Drop shipping is an ecommerce solution that enables merchants to collect and forward a customer’s order and shipment details to wholesalers and Manufacturers. It’s the wholesalers and Manufacturers who then supply the products directly to the customer. This business is increasingly gaining popularity with ecommerce website owners as it requires less or no inventory and reduces shipping costs.
Drop shipping is a very cost effective way of doing business and is a model that ought to be encouraged especially for web based businesses. The website owner should thoroughly research the wholesale companies that they intend to engage with so as to avoid dealing with resellers. What these reseller companies do is that they have no inventory themselves and actually add a markup price. It’s these reseller practices that make it difficult for any drop ship business to make a decent profit. Businesses should always identify legitimate wholesalers and manufacturers to deal with. So as to run a successful drop shipping business, always engage with those wholesalers that have low shipping and handling charges. In order to start a drop shipping business, one would first have to establish whether they require a high risk merchant account or any other type of merchant account.
In-order to fully enjoy benefits associated with drop shipping, businesses are advised to open a merchant account for drop shipping. This type of account is especially important to ecommerce businesses as it guarantees the much needed online security. Although many people make payments via the internet, there are still a lot more who worry about credit card fraud. Having a merchant account for drop shipping would go a long way in assuring your customer’s safety.
A Fulfillment company merchant account enables an ecommerce business to concentrate on its core business, while outsourcing its package and shipping functions to a third party order Fulfillment Company. These fulfillment companies are responsible for taking your product off the shelf, packaging and handing them over to the shipping company. Once that is done, it’s the fulfillment company responsibility to notify the customer that their package is on transit. With the growth of drop shipping, many ecommerce website owners are increasingly engaging the services of order fulfillment companies due to the numerous benefits associated with them.
An ecommerce business is able to minimize on its staffing, with businesses likely to experience peak seasons, hence the need to hire temporary staff to handle the extra workload. Once a business engages the services of a third party order fulfillment house, it reduces its workload and its need to hire personnel, as all the workload is addressed by the fulfillment company. Fulfillment companies once contracted are responsible for warehousing, thus absorbing all costs that are associated with warehousing. This has made them very popular with businesses that are seeking to reduce or even do away with warehousing costs. A Fulfillment company merchant account could also be used by a business to track, while providing periodic detailed records of all the drop shipping activities that account has handled.
Merchant accounts involve agreements made with financial institutions to allow a business accept credit card payments. The result of this agreement is that once an online transaction has been approved, your bank account is credited with the amount. Merchant account for drop shipping is vital to the success of any business that accepts credit cards payments. These accounts validate a customer’s credit card’s information and make sure funds are available to complete the transaction.
EMerchantBroker provides high risk merchant account to online businesses to enable them to meet and process their credit card transactions. In today’s dynamic business environment, it pays to provide your customers with different payment options.