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SaleHoo Wholesale Dropshipping – Calculating Realistic Costs of Wholesale Dropshipping Business

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Entrepreneurial wisdom dictates that we be fully aware of the costs we will have to pay for before going into business. In the same way, we need to have a concrete estimate of costs before we decide to invest in wholesale dropshipping. Do your homework and complete a research or study on companies that offer wholesale dropshipping services. There are some wholesale companies which do not offer wholesale dropshipping and so if you find one who does, they may offer this service for an additional cost. Of course, you increase your potential profit if you find a wholesale company offering dropshipping services without an additional cost. Some companies may even ask you to pay for membership which will be readily returned as soon as you have reached an agreed amount of purchases.

Why is it important to be fully aware of such costs? This is so you can accurately forecast the income you will be earning. This way, you will also know if you are starting up a business that will help you earn extra or give you another source of expenditure. Imagine if you partner with a company that will ask you to pay membership on a monthly basis, then this cost will be a regular dent on your monthly profit. Make sure you will have a way to keep track all your monthly expenses, like have a software to use to record all business costs and all earned profits. Record all costs for each item, delivery charges, overhead business expenses such as tax, if there will be any. If you will be delivering to a customer off a key location, ask if there will be a special charge for it. Confirm additional costs for packaging, if there will be any.

Before inking a contract with a dropshipper, ask if they accept returns, if there will be a problem with any of the delivered items. If they do, please confirm the timeframe conditions attached with a valid return. If the company you are transacting with does not accept returns, then anticipate a possible deduction on your profit or business cost in shouldering another purchase for the same item. This way, you can anticipate an accurate value for your expected monthly profit.

Other than returns, make sure that you are also signing in with a damaged merchandise policy. Some wholesale dropshipping companies still accept items that have been opened or in any way damaged during delivery, provided that you have signed up for a policy that covers it. Make sure that you get all these policies in black and white should you ever need to make a claim. Again, if there is no such policy, this will have to be considered as a potential cost for your business.



Source by Shakira N. Smith

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