With COVID-19 restrictions, dropshipping will be huge this Q4. Plan your supply chain NOW to successfully scale up to 7 or 8 figures in 2020.
Q4 is typically the most profitable time of the year for dropshipping and ecommerce as a whole. You are probably already excited to scale your winning products into 7 or even 8 figures this Q4 in 2020. With many shopping malls closed or restricted due to COVID-19, and ecommerce booming, this year may be your best opportunity.
However, there are usually higher supply chain and logistics risks in Q4. With Q4 peak sales season coming close, will you be able to deliver Christmas gifts to your customers on time?
Anyone who is serious about dropshipping has probably heard of the horror stories of Q4 fulfillment gone terribly wrong. Customers waiting for 30 days or even longer for orders to arrive (maybe as late as February). You DO NOT want that to happen at your store, and end up with huge losses of it. However, this could easily be a reality if you do not plan ahead.
Literally everything explodes in holiday seasons. Every year starting in November is when customers begin to purchase a lot more products, whether its for gifts or even just for themselves. The concern is always, of course, whether it will be delivered on time by Christmas.
This is when things go crazy in the supply chain. A sudden surge of holiday shoppers, huge order volumes, more dropshipping stores, etc. But there are only so many factories! Production simply cannot keep up with the orders. As a result, it takes longer for your agents or suppliers to get inventory and fulfill orders for you.
The logistic chain is also extremely stressed out in Q4. The volume of packages is so much higher than usual. Shipping lines don’t have enough cargo space for all those orders, custom clearance takes longer, delivery by couriers also takes more time.
For more details on the potential and challenges of Q4 dropshipping, check out this video: Dropshipping Supply Chain in Q4 2020 | Maximize your profits by planning as early as possible
Even though so many things could go wrong dropshipping in Q4, it is undoubtably the biggest opportunity for making sales through the year. If you plan ahead, you can certainly scale up stores to huge numbers – 7 or 8 plus figures of sales. As a dropshipping fulfillment agent, we have a few tips on how to plan ahead.
The earlier you start scaling, the better you will manage in Q4, the busiest time of the year. Bear in mind, It takes time to find a reliable supplier and develop a good relationship with them, and them to build good relationships with their factories and shipping lines.
If you don’t know which product(s) to scale in Q4 yet, make a choice NOW. Cut the losers and start planning your supply chain asap. You need to make sure your supplier or agent can keep up with your scaling plan in Q4. If you wait until mid-November, factories are normally at their top capacities. You won’t be able to scale to your true potential.
Given all of the potential challenges of scaling through Q4, you NEED to find the right supplier to support your supply chain. Fulfillment for high volume / scaling stores takes a very different type of skillset, experience, and resources vs fulfillment during normal times. Many suppliers might do fine during slower periods, with steady order volume but are NOT equipped to handle the challenges of Q4.
We at EcommOps have deep experience scaling up hundreds of client stores to 6, 7, and 8 figures, many during Q4 without significant issues. We achieve this by working with factories directly, planning production and inventory management thoughtfully, and highly efficient processing procedures. Additionally we constantly scale up our resources given client scaling needs so clients never outgrow us.
How profitable your store depends a lot on your supplier’s experience and ability. They are the ones that manage inventory, quality control and efficient shipping for you. All these aspects are crucial to your refund rate, customer reviews, Facebook feedback score, Paypal / payment processors account health. In other words, you really want your supplier to be an involved partner in the process. Therefore, make sure to discuss your Q4 business plans with them beforehand.
Confirm your scaling plans with your agents/suppliers as soon as possible. Allow them some time to confirm production capacity and lead time. Figure out whether they can keep up with your scaling need.
Depending on your situation, you may want to discuss if it makes sense to purchase some stock beforehand even if you generally order your inventory as you go. Some hot products are already hard to get a hold of in normal times.
Check out our case study on how proper planning can make you 2.4 million in less than a month: Fulfilling 2.4M Worth of Orders in Under 30 days | How supply chain planning is critical for scaling
Depending on your inventory planning you may want to be cautious of your marketing spend through the period so that you do not significantly outsell your planned stock. In addition, work together on any branding and customizations ASAP. These takes time to get right. Better get it done before the craziness of Q4 peak kicks in.
It is worthwhile to check if your suppliers can offer a better shipping option. Later in Q4, we suggest you opt for an Express line that costs a bit more. Although your costs are higher, you run lower risks of delayed shipping past Christmas.
In addition, make sure to confirm order processing times with your suppliers, since your customers count delivery time from the day they placed the order.
Confirm clearly your supplier’s aftersales policy before Q4. This is to minimize delays in the aftersales process. Be sure that you know the answers to the following questions:
You need a channel to communicate with your suppliers for any emergencies. Maybe your supplier’s team can’t check messages asap in busy times. Maybe there are certain apps that they use more often than others. Figuring that out before Q4 starts will save you a lot of headache.
When your store is truly scaling up, you need a plan to keep everything up and running. There are several things you can prepare right now to ensure a smooth operation in Q4.
Especially if you are pre-stocking with your supplier, make sure your cash flow is in good standing. Be sure you have enough to support your scaling plans. It is also advisable to put aside an additional amount just in case you need more inventory than planned. Remember to confirm payment method and details too.
It all comes down to communications. You should always send clear and honest messages to your customers to manage their expectations. There are several things you should do in Q4.
Make sure you have enough staff to handle higher volume during Q4. Think about customer service, marketing. webpage maintenance etc.
Finally, we are here to remind you of the biggest sales dates in Q4. While marketing and making big sales, don’t forget to prepare your supply chain in advance.
For more on how to prepare your supply chain for Q4, feel free to check out our video here: Q4 Dropshipping Supply Chain Planning 2020 | What to do to plan NOW for Q4 scaling and more profit
If you have 50 orders per day or more and are looking for the best in China fulfillment, and the ideal partner to scale through Q4 with, click get started below to apply to work with us.
Thanks for reading guys. Stay calm and be prepared!