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Top 7 Challenges of Running a Dropshipping Business and How to Overcome Them

April 20, 2021 eCommerce TipsEntrepreneurs

Dropshipping business seems like an easy way to do business online. You don’t have to invest a lot of capital or bother about meeting up with product orders. Besides, you can run the dropshipping business from wherever you are. However, just like every other business, dropshipping has its challenges as well.

In Dropshipping business, you are not totally in control of the business process, and you can’t influence the business outcome. Other agents control the order processing and packaging, which leaves you at the mercy of the agents. This is a leading problem with dropshipping business because when an order goes wrong, the business goes wrongs. The good news is that the challenges that come with dropshipping can be rectified. If you are considering starting a drop shipping online business, here are some challenges you may face and how to handle them.

Delayed Order Processing

It can become a problem when you place an order with your supplier, and he delays the order. You can handle this challenge by following up on the order if you don’t get feedback from your supplier after 24 hours. You need to know why your order hasn’t been processed and when it will be processed. This will increase customers’ trust level, especially if your business is still new.

Finding a Reputable Supplier

This is a leading challenge eCommerce store owners face. There are many suppliers out there, but it can be hard to get a consistent and reputable one that isn’t fraudulent. The best way to handle this challenge is to search for suppliers using dropshipping supplier catalogs. On this catalog, you will find a list for you to choose a supplier. Also, ensure that your supplier is someone who knows your niche and is on the same page with you in terms of supplier fees, scalability, and order minimums.

Shipping the Wrong Item to a Customer

Many online business owners have had this problem one time or the other. This problem indicates poor customer service, and it can tarnish your business’s reputation. Some eCommerce store owners have admitted that they lost customers because of this mistake. Regardless of how the business ends, the business owner takes the blame alone. As much as this mistake can leave a bad impression on your business, you can handle it and reduce the negative impression.

You can avoid this problem by knowing your drop shopper return policies. This will help you guide the customer on the action to take when the issue arises. You can also give the customer a discount on their next purchase as a way of apologizing to them.

Goods Out of Stock

This is a common challenge with dropshipping business. Most manufacturers and processing agents try as much as possible to update their eCommerce partners about available stocks, but at times the goods may be out of stock or no longer available.

You can overcome this challenge in several ways. You can inform your client. Contacting them through personal channels like a phone call works better in this case. Customers prefer being contacted personally about their orders. You can also suggest to your customer of you can deliver a similar product. Another way you can overcome this challenge is to get the product from another supplier.

Wrong Tracking Code

Wrong tracking code can be for another package, or it can be invalid. Human errors can happen sometimes, especially when your dropshipping company gives out a high number of tracking codes daily.  Handling this challenge is simple. The best way to deal with this minor challenge is to test-track the code before passing it to the customer.

Damaged Arrived Goods

You might get confused about what action to take when goods arrive in poor conditions. You shouldn’t worry yourself much about this problem because it’s not so difficult. The best and easiest way to handle damaged arrived goods is to replace them. Most times, manufacturers give warranties on products. When this happens, you only have to contact the manufacturer to replace the item. However, you should know the terms and conditions of the manufacturer before getting involved with the product.

Goods Shipped to the Wrong Address

Sometimes goods are shipped to invalid or wrong addresses. This happens especially when there are errors with the communication channels. Suppliers handle orders differently. While some prefer using emails, others will opt for a phone call. With a phone call, it’s easier to mix things up. Regardless you can avoid this problem by cross-checking every address before you send it to your supplier. Also, have proof of the shipping address. You won’t have to bear the cost of reshipping the product if the problem isn’t from you.

Endnote

In Dropshipping business, problems are bound to arise because you are not in complete control of the process and outcome of the business. If you are interested in dropshipping business, don’t let the problems discourage you. The challenges may seem tough, but they are easy to handle.

Are you considering starting a dropshipping business? Contact us today at Fulfillman to know more about the services. Our dedicated team will be available to speak with you and discuss your possible dropshipping options. Our experts will provide suitable answers to your questions and concerns. We guarantee you excellent services.

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7 Common Dropshipping Challenges and How to Overcome

October 30, 2020 eCommerce TipsEntrepreneurs

Dropshiping is unarguably one of the most remarkable things that have resulted from the internet and our new way of life. It is a new business model that allows smart entrepreneurs to take to ecommerce with little resources and still make headways. While the benefits are enormous, dropshipping has inherent challenges. As entrepreneurs, dropshippers are expected to handle the challenges that come with the business model. Here, we will discuss seven of the commonest challenges associated with dropshipping and how you can overcome them:

Supplier Challenge

The first major challenge most people face in dropshipping is the challenge of finding reputable suppliers. There are so many producers and sourcing agencies that can serve as your suppliers, but you need to be on the same page with them on the details of the relationship. You need to find reputable suppliers that can be consistent with the quality of their suppliers.

It is somewhat easy to find suppliers in almost any niche you choose. There are numerous resources that can help you with the search. Just make sure you choose a supplier that can meet your needs. Consider such factors as supplier fees, order minimums, expert industry knowledge, and scalability.

Running Out Of Stock

This can happen when you are already in business. It is one of the commonest problems and is more prevalent in certain seasons. This challenge also affects businesses that have only one supplier most. You may not experience the full consequences of running out of stock if you are working with a very big producer and order Fulfilment Company. When you run out of stock, it is important that you inform your customers as early as possible, even as you find alternative means of fulfilling their orders. Having more than one supplier is advisable.

Delay with Order Processing

When customers buy something from your ecommerce website, they expect their order to be processed as soon as possible. Most customers don’t understand that the speed of processing the order, most of the time, is not in your power. There are instances you will experience delay with an order you have already placed with your producer. Such delay may create some sort of tension with the customers as they wait for their tracking code. Don’t let it linger. Once you don’t hear from your supplier 24 hours after placing an order, get in touch to sort it out. When you make inquiries, you will know, at least, why the order is yet to be processed and how much longer you have to wait. Pass the information to the customer to pacify him/her.

Supplier Transparency and Compliance

You are the face of your business, and your customers will hold you responsible for the quality of the goods they receive when they buy from your store. Now, you are hardly involved in the production and packaging of the goods you sell through dropshipping, but you are still responsible for them. One way to handle this challenge is to have a strong service level agreement (SLA) with your suppliers. You need to clearly state what you expect from them in terms of compliance with the agreement. The consequences of violating the SLA should also be spelled out. Take every complaint raised by a customer seriously and find ways to ascertain that your suppliers are always adhering to the SLA guidelines.

Shipment to Wrong Address

As awkward as it sounds, some orders are shipped to either the wrong address or addresses that don’t even exist. That is another major challenge you may have to handle as an ecommerce entrepreneur. The best way to handle this problem is to ensure that address mistakes don’t come from your end. It is necessary that you double-check the address you send to the supplier for each order. You should also hold some sort of proof of any shipping address you supply.

Products Returns

This is something you can’t escape in ecommerce. Most often, it is never your fault since a third party is always involved in dropshipping. You can’t also make all the rules here. Suppliers have different ways of handling returns, and you must find ways to communicate that clearly to your customers. Just know that your customers will come to you and not the supplier. Spell out the return policy on your website clearly. Put in every necessary effort to make the process smooth for your customers too.

Managing the Numbers

From inventory to billing, you will find out that managing the numbers can be really challenging, even in dropshipping. Pricing is another important factor when it comes to getting it right with the numbers. Obviously, you can’t handle everything about numbers the processes will throw at you. The right thing to do is to invest in the appropriate technologies for these. Automating each process will make things easier and give you the time to focus on making important decisions to grow your business and attend to other important issues.

Just like other business models, dropshipping presents lots of challenges. These seven discussed here are common. Overcoming them will help you in many ways to grow your ecommerce business. Contact us today at Fulfillman if you need a reputable fulfillment services company for your ecommerce or dropshipping business. We are a leading provider of various services including Warehouse fulfillment, Drop Shipping, Third Party Logistics, Crowdfunding Fulfillment, China sourcing, and so forth.

Our services are well-detailed, reliable, and highly professional. Our trusted experts will be available to speak with you and discuss your needs. We will provide suitable answers to your questions and concerns. With us, you are guaranteed to get quality and excellent services that give complete client satisfaction.