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Wei Linchao

Wei Linchao

Dropship and Logistics Specialist, the founder of Bestfulfill that help you with order fulfillment from product sourcing, shipping, branding, and customized package.

Can I Use Different Suppliers for Dropshipping?

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Yes, you can source your dropshipping merchandise from multiple suppliers. This is particularly common among the drop shippers that offer multiple product types. You could also have multiple suppliers for a single product type in an effort to get the best deals.

Multi-sourcing ensures that you get competitive pricing and prevents shortages in your business—in the event that one supplier is unable to deliver. This way, you can offer your customers variety and meet the growing demand for faster deliveries and personalized shopping experiences.

Get to know the pros and cons of using multiple suppliers for dropshipping as well as how you can manage the suppliers more efficiently. 

Can I Use Multiple Suppliers for Dropshipping?

It is okay to have multiple suppliers for the items you offer in your dropshipping store. When starting, industry experts advise that you stick to a single supplier as it makes it easier for you to manage and learn the business.

However, you will soon realize that multiple suppliers have much more to offer your business. With multi-sourcing, everything is pretty much the same as when you are sourcing from a single supplier. The only difference is that you need to send your orders to different suppliers if you choose to multi-source.

Sourcing for different dropshipping suppliers can be done in two ways:

  • a)    Different Suppliers on the Same eCommerce Platform

This is when you place your orders with multiple suppliers that exist in the same eCommerce marketplace. A good example is when you order items from two different suppliers on AliExpress. This is the easiest way to dropship when you are souring from multiple manufacturing partners or suppliers.

Image Source: (https://dodropshipping.com/dropshipping-with-multiple-suppliers/)

In this case, you will process the order just as you do with a single supplier, only that you need to repeat the process for each supplier. Also, remember to account for the additional shipping costs you may incur with multi-sourcing. 

Note: When sourcing from multiple suppliers, you should consider informing your customers that the items will arrive in multiple packages and probably at different times.

You should also consider ordering from suppliers that offer similar shipping times to avoid discrepancies in delivery times for your customers’ orders. 

  • b)    Different Dropshipping Suppliers Across Multiple eCommerce Platforms

This is when a drop shipper sources its merchandise from different suppliers that exist on different eCommerce platforms. For instance, you may have one of your dropshipping suppliers on Spocket and one or several others on AliExpress. As you can imagine, this is much more complicated.

However, it is still possible with the right supplier management tools and strategies in place, as explained later on in this article. In such a case, you could use such automation tools and software as Aliscraper.

Such tools will help you keep track of your orders on different platforms from a central point, as illustrated below:

Image Source: (https://dodropshipping.com/dropshipping-with-multiple-suppliers/)

Challenges Associated with Using a Single Dropshipping Supplier

Ordering all your dropshipping merchandise from a single supplier or manufacturing partner is straightforward. Even so, any successful drop shipper can tell you that single sourcing is not dependable. It exposes your business to several uncertainties and risks, including: 

  • a)    Low margins

Even when you are sourcing from a manufacturing partner, product prices are subject to changes from time to time. To facilitate dynamic pricing in your store, you should be in a position to adjust to changes in supplier pricing in real-time.

In the eCommerce world, you just cannot go about raising your prices every time your supplier changes item prices. This is mainly because your pricing needs to remain competitive in the increasingly competitive environment.

This being the case, changes in supplier pricing can diminish your profit margin gradually if you only buy from one dropshipping supplier. With multi-sourcing, however, you can just shift to the supplier that is offering the best deal and protect or even boost your margins.

  • b)    Shipping Issues

With the recent eCommerce growth comes the need for faster deliveries and reliability by consumers across the globe. As you may know, things happen that can prevent even the most reliable suppliers from sending out your order in time.

Such delays—anticipated or otherwise—will make you look bad to your customers. With multi-sourcing, you can just place the order with an alternative supplier if one is unable to deliver within the required timeframe.

If a customer needs their order delivered much faster, you could just use a supplier that has a warehouse closer to your customers’ destination. This way, you can speed up delivery and save more money on shipping costs than if you were to opt for a costlier shipping method.

  • c)    Vulnerability to Disruptions

If anything disrupts the supplier’s operations, it may well ground your dropshipping business. If a catastrophe happens that renders the supplier unable to ship the merchandise, it will definitely affect your business.

If for some reason the supplier is unable to continue dropshipping your orders, your supply chain will be disrupted. This can have devastating effects on your business. To avoid downtimes and ensure continued supply of merchandise, it is advisable to work with multiple suppliers at any given time.

Benefits of Using Multiple Dropshipping Suppliers

Though a bit cumbersome, using different suppliers is much more beneficial than single sourcing. By partnering with multiple suppliers, you can effectively:

  • a)    Improve Supply Chain Resilience

Partnering with several dropshipping suppliers is a great way of making your supply chain more resilient. It makes your business less vulnerable to disruptions as well as wastage of time and money in the event that your primary supplier fails to deliver.

This has been proven to drive core business growth amidst changes and competition in the industry.

  • b)    Risk Reduction

As noted earlier, single sourcing exposes your business to the risk of inventory shortage. With multiple dropshipping suppliers serves as the contingency plan you need to prevent disruptions. Even is your primary supplier decides to pull out, you can be sure to meet the demands of your customers.

Possible Drawbacks of Multi-Sourcing for a Dropshipper

Well, if you had different suppliers fulfill your customer’s orders, the items will arrive in different packages. This is to say that a single customer may end up getting multiple packages for a single order—depending on the number of suppliers you use for the order.

This also implies that the items will be packaged differences and probably arrive at different times. Such inconsistencies can affect customer experience and trust in your business. There are two main approaches you may use to get your business out of this predicament:

  • a) Keep the Customers Informed

One approach is to inform the customers that you will be sourcing their items from different suppliers. Let them know that they will be receiving their order(s) in multiple packages. Keep them informed that the delivery times for the separate packages may differ slightly.

If the customers know what to expect beforehand, they will not be surprised when the items are delivered in separate packages. You should also make a point of sending the customer tracking information for the separate packages as soon as they ship out.

  • b)    Hire a Reputable Dropshipping Fulfillment Agent

The second, and arguably, best solution to this problem is to hire a sourcing and fulfilment agent in China. A good agent like Best Fulfill can help you consolidate, and even repackage merchandise from different suppliers and ship them out as a single consignment.

This ensures that your customers receive their items in a single package, regardless of the number if dropshipping suppliers you used to fulfill the order. 

When Do I Need to Use Different Dropshipping Suppliers?

Many dropshippers are accustomed to having a single supplier fulfill their orders. So, when do you need to use different suppliers in your business?

  • a)    When Offering Different Product Lines in Your Store

Whenever you launch a different product line in your store, chances are that you will need a different supplier to fulfill orders for that particular product. If you happen to offer different product types in your store, it makes sense to partner with a few more dropshipping suppliers.

Image source: internet

  • b)    When You Need to Get the Best Deal for Each Item

As mentioned earlier, supplier and manufacturer prices fluctuate from time to time. Again, different suppliers price their products differently. By now, you must have come across a scenario where different suppliers quote varied prices for the same product.

Having partnered with multiple suppliers, you can re-evaluate their pricing every time you place an order. By so doing, you will always order from the supplier offering high-quality products at the best price points at any given point.

This flexibility ensures that you get the best deal possible whenever you place your dropshipping order.

  • c)    Low stock levels for popular products

As your business grows, so does order quantities. With time, your primary supplier may become overwhelmed by the increased demand. In other times, the primary supplier may not have enough inventory to fulfill your order(s). In either case, you need to partner with another dropshipping supplier to meet the deficit.

  • d)    When You Need to Improve on Your Supply Chain Reliability

Even when one of your suppliers is having problems, you should be able to deliver quality products to your customers on time. As a dropshipper, you do hold any reserve inventory to cushion your business against disruption in such an eventuality.

This is why you need to establish relationships with multiple suppliers. Think of the additional supplier(s) as a contingency plan for your business if your primary supplier falls short of your expectations.

How To Manage Multiple Dropshipping Suppliers Seamlessly

Despite having many benefits for your dropshipping business, partnering with different suppliers adds to the complexity of your supply chain. For everything to run seamlessly, you need to manage your dropshipping suppliers and manufacturing partners more effectively.

Image source: https://support.ordoro.com/how-do-i-set-up-and-use-the-vendor-portal/

In this regard, here are some tips that will come in handy:

  • Introduce Unique SKUs

The first “order of business” is to keep everything organized. The best way to do this is to introduce unique stock keeping units (SKUs). These are easily-identifiable units/names that are assigned to inventory items to allow for easier tracking.

To keep everything organized, create an Excel sheet for each of your dropshipping suppliers. To create unique SKUs for your business, you could just alter the supplier’s SKU number. For instance, if the supplier provided SKU is ORGANICFOODSUSA – 1161, you can have OFUSA-1161 as the SKU for that item in your business.

Enter this information into your Excel sheets for easier tracking and management.

  • Use Relevant Apps to Automate Order Fulfilment

Rather than having to manually transfer customer information every time you fulfil an order, try automating the process. To this end, you can choose from the many dropshipping fulfilment automation applications available today.

This will make the process much easier, save time, and prevent errors that may occur when the information is copied manually.

  •  Integrate Order and Shipping Info

In the past, keeping order and shipping information for items sourced from different dropshipping suppliers was a challenge. Thanks to apps that have been specifically developed to consolidate shipping orders, this is not longer the case.

Some dropship automation software, such as Inventory Source, ALOS offer “Shipping Consolidation” as a feature. You could also use third-party order consolidation applications like Ship Happen, Shippo, and ShipStation.

  •  Use a Data Synchronization Software

Keeping the various SKUs organized is just part of the management process when you are using multiple dropshipping suppliers. You also need to coordinate other variants, such as product availability, number of orders, and inventory levels for each supplier.

Some manufacturers will offer you a Dashboard that you may use to monitor such aspects through your account on their websites. However, even that will not suffice when you are working with different suppliers. Instead, you should consider centralizing this information.

Several software solutions and mobile apps have been designed to do just that—syncretize order and inventory information across multiple suppliers as well as manage all your dropshipping data from a central point. Some of the best data synchronization solutions for a dropshipper include Inventory Source, Store Automator, and Salsify.

How Can  I manage a Product(s) that Has Multiple Suppliers?

This is a rather unique scenario when a single SKU can be fulfilled by different dropshipping suppliers—commonly referred to as redundant suppliers. Such a scenario can arise when:

·         Your dropshipping supplier(s) has warehouses that maintain similar inventories in different locations.

·         Multiple dropshipping suppliers offer the same product(s)

·         Your primary supplier does not have enough inventory levels to meet your customer’s order requirements

In either case, the best approach would be to find supplier managemnt software solutions that support multiple suppliers per SKU. One such solution is the Duoplane app

Conclusion

For your dropshipping store to thrive, you need to partner with reliable suppliers and manufacturing partners. When starting out, a single supplier may be sufficient. However, a drop shipping business is only as good as its suppliers.To curb risks, boost margins, and enhance customer service in your business, you should consider using multiple dropshipping suppliers. If you would rather have the items from different suppliers consolidated and shipped together, you should hire the best sourcing and fulfilment agents.

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