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Which payment methods can be used with Drop Shipping

Which payment methods can be used with Drop Shipping

It is clear that a good product catalog is not enough to guarantee success.

Although DropShipping systems, in fact, favor the creation of an ecommerce without significant investments, one of the main factors that largely determines its success is undoubtedly the payment system offered.

Whether you are a seller or a supplier, the broadest offer of payments will surely satisfy a larger number of customers.

Now you list the main methods used by the biggest dropshipper worldwide.

PayPal™

PayPal™

This method is used thanks to one of the safest Internet payment platforms. It allows you to link payments to a credit or debit card, or even to a bank account. It has a variable cost payable by the supplier which goes from 1% to 3.4% (+ € 0.35 per transaction). Precisely because of these additional costs, some suppliers propose it with an additional cost of about 1% on the total invoice (even if this practice is illegal, as specified by the Antitrust Authority and the Consumer Code)..

Credit Card

Credit Card

This method can be used and combined with your ecommerce, thanks to specific gateways, like Stripe or through the PayPal service itself. By virtue of the operator used the costs could be different, and have monthly fees. These costs are always charged to the supplier.ore.

Bank Transfer

Bank Transfer

This method of payment is made by sending a simple bank transfer. However, even if it turns out to be the most convenient, delays the order evasion of a few days because (except for some types of special transfer) the payment crediting is not immediate and both the seller and the supplier will confirm the progress of the payment only paid order received. In most cases (with a risk borne by the seller) it is possible to speed up the time of order processing by sending the bank transfer receipt.

Money Box

Money Box

This method is intended as a real digital piggy bank that the seller will open at the supplier. The piggy bank can usually be recharged by bank transfer or credit card. Orders will be processed immediately and the remaining balance will be used for subsequent orders. Quick, convenient and without additional charges.

Cash on delivery (payment on delivery)

Cash on delivery (payment on delivery)

This method allows the end customer to be able to pay directly in cash to the courier. It is the mode most requested by users in some countries (for example Italy or Bulgaria), but it is not always authorized by the suppliers. The total order paid by the end user to the courier will then be turned into the money box of the seller "money box" after having scaled the costs of the goods and the additional services that can vary from 1% to 3%..

As you can see there are different payment methods, some safer, some quicker.
And it is precisely the speed in receiving the payment and consequently in the processing of orders that could make the difference.

In the era where large marketplaces are experiencing delivery in a few hours, propose weekly deliveries, certainly will not make you prefer to other sellers .. do not you find ?!

However now that you have seen what types of payment are available, you just have to figure out which ones are cheaper and safer for you and your customers.

Which payment is cheaper for sellers in DropShipping?

What determines the convenience in a payment is undoubtedly its "cost".
Higher "cost" menas higher fees that the bank requires and lower income!
In fact, for every collection, the bank immediately takes its commission, leaving to you a net value that is lower than the amount paid by your customer.

For example: One of your customers spends € 100.00 to buy a pair of glasses on your site. Once your order is complete, your customer pays 100.00 € with his credit card.
On your account, however, there will not be an asset of € 100.00, but this will be deducted bank commission fees (example 3%), so you will have a net receipt of € 97.00 [€ 100.00 - (3% of € 100.00 ) = € 97.00].

As you can see the "cost" of a payment is inversely proportional to your collection, so inevitably you must always choose a payment favorable to you, or with the lowest "cost" on the market.

However as mentioned before, a cheaper payment is not always the fastest to receive.

What is the fastest payment to receive for DropShipping sellers?

If payments with "credit card" (PayPal, Credit Card, Money Box) are almost immediate, payments by bank transfer or cash on delivery are slower to receive;
a bank transfer can take from 2 to 5 days to be credited by virtue of the fact that the issuing bank is European or international;
a payment on delivery instead, can take up to 10 days, this is because the person in charge of sending the payment is the same courier who collected on your behalf when the shipment was delivered.

Last but not least is the security factor in payments. Scams and scams are always around the corner, so it is important to be aware of what is offered.

What is the safest payment for DropShipping sellers?

It is important to first rely on common sense. Would you give money to the first street vendor you find on the street, without knowing it and without immediately receiving the purchased goods?
The Internet is full of more or less real virtual stores and many of them do not even have a detailed exposure of their company. They are real itinerants parked in the ether without a real home, and if you want to report to them it is advisable to take the proper precautions.

Of course I'm not saying that your store is fictitious, a "fake", I'm just trying to make you understand that many people on the internet have been cheated and now, I would rightly add, there is a lot of diffidence around.
Amazon's fortune, on the other hand, is mainly based on trust. Many people buy on Amazon just because they trust the marketplace, so it's important that you offer your potential customers all the means to trust you.

Later, after you have gained confidence you can allow yourself to think differently, but this is another matter and we will talk later in another article.

Some payments, in fact, offer protection from fraud and in large part the use only deters them.

In addition, giving the final customer the possibility to choose a "protected" payment or a "traditional" payment will certainly make you gain confidence, to the detriment of additional costs (fees) that will inevitably be at your expense.

In conclusion, what is the best payment for those who sell in DropShipping?

This guide does not have the burden of "unveiling the sacred grail" but only wants to provide some basic information useful to those who approach dropshipping without real literacy in this regard.

You will be the ones to choose the payment methods that you want to offer to your customers, I will limit myself, after providing some theoretical concepts, to illustrate a summary comparative scheme of the payments mentioned above.

PayPal

PayPal

Availment

customer / seller

Fees

3.4% + 0.35€*

Accreditation speed

immediate

Safety

great
Carta di credito

Carta di credito

Availment

customer / seller

Fees

3.4% + 0.35€*

Accreditation speed

immediate

Safety

sufficient
Bonifico bancario

Bonifico bancario

Availment

customer / seller

Fees

no

Accreditation speed

slow (2/5 days)

Safety

poor
Money Box

Money Box

Availment

seller

Fees

no

Accreditation speed

immediate

Safety

good
Contrassegno

Contrassegno

Availment

customer / seller

Fees

variabile ~2%

Accreditation speed

very slow (2/10 days)

Safety

good

* on important monthly invoices, the banking institution offers significant cost reductions, re-modulating its tariff plans.

Observing the scheme it is clear that there is no payment method par excellence, but especially in an initial phase of sales, just by winning the trust of your potential customers it would be advisable to favor the security of payments and at the same time offer valid alternatives.

And for the suppliers who sell in DropShipping, what is the best payment?

For all payments, the speech is the same for sellers. However, if the seller agrees, an excellent payment system between seller and supplier is the "Money Box", a real digital piggy bank that the seller will open at the supplier in order to facilitate the evasion of immediate order. and minimize (or eliminate them altogether) the costs of bank institutions.

The piggy bank, in fact, will be loaded by the seller preferably by bank transfer (no commissions) and all orders that the seller will generate at the supplier will be paid internally without having to use additional banking institutions (no commissions).

By virtue of the type of credit offered (by bank transfer) it is understood that the seller places a certain trust in his supplier; to tell the truth statistically, suppliers are usually large, reliable companies; on the contrary, sellers can often be improvised and inexperienced.


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