Overview

Drop Shipping is a supply chain management method that allows retailers to sell products without holding inventory. Instead, the retailer transfers customer orders and shipment details to a manufacturer, wholesaler, or another retailer, who then ships the goods directly to the customer. In iVendNext, Drop Shipping is a seamless feature that simplifies the process of managing orders, reducing the need for inventory storage and minimizing operational costs. This article provides a comprehensive guide to understanding, setting up, and managing Drop Shipping in iVendNext.

1. What is Drop Shipping?

Drop Shipping is a retail fulfillment method where the retailer does not keep goods in stock. Instead, when a customer places an order, the retailer purchases the item from a third party (usually a manufacturer or wholesaler) and has it shipped directly to the customer. This method is particularly useful for businesses that sell expensive or bulky items, as it eliminates the need for inventory storage.

Key Benefits of Drop Shipping

• No Inventory Costs: Retailers do not need to invest in inventory, reducing storage and holding costs.

• Wide Product Range: Retailers can offer a wider range of products without the need to stock them.

• Scalability: Drop Shipping allows businesses to scale quickly without the constraints of inventory management.

2. When to Use Drop Shipping

Drop Shipping is ideal in the following scenarios:

• Expensive Products: For high-value items where holding inventory is costly.

• Bulky Items: For large or heavy items that are expensive to store and ship.

• Custom Orders: For products that are made-to-order or customized.

• Testing New Products: For businesses looking to test new products without committing to inventory.

3. Setting Up Drop Shipping in iVendNext

Setting up Drop Shipping in iVendNext involves configuring items and suppliers to ensure that orders are fulfilled directly by the supplier. Follow these steps to set up Drop Shipping:

3.1 Prerequisites

Before setting up Drop Shipping, ensure that the following are in place:

• Supplier: The supplier who will fulfill the Drop Shipping orders must be added to the system.

• Item Configuration: The items to be drop-shipped must be configured correctly in the item master.

3.2 Step-by-Step Guide to Setting Up Drop Shipping

1. Configure the Item:

• Go to the Item Master and select the item you want to set up for Drop Shipping.

• Disable the Maintain Stock option since the item will not be stocked in your warehouse.

• Enable the Delivered by Supplier (Drop Ship) option.

• Select the Supplier who will fulfill the order.

2. Create a Sales Order:

• Go to Home > Selling and create a new Sales Order.

• Select the customer and add the drop-shipped item to the order.

• Ensure that the Delivered by Supplier option is enabled for the item.

3. Generate a Purchase Order:

• From the Sales Order, generate a Purchase Order for the supplier.

• The supplier’s details and the customer’s shipping address will be automatically populated.

4. Track Delivery:

• Once the supplier ships the item, you can track the delivery status directly from the Sales Order.

• Update the customer with the tracking information.

5. Invoice the Customer:

• After the item is delivered, create a Sales Invoice for the customer.

• Record the payment once the customer settles the invoice.

4. Managing Drop Shipping Between Subsidiary Companies

In some cases, businesses may have multiple subsidiary companies where one company handles sales and another handles inventory. iVendNext allows you to manage Drop Shipping between subsidiary companies efficiently.

4.1 Scenario

• Company SAS: Handles clients and sales orders.

• Company BV: Handles stock purchases and fulfills orders.

4.2 Steps to Manage Drop Shipping Between Subsidiaries

1. Create a Sales Order in SAS:

• Company SAS creates a Sales Order for the customer and enables Drop Shipping for the item.

• Add Company BV as the supplier.

2. Generate a Purchase Order for BV:

• From the Sales Order, SAS generates a Purchase Order for Company BV.

• The shipping address will be the customer’s address.

3. Fulfill the Order:

• Company BV fulfills the order from their stock and ships it directly to the customer.

4. Invoicing:

• Company BV invoices Company SAS for the order.

• Company SAS invoices the customer and records the payment.

5. Key Features of Drop Shipping in iVendNext

5.1 Seamless Integration

• Drop Shipping integrates seamlessly with Sales Orders, Purchase Orders, and Invoices, ensuring a smooth workflow.

5.2 Real-Time Tracking

• Track the status of Drop Shipping orders directly from the Sales Order, providing real-time updates to customers.

5.3 Supplier Management

• Easily manage multiple suppliers and configure items for Drop Shipping, ensuring efficient order fulfillment.

5.4 No Inventory Overhead

• With Drop Shipping, you can offer a wide range of products without the need for inventory storage, reducing operational costs.

6. Best Practices for Drop Shipping

1. Choose Reliable Suppliers: Partner with reliable suppliers who can fulfill orders promptly and maintain product quality.

2. Communicate with Customers: Keep customers informed about the status of their orders, especially when using Drop Shipping.

3. Monitor Supplier Performance: Regularly review supplier performance to ensure timely delivery and customer satisfaction.

4. Leverage Reporting: Use iVendNext’s reporting features to analyze Drop Shipping performance and identify areas for improvement.

7. Conclusion

Drop Shipping is a powerful feature in iVendNext that allows businesses to sell products without holding inventory, reducing costs and improving scalability. By following the steps outlined in this article, you can efficiently set up and manage Drop Shipping, ensuring seamless order fulfillment and customer satisfaction.

Whether you are a small business or a large enterprise, iVendNext’s Drop Shipping features are designed to streamline your sales process and enhance operational efficiency. With advanced features like real-time tracking, supplier management, and seamless integration, you can take your business to the next level.