If you don’t fully understand what a dropshipping agent is or what they do, you’re in for a shock!
Most successful online retailers transition from standard dropshipping to working with an agent based in China as soon as possible. Simply because of all the things a dropshipping agent can do and the advantages they can provide a business.
The amount of services they offer allows merchants to take their business to the next level. The real money in eCommerce is made by building a brand and scaling to its full potential and agents help do this.
20 Things a Dropshipping Agent Does for your Business
1. Product Sourcing
Most people head to Alibaba to source their products without any real guarantees of how reputable the supplier is and how good the product quality will be. Dropshipping agents know how to source products from the best factories in China. They want to build a long-term business partnership with you so they are motivated to source reliable manufacturers that produce quality products.
2. Order Fulfillment
Most dropshipping agents can automatically fulfill your orders without you needing to do anything which essentially puts the whole process on autopilot. They do this by integrating directly with your Shopify store with their app which fulfills the orders and they then upload the tracking numbers for each order.
3. Fast Shipping
Dropshipping agents will usually have access to better and faster shipping lines in China such as YunExpress, 4PX and CNE Express. These shipping options are not available to consumers and even most AliExpress sellers. Agents have access to these superior shipping lines because they have built relationships with them and have high order volume.
4. Worldwide Shipping
Agents manage the entire supply chain process which can be complicated when shipping worldwide. The ability to ship worldwide directly from China at an affordable cost is a huge advantage. This is not always possible if you’re shipping goods worldwide from the USA, the costs are much higher and often not a viable option.
The majority of the larger dropshipping agents can offer the storage of your products in their China based warehouse. Sometimes this service is free with specific plans and orders you make or it can be charged at a low fee.
6. Factory Relationships
The best agents will already have built up relationships with many manufacturers and factories which provides many benefits you would not have otherwise. This could be in the form of specialty materials for product customization, lower product cost or improved lead times and better communication.
It can be difficult to scale your business during peak times without the assistance of an agent. The best agents have the manpower and the connections to be able to scale your business to its full potential leading up to Q4. You need to know whether you should increase your ad spend and scale your business with confidence knowing they can handle your order fluctuations throughout the year.
Dropshipping agents should be able to effectively communicate the entire process with you. Chinese manufacturers often don’t speak fluent English and will not keep you updated during the entire product development process. An agent can keep you updated and provide feedback to ensure complete transparency and help avoid any issues.
It can be difficult to negotiate with suppliers in China as a foreigner. A Chinese based dropshipping agent understands what is possible in terms of pricing and benefits and they may be able to negotiate better terms than you can. They can often collect quotes from multiple suppliers and allow you to choose the best option.
10. Ordering Samples
Ordering samples is essential, however, samples are expensive and often shipped using slow shipping lines. You will usually have to order samples from multiple factories and at various stages throughout the development process. A big advantage of a dropshipping agent is you can have all your samples shipped to your agent who can send them together which will save you money shipping individual items from China.
For more info on ordering samples, I have an article on How to order samples from Alibaba the right way.
11. Product Customization
Agents can work with you to help you customize and develop your own product. They can communicate directly with manufacturers to help you achieve your ideas. This can be a brand new idea of a product you want to develop from scratch or making small improvements and changes to established products to help build your own unique product and brand.
12. Quality Control
Depending on the dropshipping agent, you can request quality control inspections to be performed throughout each step of the process. This can be pre-product inspections, in-process inspections, post-production inspections, container load inspections, random sampling inspections and the list goes on.
13. Supplier Evaluation
It’s difficult to fully judge how legitimate a Chinese supplier is if you live in another country. An agent can perform an audit on their company to show you whether they are who they claim to be. Are they a trading company posing as a manufacturer or are they even a real supplier at all?
14. Pre-Shipment Inspection
If you’re shipping large orders worth thousands of dollars, you want to be sure the shipment process runs smoothly or else it could cost you a lot of money. By having a pre-shipment inspection of your products, you reduce the chances of:
- Products are being swapped to an inferior version without you knowing
- Pre-shipment photos prove product condition if there is any transit damage
- Your products are being loaded onto the wrong container
- Reckless handling causing broken goods
- Wrong order quantity is being shipped
- The overall quality of the product meets the contract quality
- Wrong or broken product labels
15. Product Photography
Some agents offer professional photography for your products. You can request the kinds of photos and backgrounds you require and many can provide this service. This can save you time and money by sending products to yourself and paying a photographer to take the photos for you.
16. Inventory Management
It can be difficult to forecast inventory when you are ordering bulk orders to be shipped to a 3PL based in the USA. You have to communicate with a factory how long the production times will be and shipping is usually done by sea. This can potentially take a couple of months.
Agents can manage your stock levels for you and provide far more accurate lead times and can ship the products to you much faster due to having access to faster shipping lines.
17. Returns and Refunds
Not all dropshipping agents will be responsible for returns and refunds, but you want to work with an agent who is responsible. This way they provide after sales service and for any products that are lost during transit, are broken during transit or arrive at the customer with any defects, the agent will resend the item for free or refund the customer’s money.
18. Customs Clearance
This can be an issue many people don’t consider. It can often be difficult for orders, especially bulk orders, to clear customs and can often cause delays. Agents can prepare all the documentation to reduce the risk of delays and make the process much smoother.
19. Private Labeling Solutions
Dropshipping agents can do a lot in terms of helping you build a brand. Apart from product development, agents can help you create custom packaging with your business printed on it as well as inserts and thank you cards which increase repeat purchases.
20. Holiday Supply Chain
There are two times each year that eCommerce businesses run into issues when fulfilling orders from China, Q4 and Chinese New year. An experienced agent knows how to handle these supply chain problems and can plan ahead so it will not interrupt your business.
Should I use a dropshipping agent?
Dropshipping agents should be used by online retailers who want to source high quality products from reputable manufacturers and plan on building a brand by private labeling their products.
What are the advantages of a dropshipping agent?
The advantages of a dropshipping agent are they handle all your sourcing, order fulfillment, warehousing, logistics and communications with your manufacturer allowing you more time to focus on marketing.
What are the disadvantages of using a dropshipping agent?
The main downside of a dropshipping agent is they won’t usually work with merchants who are not fulfilling at least 20 to 30 orders per day which makes them inaccessible for beginners.
Are dropshipping agents trustworthy?
There is no barrier to entry to become a dropshipping agent which can make some of them untrustworthy. The legitimate agents are usually larger companies with several years of experience.
As you can tell a dropshipping agent can do so much for your business. The 20 advantages listed above are not the only services they provide, they are 20 of the most common. Add to that they can organize your contract terms and conditions, lab test your products, provide certification for specific products and the list goes on.
Most merchants sourcing their products are not working directly with a manufacturer and are instead working with a middleman of some kind whether that be a wholesaler or distributor. A dropshipping agent is an ultimate middleman as they provide all these services that no other supplier can offer. The right agent can make or break your business.
When choosing an agent don’t only look at who offers the lowest pricing, instead, decide which of the above services you require first. There is not much point in choosing an agent who will not fulfill your business needs because they offer the lowest prices, often this may end up costing you more money in the long term.