Using drop shippers…

A drop shipping company is one that buys products in huge numbers, and then stores them in a warehouse somewhere. Because they are buying in bulk, they get the best prices per unit on every individual product they buy, and because they often own their own warehousing facilities, storage costs are fairly limited as well.
While some drop shipping companies specialize in particular types of products (e.g. household electrical items), many will buy almost anything, with the vast majority of products (if not all) being brand new but surplus to requirements. For example, many drop shippers buy government surplus equipment and products.
Consequently, almost irrespective of the business you are in, there will be a drop shipping company somewhere that has products that are relevant to your business.
If you want to work with a company like this, this is how it happens.
You advertise a particular product on your website, one that you know a drop shipper somewhere is holding in stock. You find a customer for this product, the customer pays you for it and you then transfer a proportion of that money to the drop shipper to buy it from them on the customer’s behalf.
The drop shipping company then delivers the product directly to the customer, meaning that you never hold of the products in stock nor do you have to get involved in delivery.
The price the customer paid is higher than the drop shipper is charging you, so the difference represents your profit.
The advantage of this is that there are drop shipping companies all over the world, with a simple Google search for ‘drop shippers’ turning up companies in the USA, Australia, the UK and mainland Europe. If you can read Japanese or Chinese, you will find many drop shipping businesses there as well.
If you have customers in these countries, you can use drop shipping companies to supply products to customers in the same country. You have minimal involvement in the logistic arrangements, and there is no necessity for you to carry inventory at any point either.
The disadvantage of this approach is that the products offered by drop shipping companies are generally dependent on what they can obtain, and it can therefore be difficult to supply a consistent stream of the same products.
Furthermore, because you are dependent on the drop shipper for the contents of your product catalogue, that catalogue could become immensely complex if you are supplying one type of product in Australia, a different type of product in the USA and something completely different in mainland Europe.
Having said this, using drop shippers does have significant advantages, so it is something worth considering.
Buying in bulk overseas
Another option to consider is whether you can buy the products that you want to supply in bulk from countries where manufacturing costs are considerably lower than they are in the developed industrialized nations of the West.
For example, if you use the Google search suggestion tool, and start to type ‘discount Chinese’ into a standard Google search, you will see that Google has plenty of suggestions about the kind of products that you can buy in bulk from China at a discount:

Try looking at Alibaba.com as an example of the kind of products that you can find and add to your catalogue for supply to your customers:






Buying in bulk has a significant advantage in terms of price, but the downside is that you have to buy thousands (or at least hundreds) of whatever you want to supply in order to take advantage of the lowest prices.
Nevertheless, the savings on offer could make this worth it if you work in association with an order fulfillment company. Companies like these provide warehousing space where you can store the bulk order that you have just bought and also delivery services so that the products can be delivered in small numbers to customers or sometimes other businesses.
You do not need to stock the inventory itself and the logistics of getting the product from your warehouse to the customer can be dealt with by the fulfillment company. In addition, many fulfillment companies will provide other back office services as necessary to help you to control your stock and to run your business.
Some companies like ShipWire (the fulfillment house that is integrated with Zen Cart) have warehouses in many countries (in this example, USA, Europe and Canada), so you can achieve significant geographical
reach by using just this one company. However, you can find many other similar companies by running a Google search for ‘order fulfillment’ or ‘order fulfillment services’.