Drop shipping has gained popularity over the last few years. By managing the inventory and distribution of products, drop shipping companies have lowered the barriers of entry for new online retailers. It allows these online retailers to focus solely on selling products instead of worrying about operational logistics. Once a retailer receives an order, the drop shipper fulfils the shipment. The drop shipper also sends paperwork to the customer with the retailer's name, address and pricing, keeping the transaction transparent to the customer.
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Things you need
- Website hosting
- E-commerce software
- Drop shipping provider
- Payment processor
Set up a website hosting account. Since additional software is required to run the website, find a web host that allows the installation of third-party software. As of August 2010, hosts like SiteGround offer packages of this type for about £2 per month.
Install an e-commerce software package. E-commerce software manages the product catalogue and checkout process for the customer. The web host will generally make three or four packages available for installation. Try each to determine what best fits your needs. Installation is a point-and-click operation that only takes a few minutes.
Find a drop shipping provider. Many companies offer drop shipping services. Drop ship aggregators like Doba consolidate these choices into a more efficient format to make choosing and selling easier. Once you agree to the drop shipper's terms of service, it will provide a product and price list.
Create the product catalogue and set pricing. This involves manually entering items into the e-commerce software database, adding available item pictures and setting the selling price. The e-commerce software will have a menu dedicated to this function. Enter the item name, description, price and picture. Click "save" when complete.
Open a payment processing account. A payment processing account allows customers to pay for items by credit card or other electronic means. Many small businesses choose Google or PayPal, but explore all available alternatives, as other providers may offer better rates.
Test the site's functionality. Run tests as if you were the customer. Try every function several times to ensure things are working properly. Once completed, the site is ready for launch.
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