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Drop-shipping enables you to leverage a third party"sinventory to sell goods without the costs and associated risks ofwarehousing and fulfillment. The first part of our article pointedout the various risks and rewards of drop-shipping.Now we"ll look at what you need for a successfuldrop-shipping program.
In the past, drop-shipping was riddled with manual processes.There were no simple and timely methods for retailers to maintaincontrol and visibility over drop-ship orders.
Today, automation is a must-have for a successful drop-shipmodel. Whether you develop automated technology inhouse, purchasethird-party software, or subscribe to software from an ASP,retailers must be linked to their drop-ship vendorselectronically.
Regardless of the automated system you select, it must haveflexible options to accommodate all levels of vendor sophistication- from low tech to high tech. It should also manage the lionshare of order communication and processes throughout the entirelife cycle of an order.
In other words, you should only be managing exceptions.Transactions such as order transmission, order acknowledgements,shipment notifications, invoicing, returns processing, orderchanges, customer service requests, product master updates anddelinquent vendor notifications should all be automated.
Staffing, ownership and vendor relations
Because automation eliminates the manual processes traditionallyassociated with drop-shipping, you don"t need much staff tomanage drop-ship operations.
But you must establish ownership of vendor sales relationships,overall performance, and day-to-day execution. This...