Dropshipping

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Raeel
Tourist
3 0 0

I am just starting and I am a little confused on the payments. Do I have to pay the company before they will ship or does what the customer pays, go to them and then ship? Thank you for any help

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Helen
Shopify Staff
Shopify Staff
1093 128 178

Hey, @Raeel. That’s a great question! The dropshipping business model can be difficult to wrap your head around at first, so it’s a good idea to gain a better understanding of it before launching your store.

 

To answer your question, in terms of payments, you will need to pay your supplier for the item your customer orders before they will ship it. Essentially you are the “middleman” in a dropshipping scenario: Your customer purchases from you first, then you purchase the same items from the supplier on your customer’s behalf.

 

The profit you make comes from the difference in price that your customer pays you, and what you pay the supplier. For example: 

 

Supplier’s price of an item = $10.00 

The price on your store (ie. what your customer pays) = $15.00

Your profit = $5.00

 

You get to decide the price at which you set the products to be on your store, so you’re in charge of the profit you’ll make. Does that make sense?

 

We have a lot of resources available to help you learn more about dropshipping. I recommend starting with these:

 

 

What kind of products will you be selling? Have you given any thought to your marketing plan yet? The Best Dropshipping Products To Sell In 2021 (And Ideas To Market Them) is full of inspiration if you’re still in the planning phase. I recommend giving it a read through as well.

 

I hope this information helps! If you have any other questions, or want to continue to discuss dropshipping in general, just let me know. Good luck!

 

 

Helen | Social Care @ Shopify 
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Raeel
Tourist
3 0 0
Thank you so much. I listened to a few of the videos after posting
this..lol He pretty much answered it and then some. Thanks for taking the
time to help me out.
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Helen
Shopify Staff
Shopify Staff
1093 128 178

No problem, @Raeel! I’m happy to help.

 

That’s great to hear you found the answers you needed. Which video did you watch? If you haven’t seen it yet, the Shopify channel on Youtube also has a ton of videos for starting and growing your business. Check it out!

Helen | Social Care @ Shopify 
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 - Was your question answered? Mark it as an Accepted Solution
 - To learn more visit the Shopify Help Center or the Shopify Blog

freya0328
Explorer
123 1 14

This needs to be discussed in detail with the company you are cooperating with. Some companies require payment in advance, and some companies support cash on delivery.

Hi @Raeel 

The Customer Pays you.

You keep your profit and pay the supplier.

Supplier delivers directly to the customer. 

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Raeel
Tourist
3 0 0
Hi, Thank you. If I may ask, how long in your case, does it take to get
customer pymt to your financial institution? Im just worried about that and
not having enough to cover one day.
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Helen
Shopify Staff
Shopify Staff
1093 128 178

This is an accepted solution.

That’s a valid concern, @Raeel. The length of time it takes to receive your payouts will depend on the payment provider you are using. Which payment gateway are you using on your store? If it’s a third party gateway, please contact your provider directly to discuss their payout schedules.

 

However, if you’re using Shopify Payments, then you can set up a payment schedule in your admin by going to ‘Settings > Payments > Manage’. Keep in mind though, that it can take 24-72 hours for your bank to process your payouts, so even if you set your payout to every business day, the funds may not be available until a few days later. For more information and expected timelines, please see the Help Doc for Getting Paid with Shopify Payments.

 

There are also some good tips about finances when dropshipping in the blog on How to Start a Dropshipping Business. One of the recommendations is to have a business credit card to use strictly for inventory purchases from your supplier. This way you’re able to place the order for your customer as soon as possible, and don’t have to wait to receive the payout from their purchase before completing the transaction.

 

Hope this helps!

Helen | Social Care @ Shopify 
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Hello @Raeel 

First customer will  purchase  products from your store ,then you have to place order to your customer from your supplier sites.

In dropshipping customer will order from your store, were you have to send  order details to suppliers who directly send to customers. Here i can suggest you supplier from where you can import products directly to your store. 

Thanks
Tuecus 

Apps Developer Team |@Tuecus-Customer Page
@Aliexpress Dropshipping & More
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InsureShieldApp
Tourist
6 1 1

Hi @Raeel 

You also may want to consider shipping insurance as part of your drop shipping strategy. Sometimes, third party merchants will have a delay in shipping or send a damaged package. When that happens, you're responsible for filing a claim and making sure your customers are satisfied. InsureShield provides coverage for multi carriers, so whoever you're shipping with, your packages are covered for loss, damage or theft! All products ordered and shipped from your Shopify store will be covered. We also offer multi-carrier, multi-modal coverage. 

Check us out and tell us what you think: https://upscapital.com/ShopifyApp/