In this age of Amazon ordering and routine online shopping, opening your front door and seeing a package shouldn’t get too much excitement, but it does! Having a package delivered right to your door, especially if it’s a gift, is still a surprisingly pleasant experience.

Drop-ship fulfillment is where it all begins. Drop-shipping is a service whereby suppliers use a courier to transport an individually wrapped promotional product or gift kit directly to the end users’ home using an address list provided by the customer via the distributor.

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The practice of distribution has increased dramatically during the pandemic as a way for businesses to deliver gifts directly to remote workers or customers at their homes. Dan Walls, logistics manager at PowerStick.com (asi/51566), estimates that in 2021 about 25% of the company’s orders were fulfilled. This year, he’s seeing only a slight decline in drop shipping with an equal increase in bulk shipments. That’s because today, even with many employees returning to their jobs at least one or two days a week and in-person events back on their calendars, dropshipping promotional products continues to be a much-demanded service due to its ease, convenience, and the personal touch it offers, especially for end-of-year and holiday thank you gifts for customers, employees and suppliers. Dropshipping can also be a beneficial add-on service for distributors.

Note that while some suppliers in the promotional industry outsource drop shipping to a third-party fulfillment company, others like PowerStick handle the production process of the shipping labels, pack the boxes and ship them completely in-house using carriers such as FedEx, UPS and USPS. (Or all three, in the case of PowerStick.)

Learn the basics of dropshipping

Dropshipping involves three basic steps to getting a package from the factory to the recipient’s door.

  1. The distributor must provide an Excel spreadsheet containing recipient information which is then carefully checked to ensure all information has been entered in the correct columns.
  2. Next, the file is uploaded to the supplier’s shipping software and any errors encountered by the system are corrected before shipping labels are printed.
  3. Boxes are prepped, packed, labeled and shipped.

Successful dropshipping largely depends on the address list you provide to the supplier, so the phrase “junk in, junk out” definitely applies here. Drop-ship errors can be costly to fix. For example, if the spreadsheet provided by the distributor contains errors and the consignee details are not verified, the package may be considered “undeliverable” and will be returned to the forwarder, not the owner of the account number.

Another aspect to consider is that in some countries, such as Brazil, Argentina and India, it is practically impossible to clear a package through customs. If it cannot be canceled within a short period of time, 2-3 days in the case of South America, it will be returned. The supplier charges the distributor who, in turn, charges the customer. In many countries, the shipping company will call the recipient ahead of time saying he has a delivery and asking if the recipient will be at home to accept it. Unfortunately, the recipient often assumes the caller is from a utility company that wants to discontinue service, so they decline, and after three days, the package is returned to the shipper. All of these transactions add up to the sender’s account and the charges are billed back to the distributor and then to the customer.

6 tips to avoid mistakes

To streamline the process and avoid costly and frustrating delivery errors and delays, distributors need to be vigilant in preparing the Excel spreadsheet. These tips will help you:

  1. Verify that the recipients and addresses on the spreadsheet are correct and up to date.
  2. The spreadsheet should contain a separate column for each of these fields: Company Name, Ship To Name, Address Line 1, Address Line 2, City, State, Zip Code, Country, Ship To Phone, and Ship To Email. Include first and last name together in one column. Apartment or suite numbers must be entered in address line 2 (if applicable), otherwise additional shipping costs will be charged.
  3. Don’t mix quantities of products on a single spreadsheet. In other words, every name on the list should receive exactly the same shipment. If some recipients receive a different amount of products, list them on a separate Excel spreadsheet.
  4. If your shipments are to recipients in both the United States and Canada, create a separate spreadsheet for each country. Recipients in other countries can be included in one sheet.
  5. All state and country codes must be in a two-letter format.
  6. Send the spreadsheet to the supplier as soon as possible to allow time to check and correct any errors.

As with all business transactions, distributors looking to drop-ship should choose their supplier or fulfillment company wisely and be aware of the additional challenges of shipping outside of North America. However, if the correct procedures are followed, drop shipping can be a very effective delivery method and a profitable part of their business.

Tina Berres Filipski is director of corporate relations at PowerStick.com. She is a 26-year promotional products industry veteran and was previously the director of publications and editor at Promotional Products Association International (PPAI).

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