If you followed any of the YouTube tutorials I’ve posted online, you understand that it’s no longer that difficult to build a simple ecommerce store to start selling your products online.
It’s now 2015 and whether you are using WordPress to build your own custom store – or perhaps a popular out-of-the-box-ready monthly service like Shopify to quickly validate your business idea – having an online store is now the easy part of the ecommerce equation.
The challenge today is finding the right product from the right supplier. Ideally, a drop shipping supplier.
In case you are not familiar with drop shipping, the concept works like this: Jennifer places an order at your online store. The money changes hands and is transferred to your bank account. At that point, you forward the order to a drop shipping company and pay for the same product (at a lower price than what Jennifer is paying you for the same item). The drop shipper takes the product from their warehouse, packages it nicely and sends it to Jennifer.
She receives her product days later. Your company info appears as the sender. Jennifer is happy with her product and you are happy because you made a sale that resulted in only profit, all without ever having to stock or even touch this product throughout the entire transaction.
Not bad right?
A good product from a trusted drop shipping supplier will eliminate the need for any up-front investment on your part, while at the same time returning a healthy profit margin on each and every product you sell.
Welcome to the new rules of ecommerce. New rules that smart entrepreneurs are taking full advantage of to build online businesses without risking thousands of dollars in buying inventory – inventory that at the end of the day nobody might be interested in.
Unfortunately, finding a good drop shipping supplier is easier said than done.
Real wholesalers and drop shippers are notorious for having non-existent marketing and websites that look like they got frozen back in 1998. And don’t even get me started on their SEO… it is damn near impossible finding them through a normal Google search.
Not that these guys care too much. After all, a suppliers’ main business is to ship product to retailers, not offer a pretty website for customers to place orders. Their priority is shipping logistics, not marketing.
The bad news is that this leaves you in a tough spot when trying to find a good company to work with.
One of the approaches ecommerce beginners take is to do hundreds of Google searches to try and find a good distributor. They not only waste a lot of time but also their hard-earned money – most of the time leading them into a dead end.
For example, let’s say you find a “drop shipper” that looks like a great option at first glance. They have a professional website and they mention having “thousands of products at the lowest wholesale prices.” Well, after paying your non-refundable fee to create an account and access their catalog & pricing, you find out they have inflated prices that are just below retail. Trying to turn any meaningful profit would be impossible since you are dealing with another middle-man.
It’s back to Google for more searching and phone calls.
Fortunately for us, there now exist a number of large online directories available just to solve this problem.
Below you’ll find a list of the top wholesale & drop ship directories of 2015. Some of them are free; others charge you a monthly or one-time fee to join. I’ve included my personal experience with all of them to help you make a more informed decision. Hope it helps.
Wholesale Central is one of the oldest directories on the web to find wholesale and drop ship distributors. The directory is free to access, which is great for anyone just getting started and on a limited budget. However, since the website is free, it’s rarely updated and a lot of the companies listed are no longer in business – in other words, don’t be surprised if you never get a reply back from a company when trying to inquire about their products.
Still, there are a few hidden gems in Wholesale Central so it’s worth a look.
SaleHoo is my favorite premium directory of them all and one I highly recommend you check out to quickly find a great product to sell online.
Their private directory is really user-friendly and finding wholesalers or dropshippers in a specific category is a snap. As a bonus, SaleHoo also provides you with some handy tools in order to check out the profitability of the niche you are interested in before picking a product to sell.
Not too shabby.
The only current downside to SaleHoo is that since it’s a little bit of the new kid on the block, it’s not as extensive as some of the other more established directory websites on this list. However, new companies are being added to the Salehoo directory all the time, so expect this to not be an issue in the future.
Doba is a directory for finding drop shipping suppliers. I originally had high hopes for Doba when I signed up for their free 30-day trial. Their user-interface was a little clunky but there seemed to be a large amount of products to check out. Unfortunately, the majority of products that I found were popular items, something that I’ve learned to avoid in order to prevent a price war with Amazon (a war I’d most certainly lose).
The thing that left a really bad taste in my mouth after trying Doba was their complete lack of respect for your personal information. Right after I signed up for the Doba free trial my email started getting spammed left and right. Also, my phone started ringing non-top with shameless telemarketer calls one after the other on a Saturday night.
I’m almost 100% convinced that Doba sells your email and phone number to other companies when you sign up. Do yourself a favor and use a fake number and burner email account if you decide to try their service.
Price: $19.99/mo. for the Starter Package or $59.95/mo. for the Advanced Package.
Worldwide Brands used to be the top premium directory before new companies started providing a better service for a much cheaper price. Worldwide Brands is still a good directory, but I just can’t give them a recommendation due to their high price – even if it’s for a lifetime membership. Online businesses simply change too fast to think you’d get a return on any lifetime membership down the road.
Price: $269/lifetime membership
Megagoods is not a directory but a real supplier I’ve used in the past to drop ship items on eBay. I love their professionalism in doing business as well as their customer support, although it’s a shame that their website is still stuck in 1999… along with their product catalog.
Megagoods has a good number of products, but they are incredibly outdated. If you are going to sell anything from MegaGoods, I’d recommend checking out their Antiques categories for some niche, retro products. That’s about it.
Setting up an account is not free either. They have a monthly fee of $14.99 to keep your drop shipping account active. Not the best move in my opinion considering their limited inventory and the fact that a lot of other great suppliers don’t charge a monthly fee to access their re-seller pricing.
Albany Distributing is a little drop shipping company based out of New York. They have a great catalog and beautiful website (rare for a supplier) that is very easy to use and well designed.
The thing about Albany is that most of the products they offer are fairly popular and mainstream, so most people will simply go to Amazon or their local electronics store to purchase them. Still, a savvy Entrepreneur might see a good opportunity so their catalog is worth a look.
Price: One-time setup fee of $59
Alibaba is the second biggest gorilla in the Ecommerce arena after Amazon. Just one look at their stock price on Wall Street will tell you that these guys are going nowhere but up in coming years.
Alibaba’s directory mainly consists of wholesalers and suppliers in China, with an immense catalog of every single product you could ever think of.
Unfortunately, most of these suppliers only work as wholesalers where you’ll need to order a MOQ (Minimum Order Quantity) of their product. In other words, you’ll need to make a significant up-front investment. Drop shipping is offered by some suppliers, but if you are based in a country like the U.S. for example, getting your product drop shipped to your customer could take 2-4 weeks minimum. This could easily kill any potential sales as people don’t want to wait that long for their orders to arrive and will just go somewhere else to buy their item. Also, high overseas shipping costs on low-cost products are just an Ecommerce killer.
Would I recommend using Alibaba.com? Absolutely.
One condition: You must have found and tested your niche successfully first. Once you know that your product is selling 100 units a month through your drop shipping company, you then get on Alibaba and look up how much it would be to order a MOQ directly from a Chinese supplier and the shipping costs associated with it. If the added profit per product is worth it, by all means you should do it.
What if you don’t have space on your garage or apartment for 1000+ units? Send your overseas shipment directly to a fulfillment center – they’ll take a small percentage per sale but will store and ship your product to your customers, just like any other supplier/drop shipper would.
Word of caution, you will start getting unsolicited offers from Alibaba suppliers once you start requesting quotes. So if you don’t want your email to be flooded, don’t use your primary email address to communicate with Alibaba companies. You’ve been warned!
We can’t really mention directories without including the biggest directory of them all right? Like I said before, wholesalers and drop shippers are notorious for having horrible marketing and even worse websites, so finding them through a search engine is very tough… but not impossible.
In order to find a diamond in the middle of the rubble you have go deep. You cannot expect to see any supplier or drop shipper with a well SEO’d website that will appear on the first page. Yes, that means going into the 2nd, 3rd, 4th, 5th page… and so on. It’s the only way of having a hope of finding something worthwhile.
Once you find a company that looks promising, do some research on them and then give them a call. Email won’t do here. You want to know this is a real company and you can reach somebody during business hours. If you can’t, chances are they are probably another “middle-man” acting as a direct supplier. Remember that real suppliers have real teams in place. In other words, it’s not just a one-man operation. There should be somebody that can answer all your questions about potentially selling their products on your store when you give them a call.