Hellllo again. Ready to learn how to drop ship with multiple suppliers? 🙂
If you’re just getting into drop shipping, this article is going to show you how it’s possible to drop ship, not with only one supplier, but with multiple suppliers.
Now, you may be thinking, “But, what’s the difference? How is it different to drop ship with multiple suppliers?”
Well, the drop ship business model is complex with many moving parts. If you refer back to some of my earlier content on drop shipping, you’ll see that there are many operations that need to be going on at all times in order to have sound function.
From finding the right products to forming supplier relationships to organizing the product data to listing the products all the way through to the customer service, there is a lot that goes on in a drop ship business.
But don’t worry, I’m here to show you how to drop ship with multiple suppliers so that you don’t end up sending an order from Supplier X to Supplier Y.
That would confuse a lot of people…and no one wants to work with someone that is confusing them.
How to Drop Ship With Multiple Suppliers
In order to drop ship with multiple suppliers, you of course need to create more than 1 supplier relationship first.
To learn how to research, contact, and form strong supplier drop ship relationships, refer back to earlier articles where I focus on the exact processes and sales pitches that I’ve used to land over 1,000 relationships with suppliers around the United States.
Assuming that you have multiple drop ship suppliers working with your business, you need to get the following aspects of your operations down to a tee so that your operations run smoothly once you start getting orders galore.
1) Organize the Relationship Upfront
When you get a “Yes, we’ll work with you” from a supplier, make sure that you don’t just jump into listing their products. Take the time to talk to them on the phone and go through a number of important questions that will outline the expectations of your relationship with them.
I can’t tell you how important this is. When I first started drop shipping, I didn’t have a good process for onboarding new suppliers and it eventually led to chaos and confusion months down the road. I was getting orders and didn’t know where exactly to send the orders making my processes inefficient. You don’t want that.
Here are the topics to go over when setting up a drop ship supplier relationship:
- How will you send the product data over? You need organized product data so you can properly list the products. If you don’t have it, you’re not going to be able to create good listings and distinguish one suppliers products from another.
- Where should I send orders once I get them? How do you want to receive them? Email? Through your site? Etc.
- How can I get inventory updates on your products? You need this data so you don’t sell products that are out of stock.
- How should customer service tracking, returns, exchanges, and cancellations be handled?
Get all of this down in a Google document that you can refer back to as you are working with this supplier.
If you want to take it a step further, put it together into a quick e-sign document and have both parties sign and agree to the terms so that you can bring it back into play if the supplier defaults on one term in the future.
2) Distinguish Products to Suppliers With Unique SKUs
Once you have all of the product data from the supplier, put it into your own spreadsheet so that it’s easy to manipulate and list on your online store.
Take the supplier SKU or item number that they provided you and turn it into your own unique SKU that you can use to identify it on your orders and then in your spreadsheets.
Here is an example:
- Supplier provided SKU: BESTSUPPLY-1289
- Item #: 1289
- Your Company Unique SKU: BS-1289
When you receive an order or you need to update inventory, you can now easily search the SKU in your spreadsheet and see which product it is. From the SKU, you can also easily see the supplier that it is for…BS – Best Supply.
Do you see how this simplifies the process of working with a supplier?
Now imagine, you have 100 suppliers. Each day, you get orders and you can easily see who they are coming from. Once you get enough data, you can figure out which suppliers are selling the most and which are your hottest sellers based off the SKUs you created.
3) Set Up an Organized Order Fulfillment Process
With your SKUs in place and relationship expectations set upfront, your order fulfillment process should be easy to bring together.
As you receive orders from your online store, take two actions to properly fulfill it:
- Search the SKU in your spreadsheets. (1) Make sure that it is in stock and (2) if in stock, grab the product name and other supplier specific data that you need to fulfill the order.
- Search for the supplier relationship document and look at how they want the orders submitted.
Combine that data and fulfill the order to the likes of the supplier.
Bonus: You should also have a document where you can track all of your orders each day. Record the product name, SKU, revenue, cost from the supplier, shipping cost, estimated sales tax, profit, supplier order number (once they send it back), tracking, and notes. This will help you to stay even more organized as you drop ship with multiple suppliers.
What Questions Do You Have?
If you can organize those three aspects of your operations, you should be able to successfully drop ship with multiple suppliers.
Of course, there will be other important factors that have to do with your inventory management and customer service management, but those are complementary to the 3 core areas that I outlined above.
If you don’t set up the relationship properly at the get go, you’ll never know where to send the orders.
If you don’t have an organized system of internal SKUs and product inventory, you’ll never be able to find the product and keep track of it.
And if you don’t have a good process for fulfilling and tracking all orders, you’ll never be efficient enough.
What other questions do you have about drop shipping with multiple suppliers?
Let me know in the comments and I’ll gladly answer.
You can also email me at Connor@ConnorGillivan.com if you find that to be easier.