With its beginnings on E-Bay, the drop ship lifestyle became the preferred go to option for many wanting to earn online. The question now though… How will the No.1 E-Comm business evolve post Covid -19?
For some, this research could see the beginning a new career.
Looking Ahead to 2027.
In May I saw research focused on the automotive industry ( some detail here), indicating an increase in demand for auto accessories.
Currently, there are signs showing a demand for auto accessories due to the Covid -19 lock down. This includes tools, parts and things like seat covers, dash covers etc.
Also from a end of 2019 automotive report, sales in the $30 – $85,000 segment of the market were buoyant right up until the Corona virus shut down.
During the first stage of the lock down when everyone was starving, and Amazon was telling everyone how good they are, some one decided to experiment… With a car.
Could a new trend be emerging?…
Drop Shipping Cars…
E-commerce has been embraced for all manner of goods and services — books, travel, groceries, electronics, electric bikes —While auto sales have resisted the trend.
Consumers typically use the internet to browse and arm themselves with information, but they have gone to dealers for the final transactions.
While not exactly drop shipping it is opening up options in that space.
Across America and Canada, car parts are already drop shipped.
A couple of other sectors likely to perform well going forward.
The big movers going forward will be in the Bio Tech, Home security sectors, with more Hi-Tech security devices and environmental sensors for households.
I am always careful with health supplements, so many scams with them. But they are an evergreen, do it right and it is a market that will look after you year after year.
More on them later.
Formaldehyde Detectors in the household environmental niche are already selling in good numbers, without too much publicity, completely flying under the radar of most E-Comm marketers.
There are options now to include dust haze, gas, humidity and time on a household smoke alarm along with Formaldehyde and other noxious gases. Carbon Monoxide for eg.
The options available now are many, and most are portable.
The problem with in situ smoke alarms is many people disconnect them because they are too sensitive.
Going off, because you like your toast a little on the crisper side with your morning coffee.
Just what you don’t need as you psyche your self up for the day ahead.
So, moving to a portable alarm is probably not a bad idea.
Some background stuff…
Drop Ship Happenings Behind the Scenes
Not too many of us involved with E-Commerce, have ever given much thought to the workings required to get an item to a customer.
A couple of mouse clicks and our work is done. Until the customer complains.
There are changes coming.
From the perspective of your average on line E- Commerce merchant the changes that will have a negative effect, will come from legislative bodies like the EU, or some government legislation.
Some of the current legislation in various states of the USA, regarding Affiliate Marketing and Drop Shipping, is worse than a dogs breakfast.
Big guys like Amazon have governments ear, and they are not keen on too much competition.
And they always have their finger on the pulse
The first change a drop shipper may notice after Covid -19 is quicker delivery times. If the ideas currently being floated around now are any guide to by.
Lets Hope So.
The Logistics Involved in Drop Shipping and Importing in General.
And my twenty cents worth
With E-Commerce growing at an annual rate of around 19% , there needs to be a shake up of the traditional methods of getting items from supplier to customer.
This is not only International Shipping, but Domestic shipping too.
I know government has a lot to do with the rate of delivery.
Canada being the worst among the more affluent countries for imported items going to Canadians.
It is not a good look when a supplier has a list of countries they have postal ratings of.
And your position is the first below the corrupt countries. Maybe the Canadian government wanted it that way.
Corruption needs shaking out too.
As COVID-19 became a greater part of our lives, impacting postal and transport services, and everything else.
There is a definite need for small business shipping services to be more involved in the logistical role.
For example compare a small business with… Makita.
Many large manufacturers are able to have different parts made in multiple places and deliver a competitively priced product, utilising Total Loads.
A Makita Battery Drill.
The drill is made in Japan, the batteries are made in Vietnam, the battery charger is made in China. and somehow it all is packed in the one case and lands in the hardware shop at a price we can afford.
Smaller business do not have scale of production to utilise total loads. A greater use of Less than a total load (LTL), should be included in any play book post Covid -19
I know a guy from Australia, who buys a ton and a half of coffee beans from Panama every 3 months for roasting and blending with other beans he has, to use in his coffee shop and for retail sales.
A ton and a half of coffee will not fill a container.
The shipping agent will put it out there he has shipping space available. More of this is needed.
With the first- and last-mile transportation and intermodal connectivity of goods within the domestic segment of the supply chain at a standstill during the lockdown.
During the pandemic someone was taking a careful look at how these processes might be better utilised in the future.
And Business’s re -evaluating their minimum buy and sell quantities.
A re-evaluation of the movement of supplies that is proportional to the increase in the cost of commodities would be beneficial to all concerned.
Go here to view a White Paper on the Disrupted Supply Chain.
What Happens to the Drop Ship Lifestyle Now?
Obviously there will be a shift. Many people say China will be out of the equation because of the Corona Virus.
It will never be completely out of the any trade equation. Washington say’s China “stole” intellectual property. That is true of many companies in many countries.
Unless your trading in heavy industrial products, the effect on the average drop shipper is negligible.
As I said above, governments are the drop shippers second biggest enemy, Big companies wanting monopolies are the biggest.
Drop Shipping Competition, Revolves Around These Most of the Time…
Toys, Hobby and DIY, Furniture and Appliances, Food and Personal Care, Electronics and Media, Fashion.
Much of which comes out of China. Did you know…
Many electrical items have their data boards made in Malaysia, or Switzerland?
Many watches have their mechanisms made in Japan?
There is a lot of ignorance out there. China is just a location.
Some satire Here.
Best to look past the ignorance if your at all interested in this business.
What about Drop Ship Software?
I have not mentioned Oblero or Spocket. More on those two in another post.
Shopify. I think everyone has heard of. It is not really a software company anyway. It has Oblero which is hardly cutting edge technology.
The two I have highlighted fly pretty much under the radar for most people.
However they are serious players. Salehoo has been around since back when E-Bay was getting going.
A review on it Here.
Most people think AliDropship is a new player. The only thing recent about it is the software!
The owners have been involved with drop shipping for many years. Using it as a means to pay their way through University.
Studying Internet technology!
An article can be seen Here.
My Top Products
All of those mentioned above… And Supplement Dropshipping.
The ultimate consumable. Do this right and the customer return for more product, and if you are doing your marketing right, they will try any new products you may have.
Repeat orders not only depend on you doing your part…
You will need an easy to market product, supplied by a reputable manufacturer, who runs an efficient business.
Dealing with just one supplier for your supplements and dropshipping needs, you will save a ton of time and money and reduce the scope for errors.
Preferably well established in the industry – nothing offers peace of mind more than years of industry experience, backed up by customer reviews.
I mentioned AliDropship as new player earlier.
They are so far ahead of the curve, their plugin works with both English and Spanish.
In the countries below North America there are about 500 million(?) people
There are some rules to drop shipping to South America, and most of it relates to the supply chain.
Suppliers rely on their logistical support for freight costs and entry. Check with your suppliers to make sure they are comfortable shipping to South America, If you want to enter this market.
I had one who was happy shipping to England and the USA, One day I had an order for two pair of sneakers from Ecuador.
I checked with the supplier before passing over the money, and Yes, he was ok to ship to South America.
I had a sale, and he must not have checked his freight charges properly. He refused to send it.
I managed to find similar items. But lets say I never made any money on that transaction. A few weeks later I got more sales from that area.
By then I had managed to have sourced another supplier whose logistics were better organised. And made some money on those transactions.
The other supplier still sends me emails about his sales specials… 😎
Some suppliers will only ship to selected countries. It may pay to ask twice! This is experience talking.
Payment processors. will be important. If you intend to test this market spend some time on getting set up.
I was able to transact in Ecuador and Colombia using PayPal. But that is more the exception than the rule. Generally people who have PayPal in South America, have spent time in the USA or Europe.
Aliexpress I still had to use a credit / debit card. (as always).
The only items I have had problems with is Jewelry. On a $400.00, order the customer paid 20% tax in Colombia. It is classified as a luxury item.
But experienced drop shippers know to add… “Customs duties to be paid by the customer ” on their terms of trade.
People are looking away from China. I dislike politics, but to calm China, Trump would have to go, and China can continue doing what it feels like.
It the Trump is returned, America will turn further inward. But… they are business orientated, so deals will be struck ! An abundance for all right?
However there is still a lot of ignorance and prejudice about trade out there.
The drop ship lifestyle will survive and the array of products available online will only increase in quality and availability, as more countries open up to trading.
Till next time.
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