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Are Drop Ship Directories Really Worth The Money? Here Is A Guide... |
by:
Brad Beiermann |
By Brad Beiermann Ph.D., Hienote Inc.
This question is often asked by many people hoping to start a new ecommerce site or simply adding to an existing one. The answer to the question can be simply answered with another question: How much is your time and online business worth to you? The more experienced ecommerce site owners will often ask the question a little differently: How do I find a useful, and legitimate, drop ship directory? The answer to this question is not immediately straight forward without doing a little homework. However, when you find a great directory, it can be worth the price of admission a thousand times over. So, in this article we are going to present a couple of important pieces of information that can help you answer some of these questions and guide you through the forest.
First, let's get on the same page together and define what a drop ship directory is supposed to do (or contain). These directories are supposed to contain the names and contact information for companies that drop ship their products to your customers for you. They offer you the lowest wholesale pricing. They are able to ship single quantity items to your customers. They do not require minimum orders and the drop shipper will not ask you to pay any association fees. The drop shippers in the directory are usually one of two types: 1) They are the manufacturer, or 2) They are an import distributor with a warehouse. So, these folks are a key business ingredient when it comes to supplying and shipping product to your customers without you carrying the inventory.
How hard can it be to actually find a drop shipper?
The best way to answer this question is to try and find one yourself. If you have actually tried this in the past, then you know this can be a very time consuming task that requires some research. This is particularly true if you are trying to find a specific niche of products the general public has not seen often. These products typically do very well on the Web with a niche type of ecommerce business. So, finding the wholesale supplier to drop ship the items can be a very time consuming challenge, and sometimes you might not find anyone. One of the biggest values a drop ship directory brings is the ability to save you all the time searching for a drop shipper. The time saved can let you concentrate on other parts of your business. Another value a directory can bring is the possibility of finding new product ideas for your business.
What should I be evaluating?
Let's now turn our attention towards what you should be looking for in a drop ship directory. The drop ship directory business has been plagued in the past by many scam artists. Today, there are still some directory scams out there, which is to be expected. Virtually any line of business has, or has had, it's share of scams. A little bit of education is key in spotting the real directory companies from the not so real directory companies. With a little bit of knowledge and a trained eye, you can spot them fairly easily. For purposes of this article, we are going to focus on evaluating a directory and the company offering it. Again, this should help guide you through the forest.
There are ten key parameters you should consider when considering a drop ship directory:
1. Balance - You want to find a directory rich in many different categories of products rather than the quantity of products available. Many of the directories try to advertise how many products are available in their directory (i.e. 500,000 products). Why is the number of categories important? A directory will not serve you well if it has hundreds of thousands of products, and none of them are in your product interest category. A directory with a good balance has focused on their categories of drop shipper products rather than the quantity. This gives you a better chance of finding something for your line of business.
2. Uniqueness - You will want a directory with uniqueness amongst its drop shippers. The drop shippers should offer a wide array of unique products that are not necessarily mass marketed. Why? Web sites offering unique and unusual products often do well on the Web versus sites trying to sell big brand name products that you can find with a mega retailer. A directory offering a bunch of big brand name product drop shippers could land you in the highly competitive commodity market against the mega retailers.
3. Selection - A directory with a good selection of drop ship categories is important. The number of drop shippers or the number of products a directory carries should not be the goal. The goal and question should be, "Do they have a drop shipper that would fit my line of business." A common mistake for many folks is getting fixated on the quantity of products a directory might offer with its drop shippers. The question they start to ask is, "A directory with over 700,000 products ought to have something for me to sell." Wrong! Be sure to remember the first parameter we mentioned. Balance.
4. Search Method - The directory must explain the methods they use to find drop shippers. Be careful of directories that do not publish their search methods. If they do not explain their search methods, they may not have a solid search methodology. The directory could be full of a bunch of middlemen. At that point, the directory would be worthless to you. Directories using search methods such as trade show searches and foreign government agency searches are preferred over directories only focused on Internet searches. Why? Not all drop shippers and importers have a Web presence. A directory based on a bunch of Web searches could be missing some of the best hard-to-find drop shippers.
5. Sample - A sample of the directory should be made available to give an idea of format and information provided. The actual names of the drop shippers will not be given in a sample, but you will get an understanding of the type of information provided.
6. Price - This is a subjective parameter but there is something to consider. As an observation, most legitimate directories on the Web today are sold between the $60 and $80 price mark without any markdown. If you find one good drop shipper in a directory and you sell their products on your site, you could find your directory investment paid off quickly with just a sale or two.
7. Education - The Company selling the directory should have a website fairly resourceful with FAQ’s and articles written by its own research staff or owner. Topics should include drop shipping, ecommerce, importing and general FAQ’s about drop shipping. Watch out for directory sites only containing FAQ’s about their directory and not drop shipping.
8. Custom Search - Find out if the company offering the directory will do a custom search for a drop shipped product. A custom search can sometimes be done under certain conditions with the directory's parent company. As of this writing, Hienote is the only directory company advertising this type of service.
9. Toll Free Number - You should be able to talk to the folk's offering the directory without paying for the call. Contact by email only is not acceptable! Also, be leery of directory sites without toll free numbers or only a cell phone number given as this could be a suspicious con artist.
10. Customer Service - Any online business that cares about its customers should have a section dedicated to customer service. A company that offers a drop ship directory is no exception. It should have a section of its site dedicated to customer service. At a minimum it should have a toll free number, mailing address (not just a P.O. Box number!), email address, hours of operation, money back guarantee, and a phone number for calls outside of the country.
With these ten parameters you should now have enough knowledge to get started in the right direction for evaluating a drop ship directory. In addition, hopefully this has given some food for thought in terms of considering a drop ship directory for your online business.
About the author:
About The Author:
Brad Beiermann Ph.D., is President of Hienote Inc., Crystal Lake, IL 60039. Dr. Beiermann is one of the leading experts in business technology and e-commerce. Hienote Inc. specializes in assisting businesses locate unique wholesale drop shipping companies. You can visit their site at www.hienote.comor call 1-800-342-0386.
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