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  1. #1
    Member Lencarl's Avatar
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    Drop Shipping
    Have any members had any experience with Drop Shipping.
    I was looking at several ways to incoperate this type of selling into my niche sites but am not sure if this is the way to start with drop shipping. I noticed several drop shipping sites that deal with everything including hosting and preloaded with thousands of products but I think there must be a better way to include only the niche products to suit my sites.

  2. #2
    ABW Ambassador Boom or Bust's Avatar
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    We do a lot of dropship sales mixed with inventory items mixed with affiliate products on eBay and elsewhere. I recommend joining worldwidebrands[.]com to source products. You'll need a complete ecommerce website as you will be receiving payments.
    If you can specialize in specific products or product categories and include pertinent related information, you'll do better in the SERPs.



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  3. #3
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    Dropshipping I have done
    LenCarl,

    Affiliate marketing I have not done. Drop shipping I have done.

    To start, Boomers is right about worldwidebrands. It is a good start. But the problem with worldwidebrands and any dropshipping list/source network, they have a few real good solid drop shipping companies in their haystack of companies. But as far as a recommendation of WWB, I would recommend them #1 for companies that maintain lists of drop shippers.

    Whatever you do, stay away from companies that dropship everything on the planet from their 'warehouse'. Many of these are just middlemen anyway.

    If you go through the companies at WWB, you can find companies that carry 1 product up to thousands. So it is easier to tailor your sites to a niche.

    All that said, there are a ton of companies out there on the web that will drop ship, but are not listed in any directory. And if you work a little harder to find them, via searching, then your competition will likely not be as thick as it would be if that same company was on a drop ship list.

    In fact, I have found companies will drop ship that do not say so on their website. But if you are interested in a product, and you contact them via e-mail, sometimes you might be pleasantly surprised.

    I really need some starter help to affiliate marketing. So I would be happy to discuss anything I might could help with from eCommerce dropshipping perspective. Are there any good AM mentors out there?

    Later.

    Bryan Robinson

  4. #4
    Newbie Diablos's Avatar
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    I have had success with drop shipping but it got a bit too over saturated on ebay.
    If you work hard to make a good website you can easily make money doing it, much easier to do than inventory shipping anyway.

    TBH I recommend you do some affiliate marketing first and get sued to building websites that sell and then move onto drop shipping

  5. #5
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    We had a shop that used dropshipping but we also carried our own inventory. Dropshipping was definitely a very pleasant experience. Our dropshipper was always polite and helpful and they were almost always in stock. Morover, they would use our company stamp on the packages.

    The downside is that you would be responsible for taking payments and would be susciptible to credit card fraud. The merchant is liable for these purchases and there is a steep learning curve involved in combat fraud. We have now closed our shop and are in affiliate marketing.

    Bryan, if you are already running a successful shop. Then a simple strategy would be to build a shop or shop(s) stocked with affiliate products. Just simply place an affiliate link in the "Add to Cart" button. This would be the simplest approach for existing merchants who wants to go into affiliate marketing.

  6. #6
    Affiliate Manager guinness618's Avatar
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    there are a lot of posts in this forum about the good and bad of drop shipping. do a search and be prepared to spend a few hours reading and visiting the mentioned sites.
    As an AM, I am seeing a lot more drop shipping sites, all with the same products, templates, and pricing structure. It seems to me that the market is getting a bit oversaturated.

  7. #7
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    Quote Originally Posted by guinness618
    there are a lot of posts in this forum about the good and bad of drop shipping. do a search and be prepared to spend a few hours reading and visiting the mentioned sites.
    As an AM, I am seeing a lot more drop shipping sites, all with the same products, templates, and pricing structure. It seems to me that the market is getting a bit oversaturated.
    That could be because there are many folks on ebay selling the templates and stocked carts with the connections to the suppliers and the data already in the cart database.

    Not saying if its bad or good, just saying it's out there and if you want to go that way, research the niche first and see what's already out there.
    Deborah Carney
    TeamLoxly.com BookGoodies.com ABCsPlus.com

  8. #8
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    I actually started my business off dropping shipping and thought it was the greatest thing in the world and then soon realized its the WORST thing ever!!! I gave up a line that was making me 15-20K a year but it sure did come with a lot of problems. I now inventory everything i sell, i know it takes a lot more over head but i personally feel its well worth it.

    Below I have listed a couple problems i had with drop shipping.

    1) Yes there is a benefit since you do not have to sink your hard earned dollars into overhead and inventory but at the same time this means that everyone else has the same advantage. This generally meant that there is always some one who is a little more efficient or willing to make a dollar less then you. Sooner or later you will see more and more people joining in and you are selling a $50 dollar item just to make $1 dollar. If there is ever a problem all your profits are lost, ie damaged goods or returns. (Returns, there generally is a fee to return it to the drop shipper so i end up taking it back to my warehouse)

    2) Your reputation lies in the hands of someone else. During christmas i found items to be short and would never get notified. The customer would contact me and then i would contact the drop shipper only to find out yeah its out of stock. I never wanna put my reputation in a drop shippers hands.

    3) They double invoice you. You will find yourself with a mountain of invoices that you have to go through and believe me, you will find double invoiced items. There is just so much paper work it makes me sick.

    GRRRR - aight im just venting now. Feel free to contact me and i'm sure i can give you more reasons not to do it. I'm certain some people have figured out the art of drop shipping but for me it just wasn't worth the headache. I got my seed money out of it and took all my profits and sunk it into inventory.

  9. #9
    http and a telephoto
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    There are right and wrong business models for everyone This just shows that drop shipping isn't for everyone, but for some people it is perfect. Suppliers you can trust are 99% of a drop ship business.
    Deborah Carney
    TeamLoxly.com BookGoodies.com ABCsPlus.com

  10. #10
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    Smile Drop The Dropshipping In Favor Of Profits.
    I used to do a bunch of dropshipping and it was marginally profitable.

    However, the marginal part was very slim and was most often erased due to the time need to deal with the headaches. ... it always seemed to come down to trading time for the money to buy a big bottle of aspirin.

    So I gave it up for more or less ... I still do it, but the I have learned how to make more money, have less hassles and free up a huge amount of time.

    My present 'Drop Shipper' is AMAZON. They do all the work, keep all the inventory and deal with the money and such. I make a HUGE 4% profit,
    which you all would say vacuums with the best.

    But, if you do the math, the net profit at 4% comes to much more per hour eaned than anything I was making using a drop shipper. Plus, you get even more bonus percentage as your total order volume goes up.

    Since the advent of the great WIDGET adventure, it's money for nothing, but chicks are still overpriced.

    Its take about a hour or so to build a single page with a product widget for a category with your choice of the items you want to feature.

    The time is in searching for the various products to put in the widget. Once you have your product widget done, you spend a bit of time writing some copy to enticing the prospective customer to BUY SOMETHING. Then you submit the page to the search engines and put up some Adwords for the individual products in your widget.

    Hint: Pick products that when you make a sale, your customer gets the FREE SHIPPING.

    Monitor the traffic and sales ... Tweak as needed. Basically it's the same as
    dropshipping with fewer hassles.

    On the other hand, if you go the inventory route and you ship the product.
    You should get an 800# and pay for a sales rep to make the sales when people call in to purchase or for info. The money you pay is more or less what
    you would have paid the dropshipper for acting as the middleman.

    Have fun.

  11. #11
    Resident Genius and Staunch Capitalist Leader's Avatar
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    In a nutshell, it's very hard to find a good dropshipper, that will do it at a price that makes it worthwhile, but there are a few out there.

    Detailed explanation:
    I used to be quite against dropshipping, for some of the reasons stated by Gyoong and Druid. Mainly the reputation aspect: I'd heard of dropshippers screwing things up, and leaving the retailers holding the customer-service bag. Or worse, being outright crooks and not (ever) shipping.

    But a while ago, purely by fluke, I found a place that does both normal wholesale and drop shipping. They didn't advertise that they're willing to do dropshipping at all, but after I had opened communications, they informed me of the option (and seemed surprised when I didn't snap it right up).

    After making enough regular orders and seeing that they didn't screw it up, I was confident enough to let them dropship the items that don't sell enough for me to bother keeping my own inventory of (you know, those onesy-twosy kind of items, often known as "duds")--yet which add up to quite a bit when all of them are put together. However, I still keep inventory of everything that sells at any decent rate.

    I still would not go for any of these "we make a site 4 u" kinds of deals. From what I've seen, that's just like a glorified "we make your affiliate site 4 u," with all its inherent problems: Dup content, products limited to what they sell, 10,000 n00bs trying to make the exact same unrankable thing rank, their site design may suck too much, etc. etc. etc. Not to mention that the kinds of products in those package-deals are often nearly-unsaleable (or completely unsaleable) kinds of things like cheapo plastic knickknacks that nobody'd want. Or if they're not, they're way overpriced, and can be easily beaten by any regular inventory-keeping retailer.

    Not to mention that those "we make you a site and/or fill your site with inventory" companies tend to charge for the not-really-a-privilege of maybe-selling their stuff. I won't deal with a place that wants to charge me just for trying to move their stuff. If I was buying inventory, that'd be one thing...when I'm getting nothing out of it and they're charging anyway, that's a whole different story.

    But, I've realized that not *all* kinds of dropshipping suck, and in some circumstances it can work well--BUT I'm not actively looking for more, either. I still prefer to have the physical inventory here, and KNOW it will be shipped, when it'll be shipped, and how it'll be shipped. Also, the way wholesalers pack things gives me the creeps...most of them seem to think peanuts are made of spun gold or something!

    And, raw-numbers wise, the shipping prices for all the dropshippers I know of are so high they're on a scale from "more profitable to stock the stuff and ship it yourself" all the way to "so exorbitant you could do better if you just bought the thing at full retail and then resold it."

    So I consider dropshipping as something that can be profitable, in limited situations.

    As for what I consider "profitable" enough to bother?
    Quote Originally Posted by Druid
    I make a HUGE 4% profit,
    which you all would say vacuums with the best.
    That is not what I consider profitable enough. 4%, heck, that not only vacuums with the best, it's going for a gold medal at it! You could make more using a standard affiliate program. Heck, I thought Amazon's own paid more than *that!*
    There is no knowledge that is not power. ~Hemingway

  12. #12
    ABW Ambassador Boom or Bust's Avatar
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    We sell a lot of products via dropship. That said, we don't deal with "dropshippers". We deal with manufacturers, publishers, and wholesalers/distributors who happen to dropship at request. Our wholesalers/distributors produce the lowest margins while manufacturers/publishers produce the highest. Our wholesale prices are as much as 45% off with one brand name supplier even for dropshipping and there are no additional fees.

    If your plan is simply to find a dropshipper who supplies a large variety of different products, expect very narrow margins. It's when you specialize and search out a source for a product that you want to sell that you'll see the best margins. Stay away from ones like dropshipdirect or any company that has the word dropship in their name.

    So far we have been fortunate in partnering with reliable sources that fulfill quickly and they handle customer service and returns. The biggest issue is that of available stock. That is mostly a problem with wholesalers/distributors and not manufacturers. There have been times when we sold items and when we ordered, surprise!

    International shipping is a problem with some dropshippers. They either don't, or they end up shipping using a different method than requested. That has cost us money a few times.

    We stock the higher volume products here as Leader mentioned. The larger the quantity you purchase, the better the price you get, the greater margin you realize.



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  13. #13
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    Going For The Gold ... Medal
    Actually, making 4% on Amazon is oftentimes better than an affiliate program
    simply because they actually pay you when you sell something.

    Amazon is just the option I use when I have this evil recurring thought that merchants actually pay you if you partner with them ... Some do, most can't even give away their products.

    Whether it's worth it to deal with Amazon is another question? My take is that for low ticket items probably not. You need to convert beaucoup sales to make any money. On the other hand if you search out the HIGH ticket items and really target the keywords, you can do pretty well. People seem to trust Amazon more than Slick Willie's Plasma TV Bargain Basement when it comes to sending bigger amounts of money.

    If you can make $15 per sale and up and sell one item a day on average you make $450 per month worst case. Get some generic FREE traffic. Spend $10 per day on REAL targetted keywords and you make a profit. Average 2 sales per day and you make something like $600 profit.

    Amazon may not be the best deal, but compared to dropshipping it rocks.
    Also, you would not believe the stuff people actually buy from Amazon when the click thru from some product link ... often it's not that product at all and not even in the same category. All these incidental orders raise your commission rate if you get enough of them.

    Carrying inventory is another story ... you need to have enough stuff on hand so you don't run out and have to wait a week or so to get more. It's a chicken and egg thing ... do I buy 20 widgets or 40 widgets ... will I sell all I buy quick enough so I can turn over my money and not be stuck with a bunch of 'duds,' in the garage or what.

    The actual trick to it all is to sell like you are QVC ... buy it online or call our
    toll free number ... For this you need a call center crew to help you make the sales. It's worth the cost. People LIKE to talk to real people before they send their money.

    If you want to get really low prices on things, try your local liquidators. Usually they are only interested in doing one thing: getting their original money back FAST. If they quote a price, you need to say NO ... but you will pay X for Y number of goods, CASH right now. Ask them what they paid per unit - if they say can't tell you, you say can't buy it from you then. They are only interested in making a profit on what they bought and the faster they turnover their money the more they make.

    It's all a game of who gets what for what and can I sell it after I get it at a profit.

  14. #14
    Resident Genius and Staunch Capitalist Leader's Avatar
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    Quote Originally Posted by Druid
    The actual trick to it all is to sell like you are QVC ... buy it online or call our
    toll free number ... For this you need a call center crew to help you make the sales. It's worth the cost. People LIKE to talk to real people before they send their money.
    I check out call center company sites every so often, but they all seem so secretive about their prices that I always figured it must be an arm and a leg! Or maybe they have the variant version of arm-and-leg, that is, something along the lines of "only 50c a call, with a minimum charge of 10,000 calls per month."

    What *I'd* like to do that's QVC-like is make a TV channel with nothing but my ads on it How uber would that be!!? I always thought TV ought to dump the c*ntent and just keep the ads But instead of boring QVC announcing, put exciting ads on it. And a big order-line number. For TV ads, then yeah...phone number, site, directions to aim smoke signals, and where to send carrier pigeons...pretty much any way that people want to give me their money will do!

    try your local liquidators.
    I bought overstock once, won't happen again. BTW how would you like some gardening gloves?! "Only" 47 pairs left!! Get 'em while they're hot--sale ends in 2108!
    There is no knowledge that is not power. ~Hemingway

  15. #15
    Analytics Dude Kevin's Avatar
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    Leader: Thank you very much for your insightful posts on this topic. I've found myself exploring this option more and more since the NY thing came up, and while it didn't become a top priority, I did find some drop shipping areas where I think I can turn a good profit.
    Kevin Webster
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  16. #16
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    You Have To Negotiate With Call Centers.
    Call centers post prices because they have to ... but for all practical purposes they are negotiable. It all depends on what the incoming call traffic is at the present time.

    It costs about $20/hour to have one representative working the phones.
    That is for all the costs, not just the reperesentative. Now how many incoming calls this rep can handle depends on what you are selling and that sort of thing.

    Typically, you are talking about 10 calls per hour/per rep, if they are selling a product. Maybe twice that if they are doing customer service.

    So, what you have to do is have enough advertising so they get enough calls to keep the rep busy ... or better yet a bunch of reps busy. The closing rates
    are usually pretty good ... so if you can get them enough calls per hour so they can sell 2 deals, you might pay $1/call plus $5 per sale or something like that with a minimum of 500 calls per day. So if you sell 24 deals per day, you need the sales price to be in the realm of $20. The point is that IF you can
    cover your costs plus the call costs with minimal sales, then if you can increase the sale rate even marginally, your profits grow exponentially.

    The call centers NEED to cover the costs of providing the service. Their profits almost all come from number of sales they make or the percentage
    they make of each sale. They are alsways looking for customers who have products that people actually want to buy.

    It's all about the total call numbers from their perspective. The more calls, the more sales they will make.

  17. #17
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    Overstock Stuff Is Not Liquidator Stuff.
    Actually, you need to be real careful with buying overstock stuff ... liquidations often are much cheaper per unit ... but as for the 47
    pair of garden gloves.

    Try this:

    The First 47 people who order the 100 Holland Blub package will get a FREE pair of high quality garden gloves. Then keep track of the sales and post the number of gloves left on the check out page.

    Charge off the gloves to advertising. You get rid of the gloves, make 47 sales and get to write off the cost of the gloves and not have them be considered
    inventory.

  18. #18
    Believe knight01's Avatar
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    Quote Originally Posted by Boomers
    If your plan is simply to find a dropshipper who supplies a large variety of different products, expect very narrow margins. It's when you specialize and search out a source for a product that you want to sell that you'll see the best margins. Stay away from ones like dropshipdirect or any company that has the word dropship in their name.
    It's been years since I did any drop ship stuff and have been exploring the programs for a few projects. Do you have any specific feedback about dropshipdirect? You can pm me if you'd prefer not to say publicly.

    All the drop shippers I've written about have had pluses and minuses but that one seems to have the fewest minuses at this point. Unless I'm missing something... which is possible.

    The way I've approached this on a site I'm working on is that drop shipping is a great way to test a market. Can you generate traffic and eventually sales volume without a huge 'buy-in' of product. Once you get a feel for what sells you can move that product to a wholesaler and self stock it. Using a drop shipper to try and become the next Wally World isn't going to work, but using one strategically in a niche may. Am I way off base on this?
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  19. #19
    Analytics Dude Kevin's Avatar
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    Using a drop shipper to try and become the next Wally World isn't going to work, but using one strategically in a niche may. Am I way off base on this?
    That's currently my attitude, but we could be wrong together.
    Kevin Webster
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  20. #20
    ABW Ambassador Boom or Bust's Avatar
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    It's been a while, but when I was more actively researching dropshippers I found unanimously that the margins with suppliers centered around the dropship model were narrower than otherwise. Dropshipdirect has their act together in terms of automation and merchant ease of use which attracts the dropship wannabees in droves. That's more competition for similar products than I'm willing partake in. And it seems like if you stick to their published MAP, as all good merchants should, you'll find that those who don't honor the MAP will outprice you every time.

    Also, DSDI is not far from here in Lincoln City, OR over on the coast. You have to wonder about a dropshipping company located in a podunk town so far off the beaten path. As those suspicions begin to well up, the thought comes to mind that this guy supplies HIS customers from dropshippers. And not long ago their address was a residence. Not saying it's so, just musing. I did find a Ripoff Report and some other dirt about them. One guy complained that the items he was pushing from DSDI were higher priced than they're selling for on eBay. I've found this scenario over and over with dropship products.

    So rather than go the easy route of a dropship centered supplier, do the hard work of developing relationships with more profitable ones.



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  21. #21
    Resident Genius and Staunch Capitalist Leader's Avatar
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    Quote Originally Posted by Druid
    Actually, you need to be real careful with buying overstock stuff ... liquidations often are much cheaper per unit ... but as for the 47
    pair of garden gloves.

    Try this:

    The First 47 people who order the 100 Holland Blub package will get a FREE pair of high quality garden gloves. Then keep track of the sales and post the number of gloves left on the check out page.

    Charge off the gloves to advertising. You get rid of the gloves, make 47 sales and get to write off the cost of the gloves and not have them be considered
    inventory.
    I suppose some of the liquidator stuff is actually saleable stuff from places who went out of business rather than somebody else's duds, but the problem is that nobody's going to say which is which before you bite it...at least, that's the M.O. I'd expect...

    Your idea may get the gloves out of here, but it'd also leave me saddled with that "cheap-cheap thrift store/cheeseboy latenight ad" image...especially with the countdown meter The problem with that image is that people won't want to pay the full fare once they get that locked into their brains!

    So a week or so ago I put them into a different deal:
    Gardening Starter Kit
    Now check the price on that...$34.95! After all, you would have to go to not one, but TWO Leader's Sites to get all those items if you bought them separately!
    There is no knowledge that is not power. ~Hemingway

  22. #22
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    How Cool Is That ...
    But wait, here is something cooler ... www.sb2000.com

    I was channel surfing and came up a program where they interviewed
    Fess Parker - the actor - about doing business. He is the a big player
    in Santa Barbara and in the wine business .... real good stuff.

    The site is called Small Business University and has a bunch of really
    good information ... and it's all FREE. You might want to check it out.

    And if Leader sells all 47 pairs of gloves, she will make $1645.

    Enough to buy a high rise building in Detroit if the foreclosure listings
    are not lying. On the other hand, one of my friends who is in the real
    estate business is doing research on buying property in Michigan -
    preferably in townships with a college and not in Wayne county.

  23. #23
    Resident Genius and Staunch Capitalist Leader's Avatar
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    But wait, here is something cooler ... www.sb2000.com
    It might be cool for n00bs or those who like video, but I prefer to read...and in my few sample searches I didn't see any ideas mentioned that I haven't already gotten from the Wall St. Journal.

    I looked at that site's (in your link) headlines for "how to retain customers"...no big revs there. Deliver more than they expect, have quality, great CS, fast response, yadda yadda yadda...seriously, if someone doesn't know that they need to go back to the drawing board!! So that's really newb-level. Not that newbs would know that by osmosis, but it's still "first day of class" kind of information.

    For near real-time study of how big companies make (and lose) fortunes, the Wall St. Journal can't be beat. It's like having a (as real-time as a newspaper can be) play-by-play on the moves of the best players of the game! Everything from the basics to the advanced, when it comes to business strategies and the effects thereof, it's in there.

    Enough to buy a high rise building in Detroit if the foreclosure listings
    are not lying.
    What those listings conveniently don't mention is the millions of dollars worth of renovations such a "cheap" highrise must need before it's even safe to go into, let alone rent out the space
    There is no knowledge that is not power. ~Hemingway

  24. #24
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    History Channel Preview ...
    The History Channel had a real cool program, ''Life After People."

    Detroit will have a two century headstart ...
    Even with the people still living there.

    Noobs need information more than most. I agree though, too much video
    is bad for business ... everywhere.

  25. #25
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    There's the Thomas Register if you're looking for distributors, though it's not specifically drop shipping (some may also do that). http://www.thomasnet.com/

    Been around for much longer than these scammy internet lists

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