Dropshipping 101: Best Dropshipping Companies | SMB Compass
Ezra Cabrera | March 29, 2021
Key Takeaways
- Dropshipping is a process of selling products without actually keeping some in stock. The seller receives an order form the customer, then orders the products to the supplier, and the supplier confirms and ships the product directly to the customers.
- When looking for a dropshipping company and finding what is the best dropshipping company, there are five things to consider.
- We’ve narrowed down the best dropshippping companies to work with.
For entrepreneurs and business owners looking to start their eCommerce journey, dropshipping may be a business model worth investing in. It’s low-risk, flexible, easy to manage, affords access to wholesale suppliers, and doesn’t require a significant amount of capital to start selling. That’s why it’s vital to work with the best dropshipping companies out there.
Finding the right dropshipping company to work with can be challenging as there are thousands of options to choose from. We’ve gone ahead and done this work for you. In this article, we’ve broken down what dropshipping is and compiled what we believe are the best dropshipping companies out there.
What is Dropshipping and How Does It Work?
Dropshipping is a retail model wherein the seller doesn’t keep any products in stock. Instead, they order the products purchased by their customers from a dropshipping supplier, and that supplier ships the products to the customers directly. This is great for new entrepreneurs with limited capital as you won’t need to spend any upfront on wholesale products.
Dropshipping involves three key players, namely:
- Customer
- Merchant
- Third-party dropshipping supplier
It’s up to the merchant to find a dropshipping company it wants to work with to sell its products and form an agreement with said company. Once a customer places an order through the merchant’s eCommerce store, the merchant must notify the dropshipping supplier of the purchase order details – customer name, address, contact number, etc. The supplier then fulfills the order and ships it directly to the customer.
Though the merchant is the entity selling the products, it never actually has direct contact with those products. It simply accepts the orders and notifies the supplier.
How to Find the Best Dropshipping Companies and Suppliers
If you’re going to work with a dropshipping company, it’s important to choose one that understands your company’s immediate needs as well as your long-term goals. In order to find that third-party supplier that will best meet the demands and needs of your business, you need to know what to look for.
Here are five factors to consider when searching for the best dropshipping companies to partner with:
1. Product quality
Dropshipping is a product-based business. When it comes to choosing a supplier, your top priority should be finding one that offers quality products at a reasonable price. Better quality products translate to higher rates of customer satisfaction, and when you are able to price them reasonably, it increases your ability to attract new customers. Remember, the retail price you offer customers will be dependent on the wholesale price your supplier offers you.
2. Location
The United States is a big country. Since the dropshipping company you work with will be the entity that physically ships your products to your customers, you’ll want to consider where in the country they are located. Generally, a supplier located more centrally – in the middle of the country – can get packages to any location within a reasonable timeframe. Suppliers located on either coast can’t get products to customers on the opposite side of the country as quickly as a more central supplier can. It ultimately boils down to providing convenience for your customers.
3. Efficiency
Efficiency is certainly key when it comes to a dropshipping company. You need a partner that you, the merchant, can trust to handle and package your products with care and ensure that they arrive at your customers in a timely manner. Here are questions you should be asking:
- How fast do they typically ship out products? What is their average timeframe from the date the order is received to the date the order is shipped?
- What is their process for handling orders? How are they packaged and packed for shipping?
- What is their timeframe for following up with tracking information and invoices?
The best way to truly get the answers to these questions is by physically working with a company. If you can, place a few test orders with the partners who you are considering to see for yourself how they handle it. After a few test orders, you can now answer your questions like is Doba a good dropshipper? Is Salehoo better than Megagoods? Which has better service among all the companies? This will help you assess the companies better.
4. Staff Expertise
Since your livelihood and the success of your eCommerce business relies, in part, on your supplier’s participation in your operations, it’s important that you choose a company with a knowledgeable staff and sales representatives who are available to answer any and all of your questions as they arise – be it about products, packaging, processes, etc.
5. Customer Service
Lastly, you’ll want to choose a dropshipping company with excellent customer service. The same way you want the company to be knowledgeable and accessible to address any of your questions and concerns, you want the same for your customers. If there are issues like product damages, delays in shipping, etc. you’ll need a partner who can handle and amend them professionally and in a timely manner to avoid negative customer experiences.
Best Dropshipping Companies to Work With
Here is a list of, what we think, are the top six dropshipping companies to help grow your eCommerce business:
1. Doba
Is Doba a good dropshipper? Well, Doba is one of the most comprehensive dropshipping marketplaces for eCommerce stores. It offers upwards of two million products sourced from different sellers, which dropshipping merchants can connect with. Doba will also contact the suppliers themselves. Once the suppliers confirm the orders, the platform will send the products to the dropshipper’s customers.
Typically, dropshippers will have to partner with more than 20+ suppliers, but with Doba, you can find all the products you need in one place. You certainly have the choice to source your products from multiple suppliers, but getting it all on one platform will save you a lot of time and effort. Just log into your account, find your products, list them on your website, and start selling.
Doba is compatible with a lot of eCommerce platforms. Whether you’re at BigCommerce, Shopify, Magento, or other media, you can integrate Doba into your store, making the product listing process much more manageable.
Doba is also one of the most affordable dropshipping suppliers. Here’s an overview of their pricing plans:
Basic – $29/month
- Advanced – $69/month
- Pro – $249/month
The platform does offer a free two-month period when you sign up for one of its annual plans. There’s also a one-month free trial period for people who are still on the fence about it.
2. Oberlo
Oberlo works exclusively with eCommerce businesses that sell through Shopify stores. It is considered the best dropshipping company for retailers using Shopify as their main eCommerce platform and markets itself as the top marketplace to find products and sell them in your Shopify store. That said, if you do not use Shopify to sell your products online, this will not be the right dropshipping supplier for you.
Oberlo connects merchants to suppliers, who then ship the products directly to the customers. The platform allows retailers to sift through millions of products and even gain access to specific niches – be it jewelry, clothing, electronics, and more.
Oberlo offers a free plan, which is perfect for people who are still testing the waters. However, if you want to maximize its features, you’re better off with their paid plans. Starting at $29.99 per month, you’ll gain access to features like unlimited monthly orders, bulk orders from customers, real-time parcel tracking, access to eBooks and other learning materials, among others.
3. Wholesale 2B
Wholesale 2B is on this list because of its unlimited order processing feature. Merchants can choose from over a million products to list on their eCommerce stores. Plus, the company has a lot of app integrations. Whether you’re selling at Shopify, WooCommerce, BigCommerce, Amazon, eBay, or Magento, you can trust Wholesale 2B to help you deliver products to your customers.
Wholesale 2B also provides an easier and hassle-free way of processing orders. You can sync the app with your eCommerce store. Once a customer buys a product from you, it’s automatically imported to Wholesale 2B. The company processes the order, ships it, and takes a percentage of the sales as their commission.
Other benefits of Wholesale 2B include:
- Free sign up
- Easy to use
- Diverse product selection from different niches and merchants
- Free sign up
The pricing typically depends on the eCommerce platform that the merchant is using to sell their products. For instance, BigCommerce users will have to pay $29.99 per month. You can also opt for their annual subscription for $149.99.
See article: Wholesale Financing
4. SaleHoo
Having been around for more than 15 years, SaleHoo has become one of the best dropshipping companies. They offer over 2.5 million products sourced from 8,000+ suppliers. Once you sign up on SaleHoo, you can immediately start listing products on your website and selling them.
Here are the features that make SaleHoo a highly recommended dropshipping supplier:
- An advanced product research tool that shows hot and highly profitable items
- Unlimited dropshipping learning tools and training
- Verified suppliers
- Online store automation
- Backed by 60-day money-back guaranteed plans
- Award-winning customer service
These features can only be accessed with a SaleHoo membership, and the company does not offer a free trial period, unlike other companies on this list. That said, SaleHoo does offer fantastic deals for subscriptions. Its one-year membership costs $67, and a lifetime membership is just $127.
5. Sunrise Wholesale
Sunrise Wholesale is best for people who want to have full control over their customers’ orders. It allows you to manually place your customer’s order on the platform and confirm the order before it shipped.
While some may prefer platforms that import orders directly from their eCommerce store to the platform, this extra step in Sunrise Wholesale adds assurance for merchants who want to keep an eye on every aspect of their business.
A standout feature Sunrise Wholesale offers is its Amazon research tool, which helps business owners find products that are currently on-trend. The company also offers another listing tool for dropshippers that operate their store on eBay. Using these listing tools will allow dropshippers to learn how they can best serve their customers.
The platform also integrates with eCommerce stores like BigCommerce and Shopify.
The membership fee for Sunrise Wholesale starts at $49 per month. You can also take advantage of their 7-day trial period before committing.
6. Megagoods
If you’re looking for one of the best dropshipping companies that focus on consumer electronics, Megagoods is your go-to supplier. The company stores inventory at its warehouse, which allows faster shipping to the customers.
The Megagoods website has a section primarily dedicated to displaying the top 25 products sold from week to week. This allows merchants to discover which ones are currently on-trend, so they will better understand what products they should sell and how they should market them.
Here are some of the most popular products that you can offer your customers from Megagoods:
- Headphones
- Car audio
- Speakers
- Gaming products
- Home theaters
- DJ essentials
- Televisions
- Alarm clocks
- PA systems
- Kitchen appliances
- Cookware sets
Megagoods takes on additional measures to ensure the security of its customers while shopping online. They’re PCI-compliant, EDI-compliant, and they offer private label shipping.
You can start enjoying the features Megagoods offers at $14.99 per month. They also have a free 30-day trial period if you want to try it out first.
The Takeaway: Finding the Best Dropshipping Companies to Work With
E Commerce is a lucrative business to be in right now, especially in the midst of the COVID-19 pandemic as so many people are doing their shopping online. Dropshipping, for one, offers an easy way to set-up your online business. It’s low-risk and doesn’t require a substantial upfront investment. However, to do it right, you have to make sure that you’re partnering up with a reliable, efficient, and trustworthy company. That’s why it is important to decide what is the best dropshipping company by remembering the factors to consider when choosing the best supplier. Assess your business’s current needs and evaluate which company will best meet them. Hopefully, these top six suppliers are a good place to start your search.
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