What Is Dropshipping With a US Warehouse? How, Why, and When
Dropshipping is a retail venture which is booming according to recent studies. Many might be wondering if you can dropship using a USA warehouse – and if so, then how!
We will get started first with what dropshipping with USA suppliers is, so you can start your preparation and get involved!
Then we can take a look at whether dropshipping from the USA is better than shipping from China, how to dropship from the USA, and when it’s the right time to scale your business into the USA.
Dropshipping with USA warehouses means ordering products from China initially but then ship them directly to warehouses based in the USA. This is in contrast to the more usual method of dropshipping products straight from manufacturers in China and other southeast Asian countries.
When we discover that the eCommerce market was worth a staggering 4.28 trillion dollars worldwide in 2019, there will be many entrepreneurs who want to get started straight away!
So that we can see how it might be profitable to use USA warehouses for your dropshipping, Shopify or any other type of ECommerce store, we will investigate whether there are any benefits.
We will start with the benefits and advantages of using warehouses in the USA, before looking at how that compares to more traditional methods, such as drop-shipping directly from Chinese warehouses.
The advantages of dropshipping with USA warehouses
As you may or may not know, Dropshipping is an order fulfillment method that does not require a business to keep products in stock. Instead, the store sells the product and passes on the sales order to a third-party supplier, who then ships the order to the customer.
So using the dropshipping method you might be keen to find out how dropshipping from the USA to your customers compares with the more traditional methods of dropshipping from China.
Warehouses in China
In general, products are shipped directly from warehouses in the countries where the products are manufactured. These countries are often Asian, such as China.
The downside of china warehouses is that shipping can often take 7-12 days even with express shipping, and might take longer during holiday seasons.
“The downside of china warehouses is that shipping can often take a number
of days, sometimes even weeks to reach your customers in the USA.”
Faster delivery to USA customers dropshipping from the USA
So it doesn’t need you to do much in the way of research to work out that using a warehouse in the country where your customers live will mean much faster delivery for them!
Shipping issues can often be one of the main criteria that cause no end of problems for dropshippers.
With the likes of Amazon offering virtually immediate delivery, customer expectations, especially in more developed countries such as the USA, have increased.
Dropshipping from USA warehouses will give your American customers a much more streamlined service. This will include not only faster shipping times, but a speedier delivery too.
You will be looking at delivery of around 2-4 days in general. This will help keep your customer service hat out of the picture, as shipping issues such as delayed or missing products can often be the chief cause of customer complaints.
“Dropshipping from USA warehouses will give your American
customers a much more streamlined service.”
A sustainable business model
Having USA warehouses can help you to grow your dropshipping business, with a much more stable and sustainable business model.
The USA has one of the most stable economies and infrastructure in the world which will bode well for anyone doing business in the USA. Although according to research many do see China as equivalent in its power base. But results still show that the USA clinches the title as the world’s largest economy, with a forecast for nominal GDP of USD 25.3 trillion in 2024.
Returning customers are the icing on the cake for dropshippers thinking about using USA warehouses.
Customers with the advantages of purchasing from USA dropshippers are very likely to continue to buy from you and have loyalty to your brand and
This is mainly because of the faster shipping we mentioned earlier.
With warehouses in the same country as your USA customers ensure a much smoother transaction. This will most likely result in less customer service such as lengthy shipping or the worst-case scenario, a disappearing order.
So let’s compare this with sourcing and delivering direct from China to see how it compares
- More product choice: As China is the manufacturing capital of the world, there will most likely be a much wider selection of products to choose from than using USA warehouses.
- Cheaper products: China is well known for its inexpensive mass production, which is likely to mean that products sourced and shipped directly from China will be significantly cheaper than dropshipping from USA warehouses.
- Customization: Reliable Chinese suppliers will be able to offer customized services. This could include unique private-label goods and include shipping packaging, thank-you notes, and other types of customization.
“China is well known for its inexpensive mass production”
Ok so we’ve looked at some of the pros and cons of dropshipping direct from the USA, so you can choose which will best for your Shopify, or any other type of ECommerce store.
So if you have decided to use the USA to fulfill dropshipping orders, you might be wondering if there’s a right time to begin the process.
When should you consider dropshipping with a USA warehouse?
Knowing the exact time to scale your business is important for any budding dropshipping tycoon! Especially those who are wondering if it’s worth using USA warehouses.
Chinese New Year
One of the best times to utilize warehouses in the states is when the Chinese New Year celebrations take place. At this time many if not most Chinese manufacturing and other businesses shut their doors for a whole month.
So by making sure you have this period covered by using USA warehouses for dropshipping, you will keep ahead of the competition and ensure your customers are getting a good service.
Finding winning products can be difficult for fledgling dropshippers. Scaling your business before you have secured some products which are selling well is not recommended.
Instead, we suggest that you wait until you have sold at least 50 or more products over 30-day period before you begin to scale up and use USA warehouses for dropshipping.
Ok, so we now know the benefits and the best time to start using warehouses in the USA for dropshipping. But how do you do it?
How do I dropship with a USA warehouse?
It’s a simple 3-point step:
- Place the inventory order and make any necessary customization
- Ship the inventory to USA warehouse with air or ocean shipping
- Fulfill orders with the inventory
And here’s another 3 expert tips for getting the best out of dropshipping with USA warehouses.
3 expert tips for USA warehouse dropshipping
- Make sure you plan months ahead
- Manage cash flow well
- Work with a reliable supplier
And to finish on….
So that’s hopefully given you everything you need to know before dropshipping from USA warehouses!
Working with a reliable supplier is paramount to getting your dropshipping venture taking off using warehouses based in the states. Here at HyperSKU, we can:
- Be your supplier
- Handle all order fulfillment
- Ship with express shipping
And more importantly, improve efficiency with just one integrated system.