).  You will also be charged a percentage of your final sale value, but that’s only if you make a sale, so that fee is really an operating cost, not a set up cost.  There are other auction sites you can use like Bonanzle which do not charge a fee unless your item sells, which is nice for e-commerce newbies, but these sites don’t always see the same traffic eBay does.  You should probably try selling on a few different auction sites and see what works best for you.

The cost of posting items on eBay is at least $0.10-$4.00 for one, or $1.00-$40.00 for your first ten.

6. Setting up a website

If you’re proficient at web design, setting up a site will cost you practically nothing.  Even if you’re not particularly computer-savvy, there are thousands of customizable templates you can use for your website (many are available free through hosting services).

If you do want to hire a professional, web-design will cost you between $500 for a student to $3000 for a seasoned pro.  You will also have to pay about $5-50 a month for web hosting, and between $10-100 to register your domain name.

7. Marketing

Once you have your website set up, you’re going to have to do something to bring in visitors.  The most common way to market a website is through Pay-Per-Click Advertising (PPC).  PPC can cost anywhere from $0.10-$1.00 per visitor – basically you bid for certain keywords, and whenever someone types that keyword into a search, your ad pops up at the top or side of the search engine response page.  PPC is nice because you can set a certain budget, say $300, and once that amount is exhausted your ad will disappear.

Of course there are many other ways of advertising your online business including banner ads and press releases.  You can even find free ways of promoting your business, such as contacting your local newspaper for a write-up, sticking an ad decal on your car, or participating in an advertising exchange.  But for now, let’s assume that PPC will be your main marketing method.

PPC will probably cost you around $200-500 per month for the first few months (once you start receiving organic traffic, you can cut down on your PPC ads).

8. SEO

SEO is Search Engine Optimization.  As mentioned above, the ultimate goal is to receive “organic” or “natural” traffic to your website.  This means that visitors naturally to your site due to your high placement in the search engine response pages (SERPs), recommendations and inbound links on other websites, and word of mouth.  SEO helps with your placement on the SERPS.  You build SEO mainly through keywords, quality content, inbound links, well-designed web pages, directory submissions, and deep submission.  SEO is something that needs to be done constantly and it can be quite complicated and time-consuming.  You can practice SEO yourself, but you may also want to hire a service to review the efficacy of your SEO or hire someone to do some of the work for you.

SEO can cost you nothing but your time, or can run you around $100 for a review, or $1000 + to pay somebody to help you out.

online business, pricing and profits

When choosing which product to sell online, you’re going to consider a number of factors including:

1. Is there a reliable dropshipper or wholesaler available for this product?

2. Is the market saturated?

3. Is there a demand for this product?

4. Do I have enough knowledge or can I learn enough about this product to write valuable product-related content for my website?

You might end up having four or five potential products that meet all these criteria.  How will you choose which one to sell?  Profitability may be your deciding factor.

How can you calculate the profitability of potential products?

A spreadsheet is generally the most efficient and effective way.  Remember, as will any spreadsheet your results are only as accurate as the data that you enter.

Below is an example spreadsheet for calculating the profitability of three potential products: jeweled sandals, corporate gift baskets, and fishing poles.  I’m assuming that all three products are being supplied by dropshippers and the only variable costs are the purchase price of the product and the dropship fees.

As you can see, the most expensive item is not always the most profitable.  In this case the medium-priced item, the corporate gift basket, is actually the most profitable.  Assuming you can sell an equal amount of each product, the corporate gift basket is the one you should sell.  Maybe you would have preferred to sell sandals because they’re more fun, but remember, you’re starting an online business to make money.  If selling toilet seats will pay for your BMW, then that’s what you should sell.

pricing and profits, product research, selling products online

When deciding whether you should purchase products from a dropshipper versus a wholesaler, there are many factors you’ll have to consider, such as the quality of each type of supplier available for your product, your commitment to that product, and your capital, which may or may not allow you to make large initial orders.  One of the most important factors you’ll consider is profitability.

It is usually more profitable to purchase products wholesale.  Generally you can purchase wholesale  for around 50% retail price, while the average dropshipper’s price is around 75% of retail.  However, when wholesaling you have to consider the cost of storing, packaging, and shipping the product yourself.  These are expenses that cut into your profits, as is the time you spend taping boxes, driving to the post office, etc., since this time has a monetary value.  Thus, depending on the exact price you’re getting your products for, wholesaling isn’t always more profitable than dropshipping.

For this reason, when you have potential suppliers, potential products, and potential supply-chain options, you should create a chart to ensure you’re making the best decisions.  Obviously, the chart is only as valid as the numbers you punch in, so make sure your figures are as accurate as possible.

Below is an example chart calculating the relative profitability of selling the same two products from a wholesale supplier vs. a dropship supplier.  The potential products are sleeping bags and juicers.  As you can see, it would be more profitable to purchase the sleeping bags wholesale.  Conversely, due to expensive packing materials and shipping fees, one would actually lose money buying and selling the juicers wholesale, so dropshipping is the better option.  I’m assuming that my fictional entrepreneur is storing the items in their garage or basement, so there are no storage costs listed.

Dropshipping Vs. Wholesaling Profitability Chart

dropshipping, pricing and profits, wholesale

Due to the popularity of the blog I posted on Thursday (”Products You Can Sell Online For A Profit”), I am adding a second installment.  Again, these products can be sold online via dropship or wholesale for a profit, but ONLY if you have a good supplier, sufficient profit margin, strong marketing, and so on and so forth.  They are NOT foolproof: online sales never are.

Period Clothing: I don’t know if you’ve ever been to a Pirate Festival, but I have, and it was quite surprising how natural saying “Yar!” and gnawing on a drumstick can feel under the right circumstances.  For all the freaks like me, there are a plethora of Medieval, Civil War, and Pioneer festivals for which the proper attire is necessary.  Besides the hobbyists, period clothing sells well for costume parties, Halloween, and even brides looking for a unique wedding dress.  Period clothing is a good three steps above the trashy nylon costumes you usually see online, and it has a price structure to match with a nice profit margin.

photo credit: eschipul

Eco-Friendly / Green Products: You always want to enter expanding markets, and though you’d hardly be getting in on the ground floor with green products, I believe the market will continue to grow.  From steel water bottles to canvas shopping bags to bamboo t-shirts to water-saving shower heads, people are switching to planet-friendly products.  Plus, granola geniuses are always inventing new products, so if you watch the trends, you can be the first to supply the new sea-grass wallpaper.

Police/Combat Gear: I don’t know who’s buying pepper spray, handcuffs, riot gear, and bullet-proof vests online, and I don’t want to know, but there’s a market for these products, and resale is inexplicably free and unrestricted.

photo credit: Izzard
photo credit: banspy

Scouting Supplies: In the last blog I mentioned camping equipment as a possible option, but that market is pretty full, so your best bet is to do something to differentiate yourself.  Setting up a website for scouting gear, 1st time campers, or birdwatchers is a good way to set yourself apart from the pack.

Erotic Materials: So many sex-toy sites are linked to porn and carry an indiscriminate product line.  I think there’s a relatively unexplored market for monogamous couples looking for a classy site to spice up their sex life.  High-end lingerie, massage oils, and tasteful accessories would sell well to this demographic.

Other Product Ideas:

Belt buckles
Funny t-shirts
Sports collectibles (due to licensing restrictions, these can only be resold among the 50 States and must be bought from a licensed dealer)
72-hour/emergency preparedness/apocalypse products
Western clothing/rustic home décor
Skateboarding gear
Maternity clothing
Action figures
Models/diecast vehicles
Easter/church hats and suits
Gardening products (especially seeds)
Motivational/inspirational products
Snorkling products
First-aid kits
Clocks (especially unusual/niche clocks like cuckoo or grandfather)
Premium coffee (ground and beans)
Plus-size clothing
Belly dancing costumes
Hunting/fishing gear
Luxury sheets/bedding
Puzzles
Wallets
Candles
Dive watches/pedometers/hear-rate monitors
Breast pumps/blood-pressure cuffs/diabetic equipment
Birdfeeders/butterfly feeders
Skincare products
Natural cleaning products
Non-perscription reading glasses
Funky retainer holders
Bonsai products
Martial arts equipment
Vitamins/supplements
Chess sets
Inflatable pool toys

More Products That Are Probably A Bad Idea:

Car parts: Besides the weight and bulk of car parts, there are very few dropshippers available; most manufacturers will only supply to body shops and retailers with a brick-and-mortar establishment.  A better option is to sell car accessories like dashboard ornaments, seat covers, license plate covers, etc.

Books / Textbooks: Textbooks sales are extremely restricted, and books are tricky too.  Most of the books available for wholesale or dropship to small websites are overstock or returned books.  That means they didn’t sell in stores, so the likelihood of you being able to sell them for a handsome profit is slim.  It’s possible that you can sell hobby books, especially if your focus is, say, cookbooks on your kitchen-products website.  But in general I wouldn’t count on books as a great seller, especially as the Kindle and e-books become ever more popular.

photo credit: Whatsername?

Swimsuits: I would stay away from high-return items.  And what’s more likely to get returned than swimsuits?  Their fit is extremely variable, as are the expectations of your customers.  You especially want to avoid returns if you’re dropshipping, because your middle-man status makes things sticky during the back and forth process.

Electronics: I’m not going to tell you to stay away from electronics entirely, because it’s one of the biggest sellers on the internet, but be very, very careful.  The market is saturated and many of the items are sold at a small profit margin.  You can sell cheap Asian imports, but most people are looking for brand-name products, and companies like Apple and Dell do not dropship.  You can sell brand-name electronics bought from retailers on eBay, (like with the Daily Deals / $200 A Day Program), and this is a legitimate way to make money, but it’s tricky.  Because retailers don’t like you reselling their products, they’re less than co-operative and the margins on this type of sale fluctuate rapidly.  I recommend a few small sales to get the feel of it before you try to re-sell a $900 flat-screen TV.

Salon Products and Other Restricted Items: Many products are only sold to retailers with a specific kind of brick-and-mortar store or a particular license.  Many salon products are only sold to salons (high-end straighteners and some cosmetic lines, for instance).  Dental implants and equipment are only sold to dentists.  Bowling equipment is only sold to pro-shops (by the manufacturers – you can sometimes purchase it via a distributor, though your profit margin is smaller).  Many brand-names restrict their resale to protect the elite status of their product or maintain the sales volumes of their current resellers.  When choosing a product to sell online you have to be flexible, because certain products simply won’t be available to you.

As always, the information in the blogs is my own opinions and ideas.  You can take or leave my advice, and if you make a million dollars dropshipping swimsuits, well, then I’m happy for you!

Product Ideas, make money online, pricing and profits, product research, selling products online

One of the first and most important steps in setting up an online business is choosing what products you’re going to sell.  But if you need help deciding, nobody will give you a straight answer.  If you Google “choosing products to sell online” or “what products should I sell online?”, you’re going to get back a bunch of articles on the selection process.  “Don’t choose anything fragile or heavy to ship, don’t enter a market that’s too saturated, try to sell something you’re knowledgeable about”.  All valid advice, but not very specific.  For some reason, everybody is afraid to give specific product ideas.  Well, I’m not.  I know how frustrating it can be when you’re stumped for ideas, so I’m going to throw some at you.  Keep in mind, your success at selling any of these products is going to depend on your personal decisions: how you set up your website or eBay store, how you market your product, which suppliers you buy from, and so on and so forth.  These are just some ideas to get you started, and some caveats for each particular category.

Arts and Crafts Supplies: This is a big market, and extremely varied.  You’ve got craft kits for kids, quilting supplies for the avid sewer, oil paints and brushes for the true artiste, jewelry and beading supplies, leatherworking, airbrushing, and a hundred other categories.  I would recommend selecting one niche, say, scrapbooking supplies, and focusing on that.  The nice thing about arts and crafts is, like any hobby, there are people who are willing to pay a premium for that Santa Clause-shaped hole-punch they couldn’t find anywhere else, or that luxury silk thread.  But you have to be careful that the price of the item won’t be overshadowed by the shipping charge.  If you do go the scrapbooking route, you would want to sell expensive items like albums and paper-cutters individually, but paper and ribbons only in packs or kits (say 50 or 100 sheets of paper).

photo credit: gabyalcantara

Christian/Religious products: A religious products website is one of those sites where you can take practically any product, customize it a little, and sell it as your own individual product.  For instance, there are a ton of dropshippers and wholesalers who provide printed t-shirts, monogrammed jewelry, and customizable mugs, license plates, belt buckles, and the like.  Besides selling the various religious books, music, jewelry, t-shirts, pictures, and cards that already exist, you can get your own products made with funny or inspirational religious images and sayings stamped on them.  Religion is part of many people’s identities, and they like to display it on their personal objects.  While the Christian market is large, it already has quite a few players; the Jewish, Buddhist, Muslim, Hindi, etc., markets are less well-represented on the internet.

Spa/Relaxation products: This is one of those product niches that falls in the “gifts” category, which means you can group products into gift packs and instigate effective  holiday promotions.  The other thing I like about spa products is that there are a lot of lesser-known product lines you can purchase directly from the manufacturer.  They’re great products: all natural/organic/shea butter/smell like candy/etc., just not quite as well known as Bath and Bodyworks (not yet anyway).

photo credit: kafka4prez

Nutrition/Health/Fitness products: People will always want to get thinner, healthier, and live forever.  Nutritional/health/fitness products are in high demand, and while many parts of the market are saturated, there are always new trends you can capitalize on.  Also, like so many of the products on my list, they lend themselves to blogs, tips, and articles that bring people into your site.

Toys: Toys are another category with an unexpected number of niches.  Porcelain dolls, plush toys, vintage-style ride-on cars, board games, educational toys, science kits, models… the possibilities are endless.  Because it’s difficult to compete with Walmart and Toys ‘R Us, I would recommend sticking to higher-end, unusual items, things you can’t buy at the mall.  The ride-on toys are a great example: shaped like classic cars, 1920s airplanes, trains, firetrucks, and motorcycles, they’re expensive with a solid profit margin, and they have the kind of adult-appeal that will convince Dad to pull out his wallet in a fit of nostalgia for his first Mustang.  Remember, parents will buy what their kids like, but ultimately it’s the adults’ money.  You have to touch them as well as the kids.

Jewelry: In many ways jewelry exemplifies the qualities you want in an online product: high demand, easy to ship, and expensive relative to its size and weight.  However, people have a strange compunction about buying jewelry online.  Often the actual physical appearance of the item is what sells them while browsing through the jewelry store.  Particularly for items like engagement rings, people are extremely leery to buy what they haven’t seen with their own eyes.  Also, the more expensive the item is, the more developed your image of security needs to be.  If I was going to sell jewelry online, I would cultivate an image of class, prestige, and reliability on my website.  I would make sure I had fantastic images that really showed off the products.  And I would stay away from extremely expensive items, at least to begin with, focusing on items in the $50-$300 range that people wouldn’t be afraid to buy from a new site.

Baby Products: Because the baby market is very competitive, I would pick a particular niche in baby products: organic baby clothing, baby Halloween costumes, slings and carriers, bedding, baby shoes or hair-bands, something like that.  Like any popular market, you need to know exactly what your selling position is.  Are your baby items totally unique and unusual, the cheapest or most high-end, do they appeal to Granola Moms or Technophiles?  The way to succeed in a competitive environment is to know exactly who you’re targeting and cut your customers away from the middle-of-the-road, trying-to-appeal-to-everyone websites.

Poker/Darts/Billiards: As long as beer exists, the appeal of poker, darts, and billiards will reign undiminished.  In fact, poker has become increasingly popular since the World Series went celebrity.  I wouldn’t try to go too high-end since these products are essentially games, but you could consider getting funky with poker chips printed with your pet’s face and dart boards adorned with your ex’s image.

Theme Products: Whatever strange fascination you have, there are probably hundreds of other people who share it and would absolutely love to find a website devoted exclusively to it.  Fairies, dragons, butterflies, Smurfs, Panda bears, Monster trucks, aliens, Barak Obama… Build a website with everything Hawaiian, (pajamas, dishes, t-shirts, tea sets, socks, backpacks, cellphone cases, aprons, car seat-covers, lotion, bathing-suits, posters), and watch your fellow Oahu-lovers line up to buy.  This works best if other websites carry Hawaiian-themed products (the demand is there), but you are the only one with a site devoted exclusively to the theme.

photo credit: metaldoll [is catching up]
photo credit: PedroCancion

Those are a few examples to get you going.  Here’s some more:

Kitchen supplies
Sports gear
Nursing scrubs
Camping gear
Motorcycle apparel
Holiday-themed decorations
Hemp/Bamboo products
Dance shoes
Mineral makeup
Wedding favors
Gift baskets
Solar products
First-aid kits
Special-needs products
Raincoats
Lunchboxes
Massage oil
Posters
Hair accessories

I could go on and on.  I don’t think any of these products are superior to the others; I think you could succeed or fail in almost any category.  The purpose of this list is purely to give you some ideas, to get the juices flowing.

Things that seem like a good idea that I would stay away from:

DVDs/CDs: The world is becoming more and more digital.  My husband and I recently copied all our DVDs onto our hard drive and threw away the discs and cases.  With the growing popularity of Apple TV and movies, Netflix, and similar digital media sites, I would caution against setting your business up around a declining market.  Licensing restrictions have always made selling these products complicated anyway.  If I was going to sell CDs or DVDs, I would stick to a niche market like Family Movies or Japanese Anime.

Pet Food/Bed/Crates, etc.: Pet products are a big seller online, but you have to stay away from the bulky, heavy stuff.  If you’re going to be successful in the pet market, you need to stick to the quirky and unique (think dog tuxedos, fancy bowls, cute toys) and the light/easy to ship.  There is so much competition even among the niche products like all-natural/organic dog food, that you probably won’t be able to compete unless your doggie booties and gourmet biscuits are significantly different from what everyone else is carrying.

photo credit: Colure
photo credit: Alan Miles NYC

Furniture/Appliances: Again, too heavy to be tenable.  I wouldn’t bother with large appliances at all, and I would only get into furniture if it was the extremely high-end stuff.  For instance, I know this one supplier of patio furniture who carries the most gorgeous patio furniture I’ve ever seen: wicker tables that seem to float, bamboo chairs that look like the throne of Confucius.  If I was rich, I would buy that furniture in a second, and darn the cost of shipping it.  But keep in mind, when you go high-end, your website and service have to match your price point.  This may entail a larger outlay in web design and a larger credit limit with your supplier.  High-end may not be in your reach right when you’re starting out in e-commerce.

If you would like feedback on your product ideas, please feel free to email our customer service division at support@wholesalematch.com or post at the bottom of the blog.

Product Ideas, dropshipping, pricing and profits, product research, selling products online

There are definitely pluses and minuses to using an international dropshipper or wholesaler.  Sometimes the latter outweigh the former.  But other times, with certain products, you have to be a little more adventurous in order to make a sustainable profit margin.  Really, it all comes down to how risk-averse you are.  If you want a stress-free business experience, an international supplier is probably not for you.  If you don’t mind taking a little risk for the possibility of greater reward, than an international supplier might be just what you’re looking for.

First: The Benefits. Using a dropshipper or wholesaler based somewhere like China or Thailand is likely to get you a product about as cheap as possible, which will often off-set the increased shipping costs and allow for a larger profit margin than with an American supplier.  A second benefit of international suppliers is that probably very few other Americans are using the same dropshipper or wholesaler, so you won’t be competing with other websites selling the exact same products.  International suppliers also provide products that are rare or impossible to get in the States, like authentic ethnic items and imitation products.  Finally, most Asian-based dropshippers are extremely anxious to build relationships with US-based sellers, in sharp contrast to some persnickety domestic suppliers.  Thus, they are usually very accomodating.

photo credit: ajagendorf25

Second: The Negatives. Selling with an international supplier is a lot more chancy.  Your experience will be as good as the supplier is, and it’s hard to tell ahead of time how reliable and sophisticated a foreign company is.  The main issues are the language barrier and possible customs/shipping hassles.  Also, the quality and consistency of the product is not always on par with American companies.  For instance, one of my associates makes a lot of money buying clothing from an Asian company and selling it on eBay.  She buys around 5-10 items of clothing at a time.  The items are good quality, but the sizes vary drastically.  She’ll buy two Smalls, and one will be tiny and the other quite large.  This isn’t a problem, because she simply posts them as Small and Large on eBay, but it could be a problem if you are dropshipping the item directly to your customer.  Also, some customers are annoyed when they purchase from an American company and the product arrives from Asia.  Many international suppliers provide blind dropshipping, but you have to check with the company as to exactly what this entails (for instance, sometimes a packing slip is still included).

How To Make It Work: The number one thing you have to do is strenuously research your potential international supplier.  The major players will be reviewed on sites like Dropship Forum (dropshipforum.co.uk) and Rateitall.com.  Here you’ll discover if other retailers have had negative experiences with the dropshipper you’re considering.

When you do contact an international supplier, have a list of questions ready and make sure you get them all answered – when dealing with a language barrier, it’s easy to get off track and neglect to have all questions answered fully.

You’ll want to cover the following bases:

1.Shipping Policy: Shipping is extremely important – even though you warn customers that shipping may take up to 2 weeks, they may get annoyed waiting and, if you’re selling on eBay, blast your rating.  If an international company can’t stick to a strict shipping schedule, ditch them and find somebody else.  Asian dropshippers are aware of this issue, and many companies now offer next-day processing to expedite shipping as much as possible, but it will still probably take about 10 days.  Check exactly how items are shipped, (blind or not blind), and how long it will take (the company should use reliable services like UPS, DHL, FedEx, etc.).
2.Fees: You will want to check if there are any fees associated with their service (order fees, monthly fees, etc.), and whether there is a minimum quantity of products you have to buy in order to get the best price.
3.Refund/exchange policies: When dealing with an international supplier, a 12 month guarantee is desirable and not unreasonable.  You’ll want to know if the company handles refunds and customer complaints themselves.  (You may want them to deal with it for your convenience, but keep in mind this will tip off your customer as to the real supplier of the product, and they quality of the customer care may be sketchy).
4.Quality Control: You are well in your rights to ask about the supplier’s quality control.  Ask how they maintain quality at the factory level and at the warehouse.
5.Promotional Materials: Will they furnish product descriptions, photos, etc.?
6.Catalog Updates: Make sure they update their catalog regularly so you’re not selling items they don’t actually have – they should email you if they run out of stock on anything.
7.Payment: Most dropshippers and wholesalers in China only accept payment by Western Union or wire transfer (really, this is all they can do – credit cards are under government restriction in China).  This method is not always secure – make sure the account is used solely for these kinds of payments.  Also, be aware of the cost of this kind of transfer – it can be as high as $15.  To protect yourself further, use an escrow service so they can’t take the money out until the product has arrived.
8.Samples and Tests. Quality companies which usually send you a sample order so you can test the quality of the product.  If not, order something yourself so you can get a run-through of the ordering, shipping, receiving process before you start using it on customers.  (Note: A lot of Asian companies ship all their products as “samples” since this avoids customs hassles if the quantity is a dozen or less.  Obviously this is not honest, but it is common).

Be Aware: Brand-name products from China are 99.99% guaranteed knock-offs/fakes/replicas, whether the company acknowledges it or not.  Some are made to look exactly like the real thing, while others are sold as unbranded alternatives- a phone that looks very much like an iPhone, for instance.  If you are purchasing a brand-name product from China, assume it is fake.

photo credit: simonlesleyphoto
photo credit: Davvyk

Some common products dropshipped from Asia include: computers, computer components, cell phones, mp3 players, lingerie, clothing, jewelry, watches, handbags, shoes, pet products, and electronics accessories of all kinds.

There are a lot of people who make money using international dropshippers and wholesalers, but there are others who have had obnoxious experiences and ultimately failed.  I would recommend reading the message boards to get some real-life examples of the kind of issues you might come up against (just Google “Using Chinese Dropshippers” and you should find some examples).

In my mind, the risk might just be worth it: I don’t mind a little drama if the profit is there.  Only you know how much excitement you can stand.  If you do use an Asian supplier, you’ll have to exercise your due diligence even more than with a regular dropshipper or wholesaler.  If you are interested in checking out international suppliers, simply specify your interest in your Research Request to the Wholesale Match Research Team.

dropshippers, finding suppliers, pricing and profits, wholesale

There are a plethora of tools available on the internet to help with market research and sales tactics.  One of my favorite new tools for eBay is Auction Touch. This is not a free service, you have to pay for a membership, but for people who sell or plan to sell a lot of products on eBay, I think it’s well worth the investment.  It helps you determine what the best days are to sell a product, which keywords are most searched for, and what the optimum list format is.  This kind of market research is imperative if you want to get your products sold, but it can be extremely time consuming.  And, as I always say, your time really is money.  Time you waste researching and clicking is time you are NOT making money.
How does it work?

photo credit: jimmyroq
Step One: You decide what product you’re interested in selling. Let’s say it’s an item off the Wholesale Match Daily Deals page, say the Samsung 2033SW 20” Widescreen Flat Panel TV.  The Daily Deals price is $87 after a $61 instant discount, $20 rebate, and $12 coupon discount.  This flat panel comes with free shipping and an additional 2% discount if you pay by credit card.  You’ve already determined that price is lower than the average selling prices on eBay (doing an advanced search through eBay’s website), so you know you want to sell it.  The question is, HOW do you sell it?  “Well”, you might say, “You just go and post it on eBay”.  Wrong!  There are multiple factors that determine whether your TV will sell, and for how much.  Using Auction Touch, you can figure out exactly how to maximize your chance of success.
Step Two: You head over to the Auction Touch site, copy and paste the product information in the search bar, and hit Research. (You can be as specific or as vague with product information as you like – you could type in “Barbie” and it will give you various options, or you could type in “Handmade Barbie Clothes” and get a more specific answer).
After you hit Research, your results pop up in a simple chart.  The chart will inform you that you should sell the TV on Monday, that your sales period should only be one day, and that you should use the keywords “lcd” and “hdtv”.  The best time of the day to post it is actually between 4-5 in the morning, and you should use a “Bid Auction” format.  You should post it in the “Television” category and use the listing upgrade “Picture Services”.  This simple list could save you making a multitude of mistakes, and significantly increase your profit margin.
Step Three: If you want to be even more in-depth with your research, you can use the advanced options. These allow you to enter a starting and ending price range to narrow your results to auctions that started and/or ended in the same price range as you hope to get for the TV.  You can search using specific listing upgrades and, if your schedule is constricted, search within certain times of the day.

photo credit: kevinzhengli

You can also examine the data generated in the course of the search.  You don’t have to simply take Auction Touch’s word that you should post the TV on Monday: by clicking on the “Day of the Week” result button, you can review the chart it generated.  You can see for yourself that 38.61% of comparable TVs posted sold on Monday, and you can see that Sunday and Wednesday were a close second place.

In less than 2 minutes you have information it would take you hours to figure out on your own, if you could calculate it accurately at all.  The whole idea with online business is to work smart.  There are excellent tools to help you with nearly every step of e-business, especially selling on eBay.  Don’t just shoot blindly into the dark.  Do your research, and ensure your success.

eBay, internet marketing, pricing and profits, product research

As discussed in previous posts, one of the main differences between dropshipping and wholesaling is that dropshippers will ship products for you, while wholesaling usually requires you to carry and inventory and ship products yourself.  Whichever method you’re using, you may have noticed that shipping costs take a hefty bite out of your profit margin.  So how can you conquer shipping costs?
#1: Use A Cheaper Method. When dropshipping, you don’t always have options as to how the product will be shipped.  If you do have that option, or if you are controlling the shipping process yourself, than you can send your product the cheapest way possible.  The caveat with this tack is that the products will likely not arrive as quickly, and you probably won’t be able to track them.  You have to consider the profit you’ll lose when you have to replace lost product.  You are also more susceptible to customer theft when customers do not have to sign for receipt of their product.  Using UPS or FedEx may actually save you money in the long run in security of product and customer satisfaction.

photo credit: cliff1066
#2: Sell In Bundles. Bundling products together can be a great way to sell multiple items and also attract and impress customers.  People love to buy gift baskets and value packs, and if they feel that the price of the pack is acceptable, they are not likely to actually calculate what each item is being sold for.  You can make a gift basket for almost any kind of product.  Camping accessories (freeze-dried dinners, a Coleman lantern, a pocket knife, army blanket, mosquito repellant, and fishing lures – sell it for Father’s Day!), baby shower baskets, pamper-yourself packages, the super nerd’s gift bag, gift basket for the Mother-in-law who has everything… the possibilities are endless.  Bundling is especially important with small items that usually are unsellable due to high shipping costs.

photo credit: swanksalot
photo credit: mothernaturebeauty
#3: Evaluate Your Free Shipping Carefully. Shipping costs are the #1 concern of online shoppers, so keeping your shipping low or incorporating it into the price of your products is important.  Offering “free shipping” and simply raising the price of your product to cover it is a viable option, though it may lose you customers who simply compare prices without considering shipping costs.  However, if you do decide to go the “free shipping” route, make sure you have a minimum purchase volume to qualify, or only offer free shipping on items with a profit margin to justify it.  For example, don’t offer free shipping on a pack of napkins if you’re selling them for $1.25 and shipping is going to run you $3.50.  If you want all shipping to be free on your dropshipping website, you can also set it up so that small, cheap items are only offered as an add-on with more expensive purchases.  Or you can have these small items show up as a bonus.  People love free stuff, even if it’s only a stupid little rattle with their purchase of a crib, stroller, and carseat.  Bonus items can be a great promotional tool, and usually add little or no shipping costs.

photo credit: SDCDeaCerte
photo credit: kona99
#4: Consider Shipping When Choosing Between Dropshipping and Wholesaling. The choice between dropshipping and wholesaling may end up depending almost entirely on the shipping costs of your desired product.  Before you jump into bed with a particular dropshipper, the very first thing you should check is their shipping costs.  Shipping charges are often the way that suppliers who offer dropshipping pad their profit margin and make the extra hassle worth their while.  But that extra profit is coming out of your pocket, so try to negotiate for a better rate or go somewhere else if the price is unreasonable.  You could also consider dropshipping most of your products, but carrying an inventory of certain small items that would be too expensive to ship otherwise.

dropshipping, pricing and profits, selling products online, wholesale