I recently launched my new online food & products store - a bit of a 'passion project' / huge potential to be great!
So basically I started with my 'in-stock' items. Then I started adding 'drop-shippers', (local companies throughout the country).
I have set them up as fulfillment services, linked to their products - so if an item sells they get an email.
I only charge 1 shipping fee..
So if a customer buys 1 products that is fine, shipping is paid for. If they buy 2 products then I have to cover the shipping (on average $6.50). So what I have been trying to do is make sure that my wholesale profit is higher than shipping so I am always making a profit no matter what, just say it could be $7.50 (wholesale profit) - $6.50 (shipping) = $1 made on that order. But then if they buy more from that same seller I don't have to re-add in shipping that would purely be wholesale profit.
For many items I might be making less than shipping - in these cases I am doubling or tripling up the item and putting it on as a bulk item (e.g x3 coconut oil bottles). This is okay but not ideal for many items.
I feel I need to work out what I should do here.
I am at a bit of a cross roads:
Do I stay as 'one store with in-stock items and drop-shippers' or do I turn into a 'marketplace' using the 'multi-vendor' app. Currently just added this app but yet to do anything on it in my confusion.
I plan to connect all like-minded suppliers throughout the country on the site one way or another. I keep thinking how does Amazon work? What set-up do they have with vendors and shipping fees.
We are getting great feed-back.
I don't want my customers to get to checkout with a $50 shipping fee if they buy from 5 suppliers so can't do this. I don't want to only put on bulk items for low margin items. What control would I have with the Marketplace app? Is it better to create your own marketplace or stay as 'one store with drop-shippers'. I kind of want to still be a 'store' so to speak. Is Amazon a store or a marketplace? I also can't really track any of my drop-shippers inventory at the moment, they are meant to 'update me' when something is out of stock but I don't think they always do. It is fine in these early days but probably would be very difficult in a few years.
Thanks so much for reading this long message and look forward to any advice you may have.
Country: New Zealand