Dropshipping is not a viable choice for a retail startup…or is it? All too often the spotlight shines upon those who are constantly in the media; we all know success stories fill the shelves at our local Barnes and Noble of famous people, but what about a true hometown success story?

Let’s travel back a few years, 9 to be exact, and meet a couple of college buddies who were working to earn a masters degree at California State University Chico, here in northern California. Christian (Chris) Friedland and David Bocter started a small E-commerce business selling plumbing supplies, faucets to be exact. This venture met the guidelines for a class project and they both hoped it might bring in a small income to subsidize college expenses.

As a partnership, Chris brought experience from a local plumbing supplier, while Dave provided early funding. Faucetsdirect.com was born and quickly became a success; in fact today the company employs over 200 people here in Northern California under the parent company Improvementdirect.com. The operation now boasts 12 separate websites offering the latest in home improvement products.

Back then and still today; this company uses the Dropship model for product fulfillment. Improvement Direct has fostered relationships with some of the largest manufacturers and distributors of home improvement products in the Country.

In 2007 Improvement Direct was acquired by Wolsey North America, a Fortune 500 Company. Chris still serves as president and is active on the lecture circuit. In 2008 he was a featured speaker at the 2008 Internet Retailer convention and the Wharton School of Business.

Improvement Direct is proof positive that dropshipping can work, but be weary of all of the hype advertised on the Internet. There is no secret dropshipping directory or list that offers exploding profits for your business. If you want to offer an extensive product line your best bet is to seek out product manufactures and master distributors who will serve as your virtual warehouse shipping your items out one at a time to your customer base.

It is all about building relationships with your inventory sources; I would be inclined to say that you should chose a distributor or manufacturer that is not advertising dropship services. Build a relationship and show each prospective inventory source how a mutual relationship can benefit the both of you.

Here are a few other tips if you are planning on using a dropshiper for product fulfillment:

1. Thoroughly investigate the supplier who will be packing and shipping your order. Check financials and search for complaints on the internet.
2. Ask for references from current accounts and then follow up by contacting each to see if they can offer insightful information about their relationship with said supplier.
3. Look for a supplier who will be willing to offer an in-house credit account; typical terms you can expect would be Net 30. Net 30 simply means full payment due within 30 days of purchase.
4. Make a “test” order and have some merchandise shipped to relatives, preferably in two different states.
5. Whenever possible find suppliers who are geographically close to your business location. A face-to-face meeting and inspection of the manufacturers’ facility can pay off In the long run. Plane tickets or a tank of gas can easily be written off as a business expense.
6. Seek out unique products to resell. Why compete with hundreds of other websites selling the same merchandise?

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