incrediBILL - 9:54 am on Aug 15, 2010 (gmt 0)
It's all about setting expectations and educating the customer.
Customer frustration only comes from hiding business practices and not explaining to the customer what to expect.
Come out of the closet, explain that since it comes direct from the manufacturer they're saving on duplicated shipping costs and wasting energy moving products twice for no real purpose.
Wrap a "green" label on it and promote yourself as energy saving BECAUSE you drop ship, good for the planet!
When the products are placed in the cart it should group them based on shipping locations, explain it'll be 3 boxes instead of 1. Make sure the final order says how many boxes, the boxes themselves should plainly state "1 of 3" or whatever on the shipping label in big letters. Additionally, the customer should be able to track the entire order from your site and reinforce the order tracking on every packing slip, etc. to keep people off the phone as much as possible.
Explain why your prices are better because you're saving on warehousing costs, also explain how eliminating the warehousing redundancy saves energy too, the fewer warehouses, the greener!
Make the customer understand you're doing business this way to give them the best deal possible while doing what's best for the planet as part of your business model.
Make it a marketing win and send your competitors off the deep end trying to figure out how to combat your honest and "green" approach!
Heck, if you know your competition is drop shipping as well, out the competition by telling people that nearly everyone in your industry drop ships, they just don't tell you they do.
Be the honest guy and make the others look like shady jerks ;)