3 Ways Vendor Drop Shipping can Save Retailers Time & Effort while Increasing Sales

By Ian Goldman | CEO Celerant Technology

deliveryWhen a customer makes a purchase on your website they choose their products, login or proceed as a guest, enter their shipping and payment information, and expect their products to be delivered in just a few days. What the shopper doesn’t see is the work that goes into making that order happen. They place the order online and “poof” expect it to magically appear on their doorstep. Customers don’t see the planning, coordination, and timing it takes to make the order happen.    

Order fulfillment can be challenging, especially when you are fulfilling orders from multiple channels and from multiple fulfillment locations. There are systems available to help streamline these processes, such as ‘best store’ fulfillment tools in which your system automatically selects the optimal location to ship from based on pre-determined factors, but let’s face it- efficient fulfillment is difficult. Most SMB retailers don’t have large warehouses or DCs to stock their merchandise or the internal resources to effectively pick, pack and ship orders the same day.  So why not lean on your distributors who do?  In the evolving retail market, savvy retailers are adopting newer methods in order to better serve their customers and meet their ever growing expectations. Most distributors, combined with your retail management technology provider, will allow you to sell their products on your website, without stocking the merchandise, and they handle the fulfillment from their warehouse on your behalf.  The result is you as the retailer can offer more products, that can be fulfilled faster- all with your branding- and you have happier customers.  The concept seems simple, so let’s take a deeper look.

Through vendor drop shipping retailers never see the products they are selling, the vendor is in charge of selling, stocking and delivering the products to customers. You see which products are available through live online vendor feeds, purchase inventory to the products you want to sell. Once a product is sold the order is completed by the vendor and you no longer have to deal with the planning and coordination of delivering products saving you time, money and effort.

Stock Less Inventory

While there are products you need to stock for your brick and mortar store, which hopefully you are starting to purchase electronically through automated purchase orders within your retail system, when we talk about online sales- most products you won’t need to stock at all.  With the right technology, retailers can pull live online feeds from their distributors- showing products, descriptions, 360 degree images, and most importantly, available inventory levels from their warehouse.  Customer orders on your website can then be sent directly to your distributor to fulfill on your behalf.  

Offer More Products

By leveraging this technology, retailers are able to sell many more products and much wider product lines on their websites.  Traditionally, merchants only sell what they have in stock and bringing in stock ‘just in time’ has always been a challenge to minimize dreaded overstocks and understocks.  By pulling live vendor inventory feeds and allowing your distributor to fulfill your orders from their well-stocked warehouses, overhead and manpower needed for picking, packing and shipping are significantly decreased if not eliminated.

Keep Customers Happy

In today’s world retailers need to continuously be extending product lines to keep customers engaged and reduce the chances they will start looking elsewhere. Perhaps even more importantly, retailers need to think of new ways to get their orders out the door faster to meet (or hopefully exceed) their customers fulfillment expectations.  Retailers can achieve this by better leveraging their vendors and their extensive resources.

With the right technology, vendor drop shipping is an easy yet effective way for retailers to streamline their processes. The ability to stock less inventory and offer more products, with less work and happier customers might have once sounded impossible. The savvy retailers are learning to evolve and take advantage of innovative technology, enabling them to more effectively operate their business to stay at the forefront of the industry.

About the Author:
Ian Goldman, President and CEO of Celerant Technology, is an expert software engineer with 25 years of experience developing advanced management solutions that offer integrated omnichannel capabilities for progressive retailers.

 

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