Advantages of Being a Drop Ship Vendor
If you are a drop ship vendor (DSV), you understand the challenges and costs associated with EDI, the labor intensive activity associated with fulfilling small orders and the struggle with profitability on some items.
If you’re not currently a DSV, you may still have the challenge and cost associated with EDI, but large orders minimize the cost of labor and item profitability. But you may also be in a situation where you are being pressured by your big box customers like Walmart and others to engage in their drop ship program. Or, you may be looking to expand sales through e-tailers like Wayfair.com, Overstock.com, Jet.com, etc.
Actually, there are some pretty good reasons to be a drop ship vendor, like:
- Suppliers stand to have better margins as a DSV because in typical big box brick and mortar fulfillment, retailers beat you down on price but say you can make it up in volume – that never really happens. You end up taking lower margins due to allowances.
- Online shopping is a powerful and lucrative force that allows suppliers to be nimble and react quickly to market demands, to observe changes and gives a better sense of real-time demand for product which makes inventory forecasting easier
- Drop shipping becomes a suppliers bread and butter, where risk is spread across many retailers as opposed to a big box program that can end without notice at any time and leave the supplier in a horrible position with unsold inventory and a huge loss.
Yes, there also challenges, but OPAL takes them all away. You can process a drop ship order in 8 seconds or less. This means you can receive orders from your customer retailers and e-tailers, manage all of their EDI transactions, process and invoice orders through your ERP and accounting system, create packing slips and custom branded 3rd party shipping labels and get them to the warehouse for pick, pack and ship – 24 hours per day, seven days per week – even when there’s no one in the office. And, you are also able to do all of that WITHOUT ANY EDI DOCUMENT COST from an EDI Service Provider!