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The dropshipping industry is a relatively new phenomena. This is due largely to the fact that in the past, the technology just wasn’t available to allow individuals to process their orders electronically. While it is possible to work with dropshippers in person or over the phone, the chances are you are going to be processing your orders over the Internet. That technology simply wasn’t there 20 years ago. Another factor that is thought to have given rise to dropshipping was the development of Just In Time (JIT) inventory control. This process, developed to an art by the Japanese auto industry, lead to rewriting of the logistics rules. Sophisticated computer technology allowed real time inventory accounting and forecasting to change the way product logistics were handled. Today, JIT is common place. In effect, dropshipping is just another application of JIT!

So now just about anyone can take advantage of real time inventory control techniques to get products to customers only when they need them. That’s where dropshippers come in. You set up your online storefront, a customer makes a purchase, and you transmit the order to the dropshipper who pulls the merchandise, packages it, and ships it to your customer. Presto, you’ve made a sale and you never even had to lay eyes on the product.

There are many advantages for sellers, the biggest of which is the fact that you don’t have to carry inventory. The dropshippers will do that for you. They get their products directly from the manufacturer and because they are buying in such large quantities, you can enjoy a significant price savings.

Dropshipping is not without its hazards. You much rely on the dropshippers to get your items to the buyers on a timely basis. You also rely on them to make sure that the quality of the products is what you expect. As you are looking for good dropshippers, be cautions of companies that attempt to insert themselves into the process. These companies are known as “middlemen” and they attempt to get a mark up on the products before they go to your customers. It can be difficult to spot these middlemen as their who goal is to appear to be a legitimate wholesaler. Key tip-offs are set-up fees and monthly fees to use their services. Legitimate wholesalers will not charge you these fees.

As most of us know, anytime an industry is thriving, particularly anything relating to the Internet, it becomes the target of scammers and other unscrupulous people. As a consequence there are a few other things you need to be on the alert for when you begin to think about tackling the dropshipping market. The first of these are lists and directories that are available. These lists may be sold under the guise of clubs or monthly services. Many of these services also sell your contact information so that you become the target of numerous other companies hawking their wares. Be sure to check out any service before you sign up. If it sounds too good to be true it probably is!

While it is a shame that we have to continually be on the alert for people trying to get the best of us and our money, all we need to do is be cautious and make sure we know what we are buying and from whom we are buying it. Yes, it is possible to make money using dropshipping. But it is also possible to be taken advantage of. Buyer beware.

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Article Source: ArticlesBase.com - TAKE CAUTION BEFORE PURCHASING DROPSHIPPING SERVICES