Wholesale or Drop Shipping..you be the judge

Drop shipping or wholesale??? The question is a hot topic online right now. Although most people online seem to focus on drop shipping...it is not the only option for someone looking to open their own ecommerce website. Buying wholesale (in bulk) is another great option. You would be buying first and selling later. Although there is a risk involved the profit margin is much greater than drop shipping…well, sometimes! I say sometimes because the drop shippers you will find on One Source are selling their products wholesale. However, you will be the one receiving the “handling” fees and shipping the products, which is where some companies “get you”.

Buying bulk items wholesale can give you a huge advantage. Not only will you have more flexibility with your prices (because typically bulk is much cheaper than buying one at a time) but you will also have the capability to ship the items yourself. Shipping the items yourself does require more time spent on your end than drop shipping does, but with shipping the items yourself you will more easily be able to answer customers questions about when something should be arriving, and you will be spending less money for the shipping and “handling” fees.

From my own personal experience, I typically tell people to start with drop shipping, and evolve into buying bulk….but that isn’t for every item, and every person. There are some products that it just doesn’t make sense to buy in bulk. An example would be electronics. You will not find legitimate name brand products being drop shipped or sold in bulk. That is because the big companies/ manufacturers such as Nintendo (for example) will sell only to large businesses in bulk orders of several hundred thousand dollars…and no less.

You would be successful with buying shoes in bulk. Shoes like Sketchers sneakers (for example) would be a profitable investment. There are sites where you can buy a skid load of sneakers for only a few hundred dollars…your profit potential would be huge! It just all depends on 2 personal qualities. The first one being upfront capital…if you have it, great! If not, then stick with drop shipping. The second one being, are you willing to take a risk? If you aren’t able to financially handle a loss then again, stick with drop shipping, and leave buying in bulk to the people who can afford it. There really is no right or wrong answer here. It is simply what you prefer and what you can handle.

How Worldwide Brands Works

To get started, I want to walk you through how Worldwide Brands works. First off, you must log in to the secure members only area. Next you can either browse through their library of valuable resources and videos, or you can click the launch button and go straight to OneSource. Once you have entered the directory, you can choose a category or a search word/ phrase (or both). I decided to use only a keyword, no category. The keyword phrase I used is “As Seen on TV” (which is listed on our Dropship Secrets page). As of today (01/04/08) there are:

2 Drop Ship Wholesalers

2 Light Bulk Wholesalers

1 Instant Import Buys

5 Liquidation Auctions

Although the numbers are quite low compared to other searches (like “camera”, which has over 700 suppliers), this is definitely a profitable niche. I know it is profitable because of the Market Research Tool, which rates every search I do, and tells me what the profitability is for that product. And in this case, it is 70% profitable, which means I have a very good chance of making money from this particular niche product.

What about the suppliers? You ask. Well I can assure you, they are the “real deal”. One of the sites alone has several thousand “As Seen on TV” items ready to be drop shipped.

Another niche we have previously discussed is home schooling. So I typed “home schooling resources” into the keyword bar and hit search. What came up was not all that surprising. There was only:

1 Drop Ship Wholesalers

1 Light Bulk Wholesalers

And the Research Analysis Tool gave it a 22% profitability margin. This alone tells me to move on and keep looking.

Using One Source is a really quick and easy way to take an idea, research it, and if it gets a good profitability score, to go with it, and begin selling! I have not found any source on the web that even compares to what Worldwide Brands is offering.

Dropship Source Directory

When starting a dropshipping business, a Dropship Source Directory is key. Finding a good supplier is by far the most important part of the puzzle..and also the hardest. Using a Directory is really the only way to compare and analyze who is out there. As long as you have a good supplier, with good pictures, descriptions and pricing, the rest will fall into place (granted you know HOW to market). Here we will briefly describe each supplier in our Dropship Source Directory, and the pros and cons of each.

Doba

Doba® is one the largest wholesale supplier/dropshipping company on the web! They provide their retailers with over 1,200,000 products from hundreds of suppliers to promote, sell and profit from. In addition to providing a one-stop shop for products to drop ship, they also provide services such as advanced tools, data export, Push to Marketplace (eBay integration), intricate training and learning materials. They offer professional, quality product pictures, detailed descriptions, guarenteed lowest wholesale prices, and have everything on their site in stock about 90% of the time.

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One Source

One Source (a.k.a. Worldwide Brands is by far the largest dropship source directory in the world! With their lifetime membership (a one time fee), you get access to over 3,000,000 million wholesale products from more than 9,000 suppliers worldwide! One tremendously helpful feature One Source offers is the market research tool, which will actually analyze the product(s) you are searching for in their directory, and tell you the profitability of that product.

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Dropshipping Wholesalers

Dropshipping Wholesalers is an exclusive membership site, which gives access to over 500,000 products. Not to mention 10 ultra secret Chinese wholesalers, and over 600 of the worlds best wholesale dropshippers. With this directory you are granted lifetime access to all of their resources, and do not have to worry about "everyone else on the web" having the exact same information. This is because they are only offering this as a limited time offer. You will also have access to eBay ad wizard, and many other great features.

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Simplx

Simplx, like Doba® offers you a one stop shop at the cost of a monthly fee. They currently have over 60,000,000 products, eBay integration, up to 95% off retail prices and millions of name brand products. All of the drop ship products they offer, are brand new and have manufacturers warranties. Unlike Doba and One Source, Simplx has a screening process before they will accept new marketers to use their products. Once you go to their site, and fill out the application, they then ask for your credit card information....which causes many people to lose interest. This is the only major dropship source directory/supplier that asks for an application fee ($20). This fee is non-refundable, so whether or not they grant you access, they still pocket your $20. There are many pro's and con's to that system. First of all, it does elliminate competition, because most people aren't willing to invest even $20 into their business....which is not very much money when you consider starting a traditional, brick and morter business. And as they state on their site, they do this to elliminate market saturation on sites such as eBay.

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