Going global: ROI in web-to-print and dropshipping
When does it make sense to use dropshipping services? Web-to-print and fulfillment experts Printful give us their top tips for expanding into global markets.
Margins with dropshipping tend to be smaller, so do you need to sell many more items to run a profitable business?
Margins vary based on products and we have some products with high margins. However, we strive to offer the highest quality-products to our customers, and with the right branding/messaging, customers can position themselves as selling premium products, so they can then charge more and increase margins.
What are typical volumes required for running a business to generate the equivalent of full-time pay?
We have seen plenty of customers who have turned their side hustles with Printful into full-time jobs.
When dropshipping, how do you ensure the quality of the product meets market expectations?
All our orders go through a three-step quality check before we ship them out. We use software that checks the graphics before we print or embroider them, our fulfillment specialists continuously monitor the production process, and there’s also a final quality check after a product is ready to be shipped out.
Why should a printer add dropshipping to their portfolio? What are the margins/return on investment like?
Adding a dropshipping service expands your market to include sellers that can’t keep inventory, and lets sellers run their business without having to worry about any of the logistics. Through dropshipping you also provide a certain level of risk management to sellers since they no longer have to manage unsold stock. Dropshipping can help you make the transition from being a printing company to a one-stop shop for sellers, making your services more accessible.
How is dropshipping a threat to local businesses and how can they combat it – is it a case of simply being aware of what the customer can get online (eg far cheaper business cards)?
Global and local printing companies tend to serve slightly different customer bases. End consumers may only be concerned about shipping times and fees, but sellers have a variety of needs that require different approaches. Local businesses can usually provide faster shipping times, lower shipping costs and a more tailored service to their sellers. They understand the specifics of their area and can respond quickly to local market changes. Global printing companies like Printful have to fragment their attention and localise their messaging, which is hard to get right. We are a better fit for customers that need global shipping, or customers that don’t have local printing businesses available to them.
What are the pitfalls and hidden costs of dropshipping?
By using dropshipping services, customers are giving away a considerable amount of control that they used to have over the shipping process, packaging, and product quality control. You need to be aware of that and be responsible for maintaining a good reputation for your customers. Additionally, you will have to deal with customer returns since some of your sellers will probably not have the capacity to store or properly dispose of them. You may also have to think about introducing more branding options to your packaging, since some sellers will consider that a deal-breaker.
If you have several facilities, it also creates extra expenses and waste due to shipping and packaging. If an end customer orders multiple items that are fulfilled in different locations, those items will come separately and at different times. We are trying to mitigate that by reducing unnecessary packaging and encouraging our sellers to choose products that can be fulfilled in one market, but any dropshipper with multiple locations will have to face this issue.
So those who want to get into dropshipping need a strong, developed sense of their market?
In order to succeed, you need to know who your customers are and what their needs may be. If you try serving a market that you don’t know anything about, you won’t know what to focus on or how to compete in that space. I think it’s better to stick to what you know and do continuous research, especially if you’re only starting out with dropshipping.
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