If you’re not already doing it, here’s hoping you never find yourself in the position where you have to drop ship your products directly to consumers. It is a time consuming, detailed and often painful process with a great deal of pressure on profit margins. Especially if you are selling through the large retailers and e-tailers. But, if the 2017 industry trends are to be believed, you may very well find that you will need to adapt.
If you’re already drop shipping, you are aware of the problems:
- Consumer expectations are getting higher almost every day. If they order something at 3:00am Saturday morning, they want to see an acknowledgement, tracking number and expected delivery date very quickly. They also expect to receive that order in a few days at most.
- Marketplaces also have increasingly high expectations, and if you don’t meet those expectations there are financial penalties. More and more, they want their suppliers to drop ship from their own warehouse rather than one of their fulfillment centers, provide acknowledgement, tracking number, ship it in three (3) days maximum, provide accurate invoicing and provide them with accurate item inventory updates.
- One of the highest expenses for any drop shipping business is labor. It’s the wages you pay; plus having the correct number of employees on hand when you need them. Having more employees than orders to process can be costly and the other side of that is not having enough employees to process orders.
- Product profitability can be severely impacted, especially if the retail cost is low. You may be selling more but your profit margin may be very thin or even non-existent.
Now, on the other hand, large shipments can be very profitable because it requires much less order processing labor to handle those high revenue orders.
So, as I said: May you never have to drop ship! But many of you already are. The retail world is changing rapidly with on-line shopping by consumers growing by double digits each year. Are you ready for an inevitable change?
OPAL bridges both worlds – container, truck load and LTL shipments, as well as giving you the capability to expand more and more into the drop ship business as available without the problems we just spoke of. It gives you the ability to grow and adapt over time, easily.
Are you striving to achieve productivity gains to increase drop ship order profitability? Are you currently avoiding drop shipping, but see the writing on the wall. Before dismissing the possibilities, please contact OPAL – the ONLY Autonomous Order Processing solution – to see what it can do for your business. Book your FREE Demo now.