Drop shipping with clear and immediate stock visibility
Today’s online retail landscape offers services to consumers that would have seemed like science fiction just a few years ago. Much of that is thanks to the power of drop shipping - the revolutionary ordering method that lets businesses fulfill orders quickly without having to keep the products in stock.
But competition is fierce and buyers are fickle. Any delays are punished hard and fast. Manufacturers need effective data transformation systems in order to be able to provide immediate and clear stock visibility to end users of all products and materials on-hand.
Most multiple-buyer channels have multiple requirements, which makes stock visibility more important than ever. The key for both drop shipping suppliers and drop shipping companies is real-time data transformation from a technology partner who understands the industry and can receive and transform data from each stock location in order to display it where, when, and how you like it.
The incredible power of drop shipping
When you take a step back and think about it, the level of customer service that people now take for granted is incredible. You can literally use your voice, or click a few buttons in the comfort of your home, to trigger an order of any product and have it delivered to your front door within hours. It’s mind-blowing.
None of that would be possible without dropshipping and world-class data transformation. But the systems required to provide that level of service are complex and require careful management.
The bottom line is this...if you are a company with an online presence and no stock in a warehouse, then your most important asset is your reputation. If customers don’t trust that you can deliver like you say you can, or if you cannot offer stock visibility to your partners, then they’re going to go somewhere else in a heartbeat.
Successful drop shipping means there are hundreds of details to get right for every order placed. From agile communication to BI analytics, dynamic data rules engines, and most importantly - a single integration platform, every piece in your system must be up to the complex task.
Teams that are not equipped with robust iPaaS systems are often simply overwhelmed by the scale of the task at hand. But those that get it right tend to succeed beyond their wildest dreams.
The business of Drop Shipping
Drop shipping is a massive part of the digital economy. In 2021, it was valued globally at $155.6 billion and that figure was projected to rise by 27% year-on-year until 2031, according to Allied Market Research. Fortunes are being made every day.
If you are unfamiliar with the process of drop shipping, let’s take a quick run through the basics.
When an order comes through from a customer to an online store via any one of a number of digital platforms, the online retailer will put an order through to a dropshipping supplier. They are tasked with preparing the customer’s order and shipping it directly to the customer on your behalf.
As an online retailer, that means so many hassles off your plate, right? Possibly...but there’s a lot more to drop shipping than meets the eye.
The Pitfalls of Drop Shipping
When it’s working smoothly, drop shipping is a dream. But there are many problem areas that you need to keep an eye on.
Long shipping times due to complex processing and handling issues can lead to a huge amount of frustration. Quality control issues can crop up over time without stringent controls. Many drop shippers work with low margins and issues such as inflation or supply chain issues can make life very difficult for them, and as a result, lead to limited stock selection for consumers. Returns and exchanges can become an absolute quagmire if you’re not careful.
Much of your success will depend on the systems that you have in place for the times when problems arise.
One of the most valuable tools at your disposal is an iPaaS solution that is driven by a robust dynamic data rules engine. This is a system that allows users to define and manage com defined using a variety of inputs and conditions, depending on your business, and is most effective when applied to data in real-time. The rules can also be updated and modified in the moment, which allows for a high degree of agility when it comes to handling data.
5 Ways That A Dynamic Data Rules Engine Can Transform Drop Shipping
It’s most effective when used for data integration and warehousing, as it streamlines the process of drop shipping by providing a way to validate and transform data in real-time, as it is received from suppliers. Here are 5 ways that your drop shipping can be transformed with the right iPaaS toolset and Data rules engine:
Parse Information
Ensure that product data received from suppliers is using the correct format and contains all of the necessary information.
Inventory Control
Validate that prices and inventory levels are within a certain range, and automatically update pricing or inventory accordingly.
House keeping
Automatically flag or remove products that are out of stock or no longer available for sale.
Shipping
Validate shipping rates and delivery times based on traffic, supplier availability, and location.
Benefits that flow naturally
The Value of Immediate Stock Visibility
One business aspect that retailers need to insist upon when using drop shipping suppliers is clear visibility into the stock availability. It’s incredibly disempowering to not know what products are available at any given time.
Immediate stock visibility is a key differentiator for drop shipping suppliers and it goes a long way toward ensuring the efficient and successful operation of a drop shipping company.
There are a number of benefits that flow naturally from stock visibility that you should take into consideration.
Increased Customer Satisfaction
With so many choices available online, nothing is more off-putting to a consumer than being told that the product they ordered is not available. You can avoid that embarrassing situation with immediate stock visibility that tells you where a product is stored, how much inventory there is, and when it can be delivered.
Eliminate The Back Orders Problem
When an order is placed for an item that is (temporarily) out of stock, it leads to a backorder. Too many of them start to clog up the system and lead to further delays, more frustration, and a gradual degradation in the entire business model.
Greater Efficiency
The problem of back orders goes away with immediate stock visibility.
Inventories can be adjusted to reflect only products which are available, leading to greater customer satisfaction and increased profitability.
Better Planning
Your sales calendar is unlikely to be consistent all year round. With a window into stock visibility at your drop shipping supplier, you’re able to plan better, anticipate what your needs will be, and run a tighter, more profitable operation.
The Lumino Solution
The business of drop shipping is complex and requires software that is agile, powerful, and built to task. Lumino by Ariox offers the functionality that users need to manage omnichannel orchestration in-house, using one intuitive tool. Users have access to a host of integration features that increase automation and communication between the systems they use most.
There is no building from scratch. Instead, your setup is customized to suit your needs. Intuitive functionality, data analytics, and user-managed integration control result in a transformation of the complex web of connections being reduced to a straightforward and repeatable practice.
Ariox is on a mission to make bigger and broader businesses feel smaller, simpler, and more manageable. We know how you can allow your enterprise to expand and grow further than you thought possible, all while maintaining balance and keeping you in the cockpit of your day-to-day processes. By putting you first, being completely forthright and trustworthy in our dealings, and providing real solutions to today’s complex business challenges.
Reach out today to speak to one of our qualified consultants to find out how Lumino can work for you. Or sign up for a free Product Tour of our incredible iPaaS solution.
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