Drop ship? - WarmGlass.com

Drop ship?

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Patricia O'Neill
Posts: 43
Joined: Sun Mar 09, 2003 8:24 pm
Location: Arizona

Drop ship?

Postby Patricia O'Neill » Thu Sep 11, 2003 11:25 am

For the second time someone asking to start a wholesale account with me asked me also if I "drop ship".

After searching on the internet, I understand it means that I will ship directly to their customer. Am I correct?

If this is the case, I don't like that very much. For another reason, I denied the application of the first person and I am wondering what I should do with this new one....

What could be the advantages and/or inconvenience to accept to drop ship? If someone has some experience to share I will appreciate.

Thank you in advance,
Patricia

charlie
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Postby charlie » Thu Sep 11, 2003 11:36 am

most things ordered over the internet are drop shipped, as most large companies don't keep warehouses filled with stuff. it does mean that it is shipped from the manufacturer directly to the customer without stopping at the middleman. it's cheaper for the middleman, as they don't have to double pay for shipping, pay for storage and insurance, and risk breakage (that risk is taken by the first shipper).

there really isn't any downside. you have to ship it somewhere, might as well ship it directly to the buyer rather than the middleman. you're actually risking less, as the items can get broken in the double transit that you may have to replace at wholesale anyway.

my company does this with large computer systems. the reseller just sends us the order and we manufacture and ship directly to end customers. we get to control how and who does the shipping, the packaging, and take the risk of damage.

you may be able to negotiate a larger cut for you from the middleman for doing this, as you're taking part of their risk. there's also the extra fee for the extra hassle of keeping track of multiple small customer orders rather than the one large one to the middleman.

Glenda Kronke
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drop ship

Postby Glenda Kronke » Thu Sep 11, 2003 12:17 pm

Patricia,

Depending on the type of items you make (one-of-a-kind vs. 'production' pieces) it can sometimes be a problem to drop ship.

Things to consider:
1) If your items are one-of-kind and the 'end user' has only seen a similar item and not the actual piece you are sending, you might end up with an unhappy customer (end user). "this isn't what I ordered"- then you have to deal with returns, etc. You are now dealing directly with the end user instead of the wholsaler.
2) Make sure if you do drop ship that you get a signature for receipt of the item.( i.e. UPS-adult signature required for delivery) otherwise the item will be dropped off at the address and someone can always claim 'I never received it' or it could 'walk off' and then you are left with having to replace the item with no compensation.
3) Claims for damaged items are always harder to collect on when you don't have a relationship with the person you are sending it to....the 'end user' could claim it arrived damaged even if they accidently damaged it while unpacking. It is difficult to 'prove' who damaged the item. *You would have to make sure the end user kept all packing materials, then you would have to call the delivery company, have them go out and inspect the packaging and pick up the damaged piece, file a claim, etc and then HOPE that you get reimbursed. If you have a relationship with the wholesaler, and are only shipping to the same business address each time, this process becomes much easier. (The wholesaler deals with deliveries on a daily basis and knows the proper proceedures for reporting damage)
4) I understand the double shipping costs, but that IS part of a wholesalers operating expense. The time and energy it takes to deal with returns/dissatisfied customers/lost packages/proof of delivery, etc should be the responsibility of the wholesaler. Why let them make all the profit when YOU did all of the work?

Also, when do you get paid for the piece? Is your wholesaler on net 30 terms? Will they pay when they get proof of shipment or proof of delivery? or will they pre-pay?

*My expierence comes from being a manufacturer with multiple wholesale accounts. If you are not doing large volumes, this may not apply to your situation. I just wanted you to be aware that it may not seem like a big deal but it can turn into one.

I know Charlie has a different take on this and I can certainly see his point, just thought I would give a counter view and let you decide.

Good luck!
glenda

Patricia O'Neill
Posts: 43
Joined: Sun Mar 09, 2003 8:24 pm
Location: Arizona

Postby Patricia O'Neill » Thu Sep 11, 2003 2:23 pm

Thank you for your input.

In fact, I am not too excited to work with those people.
It seams it is only an online store. They have bunch of craft stuffs like teddy bears, garden sculptures in rusty metal, xmas ornaments, kitty cats stuffs, mooses pillows... arghhh
I don't know why they contacted me because this is not what I am doing (is it the moment where I feel deeply depressed?).

I am under the impression they will send me an order only when they will have one, will let me deal with everything and will still get wholesale prices. Good deal for them, not much of a good deal for me.

I do not want to see my glass next to the moose pillow but on another hand, I do not feel too comfortable refusing to sell to someone. Maybe I should?

I have standard policies covering minumum order, shipping costs, paiement, etc... I will forward them to the owner and stick to my guns. They contacted me, I did not contacted them, so I can enforce my policies and say I don't drop ship.

Thanks,
Patricia (who likes mooses but not moose pillows)

Kitty
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Joined: Sun Mar 09, 2003 4:12 pm
Location: Gig Harbor, WA

Postby Kitty » Fri Sep 12, 2003 1:21 am

that's a good point you made about the minimum order. depends i guess on how much your piece would sell for ... if it's high enough, maybe it's worth your time. if the company giving you the order is going to pay you your wholesale price, plus freight, and it's not a nightmare to pack, then why not try it and see what happens? up to you whether to charge additional money to pack the order ... i probably would not add anything else, just the true price of freight (and box, if you have to buy one).

nuts to the moosehead catfood dish to display in the garden.

Barbara Muth
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Postby Barbara Muth » Fri Sep 12, 2003 7:46 am

moosehead beer is nice..... :roll:
Barbara
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Barbara Cashman
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Postby Barbara Cashman » Fri Sep 12, 2003 7:02 pm

I have a policy that any shipment to my dealer's customer is prepaid by the dealer, including freight and handling. I got stuck once for $2000, because I didn't get the money up front. Never, never again....Barbara


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