Forum Moderators: buckworks
1. How can I protect myself from loosing loads of money if they turn out to be dodgy?
2. Is a bank transfer like handing over cash?
3. Do drop shippers normally pay before the product has shipped or after?
4. If I accept credit cards from my customers, how can
I protect myself from fraud?
5. How will I know if they have used a fake/stolen card?
6. Should I accept paypal payments?
7. How do drop shippers normally handle returns, do the returns go back to me or the company that shipped the product?
8. When will someone issue a cashback on their credit card? what does the credit card company do?
9. If someone uses a fake/stolen card and the product
ships who ends up paying? will I loose out or do the credit card company take the hit?
10. Do drop shippers normally ask for some kind of proof of shipping?
anything else I need to know? :)
20% is a rip, and I wouldn't do it.
Most decent drop shipping firms have payment systems already set up through ssl and can process directly online.
Ours (retailers) get 40% to 50%. We drop ship to whoever they (our purchasers) designate, though they are the ones paying initially. The money they make is the difference between what they collect from their customer and what they pay us.
We drop ship alot of items from different manufacturers without problem. At times when the customer actually wanted to return an item, the manufacturer actually even let us have the customer return it to them and credited us.
One thing to pay attention to is the time difference it can take between the time you ship out a product you carry in stock and one that gets drop shipped. The company sending it out may not ship as fast as you do, may not insure it, track it, etc... You may want to find out about their shipping arrangements first.
I personally think it should be illegal. For instance say I have a customer with a Missouri billing address and California shipping address. They would be double taxed from what I understand.
>>1. How can I protect myself from loosing loads of money if they turn out to be dodgy?
don't put loads of business their way until you are confident.
>>2. Is a bank transfer like handing over cash?
yes ... however for new customers we sometimes require it.
>>3. Do drop shippers normally pay before the product has shipped or after?
we only ship after payment is received (some customers can run a credit account)
>>4. If I accept credit cards from my customers, how can
I protect myself from fraud?
by taking the normal precautions, but ultimately you can't eradicate it.
>>5. How will I know if they have used a fake/stolen card?
the bank will reverse the transaction and inform you
>>6. Should I accept paypal payments?
yes
>>7. How do drop shippers normally handle returns, do the returns go back to me or the company that shipped the product?
we use a custom return address eg.
'merchant name' dept
warehouse
city
we charge a fee on returned items to the 'merchant' - its up to the merchant to deal with the end customer
>>8. When will someone issue a cashback on their credit card? what does the credit card company do?
don't understand the question
>>9. If someone uses a fake/stolen card and the product
ships who ends up paying? will I loose out or do the credit card company take the hit?
you take the hit
>>10. Do drop shippers normally ask for some kind of proof of shipping?
?
If your state has a sales tax, then you "as the retailer" are responsible to collect the sales tax for your items sold.
As a bonafied wholesaler, you are exempt from collecting sales tax in any US state that your warehouse resides in. The product cannot be taxed twice. It is up to retail outlets to perform the tax collection.
Tax forms for wholesale merchants can be obtained at any IRS office nationwide for states that charge sales tax
All credit card companies have reduced the chargeback limits to only 90 days.
A credit card company cannot issue a chargeback without good cause. If a chargeback is presented, the credit card company will notify "you" the retail merchant, and, if you can prove that the product was delivered to the customer via UPS tracking and delivery, and that the recipient signed for the delivery, then the chargeback will not be honored.
Prevent fraud by using an SSL type shopping cart that has AVS (address verification system) installed.
Require these things of your customers
Phone Number
Street Address
Email
First & Last Name
CVV2 Number
DO NOT SHIP any product before the processing of the credit card or check is finished
Though we strive to conduct an upright and honorable business online and protect our customers, we, as merchants have to first protect ourselves by installing or providing the right security protocols with which to conduct our business safely for all.
It is the dropshippers responsibility to provide shipment tracking, delivery and e.t.a. to their clients whether they be retail outlets or not.
As a functional dropshipping resource, all of our shipments are tracked via the delivery agent and a record of the shipment is kept on file for up to two years
If you are a retail outlet, your dropshipper (distributor) is responsible to provide you with any info regarding the shipment.
Your dropshipper selects the shipping agent of their choice and pays for the shipping out of what funds they have collected from you (the retailer) to cover any shipping needs of the product including insurance
Bank transfers, though an option, is not really recommended.
Most real time distributors and wholesale outlets will require a letter of credit from the purchasers bank for orders larger than $2,000.00 US Dollars.
Bank transfers are time consuming (paperwork) and expensive
A letter of credit, notorized and signed by a chief financial official of any US bank is as good as gold. Using this method guarantees payment for the predetermined amount stated in the letter, and the funds are transfered to you upon proof of product delivery.
Most larger distributors (wholesalers) will also not charge any return fees but may, at their discretion, charge a re-stock fee of 10% or less for bulk purchases that weigh over 1,000 pounds.
If you need to use pay-pal, then set up an account. But, once you become more established in your business it is recommended that you switch to a more secure form of payment processing.
I just have one more thing about the bank transfer question
Do not do a direct funds transfer to an agent that you have not met and have personally shaken hands with.
And, DO NOT ever conduct any kind of direct bank (funds) transfer to a bank that resides outside of the United States for any products for any reason, unless you actually own the company you are transfering the money to.
And, DO NOT ever conduct any kind of direct bank (funds) transfer to a bank that resides outside of the United States for any products for any reason, unless you actually own the company you are transfering the money to.
hey there, i take great exception to this.
each case should be looked at on its own merits but transfering money out of the usa is not always the kiss of death.
Indeed
Though it may not prove to be the kiss of death, I still won't recommend it to someone who is just starting out.
I really don't recommend the practice within the US either.
Retailers should never put themselves into a position to lose their money to a possible fly-by-nite.
Direct funds transfers to an unknown company for products that may or may not be delivered is a risk that even experienced companies should avoid.
Direct funds tranfers should only be done when you actually know the company or individual.
Most distributors or product wholesale companies will issue the person or company a line of credit after first having them fill out a credit app. Before they would ever require a direct funds bank transfer.
I strongly suggest that new merchants choose their distributors wisely, and try, if at all possible, to make your purchases from distributors that are capable of providing a functional and secure way to make your purchases online or through other established forms of credit, other than direct funds transfers.
We've been at this for quite sometime now, and have a fairly good handle on how this is done.
