Dropshipping is a revolutionary business model that has changed how businesses operate and make money. It’s an e-commerce strategy where a vendor sells products without holding any physical inventory while relying on a third party to ship and fulfill orders.
While this business model has made millionaires over the years, online marketplaces like Amazon and Walmart have since introduced policies that make it difficult to dropship the conventional way without getting banned or terminated. This has left many questioning if dropshipping is even worth it, or, better still, if there is a solution to these restrictive policies.
If you have this question in mind, or you struggle with account suspensions due to the restrictive nature of traditional dropshipping then you should consider Two Step Dropshipping. This dropshipping model is a revolutionary business solution that can solve the common problem of account suspensions.
In this blog, we’ll explore the benefits of two step dropshipping, what it is, and how it offers a solution for dropshippers who have faced suspensions and terminations with traditional dropshipping. Whether you’re an experienced dropshipper or just starting out, two step dropshipping is the way to take your business to the next level while avoiding pitfalls.
Brief Overview of the Traditional Dropshipping Method
Conventional dropshipping, as we know it, is a retail fulfillment method where a store doesn’t keep the products it sells in stock. Instead, when a store sells a product, it purchases the item from a third-party supplier and has it shipped directly to the customer. As a result, the vendor never sees or handles the product.
In this business model, the store acts as a middleman between the customer and the supplier. The online store is responsible for marketing and selling the products, while the supplier handles the storage, packaging, and shipping of the products. The store earns a profit by marking up the price of the products it sells.
Here are some advantages of traditional dropshipping:
- Low overhead costs as you won’t need to handle any stock: With low overhead, entrepreneurs can focus their efforts on growth instead of worrying about inventory.
- Easy setup process with limited resources: It takes only an internet connection and a few essential tools to get started with traditional dropshipping.
- Ability to scale quickly without worrying about storage space: Because there’s no need to store inventory, businesses can snowball without worrying about storage space.
Problems with the Traditional Dropshipping Method
The traditional dropshipping method is the old-fashioned way of doing things. Over time, marketplaces have released highly restrictive policies regarding this type of dropshipping. As an Amazon seller, for example, you cannot ship items with another retailer’s logo to your customers as it will get you banned or suspended on Amazon.
This makes sense because online marketplaces like Amazon prioritize their brand identity and customer experience. They wouldn’t want an order coming from their store to appear in a Target or any other retailer’s/supplier’s packaging.
This policy alone poses a huge problem to conventional dropshipping because that would mean you cannot source products from some of these suppliers that deliver with their packaging. This is just one of the problems with with traditional dropshipping. There are other problems with this traditional dropshipping model including:
More Angry, Confused Customers
More angry, confused customers can be found with the traditional dropshipping method. Let’s give an example. Say your customer tries to buy beddings from your Amazon store.
You decide to buy your package from Bed Bath & Beyond and ship it to the customer directly – the conventional way.
If the customer receives the package and sees that the bedding is in a Bed Bath & Beyond box, they may research that product and realize that you bought it for much cheaper and then shipped it to them. This can anger them and can lead to other disputes like refunds.
Monitored Growth = Slower Growth
Some marketplaces like Walmart monitors how quickly sales are made from the traditional dropshippers they currently have on their website. That means dropshippers must be careful to grow their business slowly. Otherwise, Walmart may flag them for being a scalper.
2-Step Dropshipping — The Solution
In eCommerce, two step dropshipping has emerged as one of the most innovative and popular methods for entrepreneurs to expand their businesses.
Two step dropshipping, also referred to as 2-step dropshipping, utilizes a two-step process to facilitate the sales of products from wholesalers, or retailers, to customers without any inventory management on the merchant’s part. With two-step dropshipping, merchants can focus more on marketing and customer service than ever.
What is Two Step Dropshipping?
Two step dropshipping is a method of fulfilling orders in the dropshipping business model. In traditional dropshipping, the supplier ships the product directly to the customer, but in two step dropshipping, the supplier ships the product to the dropshipper or a third-party warehouse, who then ships the product to the customer.
Having this third-party warehouse as an intermediary adds an extra layer of security, as it eliminates any potential policy issues that can affect your account.
Advantages of Two Step Dropshipping
This method offers several advantages, including increased control over the customer experience and a more streamlined fulfillment process. Here are some advantages that 2-step dropshipping offers:
- Reduced risk of account suspensions: Third-party warehouses can remove the packaging of the supplier so it doesn’t get to the customer. Also, since the delivery will be coming from the warehouse, the invoice will reflect that of the warehouse and not the supplier. These logistics ensure you are in compliance with the terms of service of most online marketplaces, thereby reducing your risk of account suspensions and terminations.
- No monitored growth: Two step dropshipping allows your business to soar without worrying about being flagged by Walmart or other large retailers that may monitor your business’ growth rate. In addition, because your package goes to an intermediary, it makes it harder for marketplaces like Walmart to track it.
- More control: Two step dropshipping allows the dropshipper to have more control over the customer experience, including the packaging and branding of the product. This can help to build a stronger brand identity and increase customer loyalty. Additionally, two step dropshipping can also provide the opportunity for the dropshipper to add value to the product, such as through custom packaging or a personalized note.
- Increased customer satisfaction: By adding an extra step to the shipping process, two-step dropshipping eliminates customer confusion or anger from receiving packages from third-party websites.
- More time to focus on marketing and customer service: 2-step dropshipping makes it easier for entrepreneurs to focus on growing their businesses instead of worrying about inventory management.
Ecom Circles’ 2-Step Dropshipping
So, have we made you interested in two step dropshipping yet? Good! Then it’s time to tell you about Ecom Circles’ 2-step dropshipping approach.
With our 2-step dropshipping approach, we help our customers thrive and adapt to the market. We’ll help you by:
- Equipping your Amazon or Walmart marketplace settings with our two step dropshipping: You’ll be able to use our two-step dropshipping process to get your products to customers faster and more securely.
- Listing your items and keeping track of your stock and prices in our system and on our platform: Our two step process will enable us to easily and quickly update your products on the Amazon or Walmart marketplaces, ensuring customers get the best prices possible.
- Placing and shipping orders as they come into one of our integrated warehouses: We’ll take care of the entire logistics process, from identifying and shipping orders to ensuring they are delivered on time and in perfect condition.
- Tracking your item the entire way to our warehouse: You’ll get alerts if your item is canceled or lost in transit.
- Removing the branded packaging and any invoices when our warehouse receives the order: We’ll then repack the item in an unmarked box before shipping it to the customer. That means customers won’t see the product coming from a third party company and will be more likely to trust your business.
- Adding the tracking number back to Amazon or Walmart for you and adding all costs to your profit and loss statement: We’ll make sure that you have all the information necessary to track and monitor your two step dropshipping process.
- Repeating these steps as necessary to help grow your business without any risk of violations, suspensions, or termination: Every two-step dropshipping process we set up adheres to Amazon, Walmart, and other marketplaces’ rules. So, if you’re looking for a reliable 2-step dropshipping solution to help you succeed in the e-commerce world, then Ecom Circles is here to provide you with all the tools and resources you need.
As you can see, two-step dropshipping offers several advantages for entrepreneurs looking to expand their business in 2023. With Ecom Circles 2-step dropshipping, you get all these advantages plus a secure and seamless two step process with dedicated customer service.
We’re committed to helping our customers succeed and ensuring they are equipped with the tools they need. Set up a call with us today to learn more about how Ecom Circles’ 2-step dropshipping approach can help grow your business!