Building a Drop Shipping Business in Australia

The success of any drop shipping business in Australia depends on the choice of drop shipping suppliers and manufacturers that you choose. Finding genuine drop ship suppliers is often a daunting process. And even after finding the right one who is willing and ready to drop ship for you, still you may face negotiation challenges in the process.

Very few suppliers will offer products based on your terms. Accordingly, it is pertinent to negotiate with as many suppliers as possible—this will not only increase your chances of finding the most suitable supplier, but will also provide you with ample opportunity to swing negotiations on your favour by quoting rival rates or offers.

Finding Ready Drop Ship Suppliers

Before you begin the negotiation process, you need to find genuine suppliers so that you don’t waste much of your time negotiating with wrong suppliers. But how do you find suppliers who are ready for the drop shopping deal, experienced, and reputed for ethical business practices? Here is an overview of a few tips:

• Contact The Suppliers Directly: Search for the contact details of manufactures or suppliers on the products that you want to drop ship and call them. Most large manufactures are often aware of the drop shopping concept and if they agree to drop ship, you can begin the negotiation process.
• Convince Or Persuade Suppliers To Drop Ship: As aforementioned, many suppliers in Australia are aware of the drop shipping concept. Some of them often believe that sellers who are not ready to run risks or invest in stocks are generally not serious about business. They feel that they can still get hold of many customers without going the drop shipping way. To go around this common misconception, you need to be ready with a persuasive proposal that will convince such suppliers to drop ship for you. In certain situations, some suppliers and manufactures may not be aware of the drop shipping concept or model. For such, you can explain to them what drop shipping means and see if they can try your services.
• Check the Latest Australian Drop Ship Directories: There are myriad drop ship directories online, some of which are free and others are paid for. Free drop ship directories tend to be outdated and often contain unverified dropshippers who are known to rip off resellers their hard earned cash. However, they are good starting point. You can run checks on a few dropshippers that you find in these directories though, and place a few sample orders to check the quality of their services. On the other hand, paid directories often verify and closely monitor most of their listings, and can save you lots of time in finding good suppliers to drop ship for you.
• eBay: eBay is another great place to find dropshippers. Many eBay Powersellers are known to wholesale their products. Provided that you don’t undercut them, most of them will be willing and ready to fulfill your orders in exchange of your willingness and effort to market them on eBay or any other online or offline platform. eBay is a very competitive marketplace with Powerselllers who have access to unmatched rock bottom prices. So you should never underestimate their value; you will find that many of them are willing to partner with you on a drop shipping basis, mostly in exchange of selling their products faster.
• Search From Wholesalers: Many established manufacturers and suppliers drop ship via wholesalers or distributors, and will be willing to connect you with local suppliers. Some manufactures may not understand the drop shipping model or may be unwilling to drop ship, in which case, you may have to look up for and convince their authorised distributors and see if you can broker a deal with them.

Negotiating the Deal

After you have located and short listed the appropriate dropshippers, it is time to begin the negotiations. Generally, you will be the smaller party considering that there will be other sellers who are ready to work with the drop shipper’s terms—this puts the dropshippers in the power position. As you would expect, you will experience a little pressure. However, this does not mean that you have to agree with all their terms without any input. Here is an overview of some successful negotiating tips that you can utilise:

• Mind Your Tone: In negotiations, bad tone often creates hostility and defensiveness. The same is true with statements that can be confused to be ultimatums—these include statements such as “I will take my business elsewhere”, “that is unfair” and “if you don’t buy the idea” among others. You should instead use statements such “I have a bit of reservations about the proposal,” “It would have been more convenient to, “and “I understand the direction you plan to take” among others.
• Pay Attention To The Supplier’s Needs: Negotiations are not about defeating the other opponent but finding a common ground to work on and creating a healthy working relationship. If the supplier expresses a concern, try to provide assurance that you will work with them to find a better solution.
• Express Yourself Clearly: In any negotiation deal, miscommunication can easily lead to misunderstanding. Accordingly, in cases where you feel that explanations may be adequate, you can avail charts and reports. Let suppliers know that you are great in promoting products by presenting them with a well laid adverting plan. Let them know how you plan to acquire customers and how you will deal with rival products.

• Let Them Know That You Have Other Options: Appear as if you have other options even if this was the only drop shipper who agreed to discuss the drop shopping deal with you. In the negotiation process, you can always hint that you are in negotiation with other suppliers. Many suppliers will agree to deal with you after finding out that you are planning to promote a competitor.
• Don’t Be Caught Up In Unethical Business Deals: In today’s competitive business world, many businesses are willing to get involved in anything to be ahead of their competitors. If a supplier asks you to resort to unethical methods, you should refuse politely. A supplier who is ready to cheat your customers will eventually cheat on you as well—and you will lose tenfold as you will be the one to deal with customers grievances.
• End The Negotiation On A Positive Note: Even if the negotiation process was unsuccessful, never slam the door for future partnership opportunities by walking out on a bitter note. Suppliers often have second thought and may get back to sellers a few months or days after the initial discussion. So let them know that you are always open to future business, even if you could not accept their proposals this time round.

Ideally, finding a good supplier and successful negations is never the end of successful drop shipping process. You need to work closely with the supply to ensure that your business relationship is in a good shape. This will go a long way in ensuring smooth functioning and success of your drop shipping business in Australia and beyond.