How to Negotiate with Dropshipping Suppliers the Right Way

Photo by Ben White on Unsplash

Finding the right supplier is crucial in dropshipping products. As a drop shipper, you must be careful in choosing a supplier to source your products from because the reputation of your dropshipping business is at stake here. Although you can just list down the products of any suppliers on your website and just contact them when you got orders, this does not guarantee the quality of the products and the speed of shipping to the customers. So I created this quick guide to help you find trustworthy suppliers and learn the steps to take when negotiating with dropshipping suppliers.

Dropshipping is a risky business because you have less control over the handling and delivery of ordered products to the customer. You cannot guarantee the accuracy and quality of the products, the safety of the packaging and shipping, as well as the length of time it will take to ship the package from the supplier’s location to the customer’s mailing address. Only when the customer provides feedback about his order that you’ll be able to know if the supplier fulfilled his end of the business.

Photo by Andre Hunter on Unsplash

Many things can go wrong when dropshipping products, especially from overseas suppliers. The fault might be on the supplier’s side but it’s not the supplier that customers will blame — it will be you who sold the products to them in the first place.

These are the common issues that may arise with dropshipped products:

1. Bad product packaging
2. Late dispatch of the package
3. Delivery delayed by customs
4. Damage in product during shipping
5. Lost package during shipping
6. Wrong info about shipping service
7. Delivered package in the wrong address
8. Advertising materials shipped inside the package that are not related to purchased product

To reduce the risk of these issues to happen, you should assess first the reputation and capability of your potential suppliers before you dropship from them. How do you do that? Look for the following characteristics or qualifications!

The supplier has been in the dropshipping business for a while. This gives you the confidence to do business with them because they have the strength, stability, experience, and systems to handle a huge volume of orders.

They stand out over their competitors. Let the supplier pitch about their strengths and compare them against the data that you’re able to collect about the supplier. When you do your research, you’ll be able to check if the info the supplier provided is correct.

The supplier can process the order within 2–3 days. This is the standard order processing time. If they can do it even on weekends and holidays, much better.

Photo by Alex Mecl on Unsplash

More than one shipping methods available for customers. The best supplier can ship the products using sea transport, air freight, and express at discounted shipping rates.

Photo by RENAN SAVIDAN on Unsplash

The supplier has an integrated data feed system. The stock levels must be up to date between you and the dropshipping supplier. This is to ensure that your customers can precisely know the availability of your products so they can immediately decide which items to purchase.

Photo by Roberto Cortese on Unsplash

More favorable and reasonable refund and returns policy. Returns are normal and unavoidable in a dropshipping business. Whether you retain or lose your customer forever depends on the supplier’s ability to handle returns.

Photo by 🇨🇭 Claudio Schwarz | @purzlbaum on Unsplash

There’s a quicker method of finding reliable suppliers — and that’s through a Product Mafia subscription that will give you access to winning products and their suppliers. Once you have decided on which dropshipping supplier you’ll be transacting with, the negotiation process follows.

If you are not used to negotiating with suppliers, chances are, you’ll just accept whatever prices and terms they will offer you. This is not a good strategy for your dropshipping business. You must negotiate with the suppliers to get high markups when you start selling their goods. Here are the steps you could follow to ensure that both you and the supplier can benefit from the deal.

Photo by Austin Distel on Unsplash

1. Always ask questions. Don’t make the mistake of accepting the first price that the suppliers offer. You’ll never upset suppliers with your questions because this is a common practice in their business. Ask if the price is negotiable and they will soon tell you if it’s not. You’ll never know this if you don’t ask.
2. Deal with a supplier professionally. Negotiate with the supplier in a business-like manner. Present your reasons why the supplier should give you a better deal. Tell them the advantages that your business can bring them if they agree to your proposal.
3. Focus on other things to negotiate, not just prices. You should have other things to propose as a deal especially if the supplier’s prices are non-negotiable. This can be an extension of the payment terms, faster shipping, and so on. Discounted product prices are great but if you can negotiate other parts of the deal that would be more beneficial for you and the supplier is willing to agree on, the better.
4. Ask about upfront bulk ordering. Although most suppliers don’t set minimum order for their products and you’ll only pay them after selling the item, it might be better if you order the products in bulk. They might be amenable to holding on to your stock and ship it every time you have an order. You might also be able to negotiate lower shipping fees when you do.
5. Ensure that the deal will be a win-win for both parties. The deal should benefit you and the supplier as well. You wouldn’t want to have them commit to a much cheaper price but they will cut corners elsewhere like the quality of the products, the speed of delivery, etc.
6. Renegotiate regularly. Negotiating with the supplier should not be done for one time only. Revisit the agreement regularly to look for ways to upgrade your deals with your dropshipping suppliers.

Final Words

Looking for reputable dropshipping suppliers is tedious and time-consuming. Yet this is an important part of dropshipping that you should never forego because the supplier represents your business in terms of shipping the items to your customers. Product Mafia can help you find winning products and suppliers fast through a free or pro subscription. All that’s left to do is negotiate with these suppliers using the steps I have discussed in this article.