How to Find a Drop-Shipper
Q: I'm looking for a drop-shipper specializing in business books and software. Is there a list of drop-shippers somewhere on the Web for free? I have seen lists before for a cost, but they promise so much that I can't believe it's true.
A: Let me start off by saying you're right to be skeptical about drop-shipping lists that promise to provide up-to-date addresses for hundreds or thousands of suppliers who are just waiting to do business with you.
The old saying "You get what you pay for" definitely applies here. Spend a few dollars on a drop-shipping list, and you'll likely get an e-mail containing around 200 company names, addresses and maybe phone numbers. After a few calls to out-of-service numbers, you'll realize that the list is years old and basically useless.
And think about this: The companies listed in these directories are the ones that everyone who wants to set up a drop-shipping deal will be contacting (and they probably all bought the same out-of-date list). This means that even if you do manage to set up a drop-shipping arrangement with one of the suppliers you find on the list, there will be tons of competition for the products you'll be selling. So based on my research, I would not recommend spending money on any of the low-cost "drop-shipping lists" that are for sale online. After all, anyone should be able to locate potential drop-shipping partners by doing a little research and making a few phone calls. So where do you start?
Well, since you already know what type of product you want to sell, the best solution is for you to do some good, old-fashioned legwork. Spend some time looking around bookstores and searching the Internet for the books and software you want to sell. Take note of who the manufacturers are (for books, this is the publisher; for software, it's the developer), then contact them directly to find out if they drop-ship their products.
Some will let you know right away that they are set up to drop-ship for you. Others will tell you that they simply don't offer drop-shipping. Smaller publishers and developers may have never even heard of the concept (although this shouldn't stop you from explaining to them why it's a win-win situation and trying to work out an arrangement).
If the manufacturer of the product agrees to drop-ship for you--great! You can be fairly confident that you'll be getting the best price possible. However, if a manufacturer doesn't offer drop-shipping, you'll have to keep looking for another alternative. This usually means tracking down a distributor, a company that maintains a large inventory of another company's products and distributes those products to smaller companies. The best way to locate a distributor is simply to ask the manufacturer of the product to recommend one. Most manufacturers have established relationships with at least a couple of distributors, and they should be happy to put you in touch with one of them. You'll have one middleman between you and the manufacturer (which means you'll have to pay a slightly higher price than you would if you were dealing directly with the manufacturer), but you can feel confident that you're dealing with a reputable distributor.
Another strategy is to look through trade magazines for the industry you're interested in. You'll often be able to find listings of manufacturers and distributors advertising in the back of these publications--and since the distributors and manufacturers actually pay for these ads, they're certainly going to include the correct and current contact information. Yahoo! has a good listing of trade magazines to get you started. (Just go to Yahoo! and search for the phrase "trade magazines.") You may also be able to find distributors and manufacturers using the Thomas Register. This site provides listings for thousands of companies broken down by product, brand name and company name. It takes some time to get used to navigating through this site, and not all of the companies listed here will necessarily be willing to set up drop-shipping arrangements, but it can be a great resource--and it's free.
One more great resource I can recommend is the Drop Ship Source Directory at www.mydssd.com. (I know I just said I don't recommend drop-shipping lists, but this one's actually not a list--it's a subscription service.) This site actually updates its resources every month, so you know you won't be getting ancient, out-of-date information.
The short answer to your question is that just like every other aspect of your business, finding your drop-shipper will require you to invest a bit of effort. But if you take the time to do good research, you should be very happy with the drop-shipper you choose.
Corey Rudl, president and founder of the Internet Marketing Center, is the author of the best-selling course Insider Secrets to Marketing Your Business on the Internet. An internationally sought-after Internet business consultant and speaker, Corey focuses his energy on the research and development of practical, cost-effective Internet marketing strategies and software for the small and homebased business owner.
The opinions expressed in this column are those of the author, not of Entrepreneur.com. All answers are intended to be general in nature, without regard to specific geographical areas or circumstances, and should only be relied upon after consulting an appropriate expert, such as an attorney or accountant.