Posted on February 13 2019
If you want to make income reselling products from Green Goddess Supply, there are several different paths available: Drop Shipping, Affiliate Programs and Wholesale sales. If you're new to this world, all of these options can make your head spin!
The purpose of this article is to explain the various tradeoffs, but regardless of which path makes the most sense for you, please understand that we offer ALL THREE options and you can even move between these business models over time when it makes sense.
At the top of the food chain is the wholesale model. This is a very normal, typical retail channel model in which a retailer (such as a smoke shop) buys product for resale. Margins can vary by products and manufacturers, but it's typical to see margins anywhere from 50% on upwards.
Wholesale purchases offer the best profit potential, but come with many drawbacks: the store has to front money for inventory, which can get expensive, and the store has to deal with delivery and returns (less of an issue with brick and mortar stores, but more costly and invasive to deal with returns for an e-commerce venture). The store also has to deal with storing/warehousing products, and paying for shipping materials (boxes, mailers, tape, labels, etc.), postage and labor to "pick and pack" the orders, deal with returns, and more. Inventory management is also a non-trivial issue. As noted, wholesale provides the best margins, but you also incur all of the cost and overhead and headaches of purchasing, storing and forwarding inventory. This makes most sense, however, for physical brick and mortar stores, hybrid online/offline stores, dispensaries, or large ecommerce sites that move enough volume to justify buying in bulk and making the best margins. Our dedicated wholesale website can be found here: https://Wholesale.GreenGoddessSupply.com/
In this day and age of exploding online sales, "drop shipping" has become extremely popular. This business model shifts most of the "cons" of the wholesale business model over to the manufacturer (aka "supplier" or "drop shipper"), with the tradeoff being lower margins for the retailer. However, if you're a smaller operation that doesn't have efficiencies of scale, this can be a net positive because the supplier can probably pick and pack and ship faster and cheaper than you can. Stated another way, you'd probably spend much more than the 25% you give up in covering hidden costs like postage, packaging materials, warehouse space, and cost of label for picking and packing orders.
With drop shipping, the retailer takes an order and then passes it over to the original manufacturer/supplier who ships the product to the end customer on your behalf. The drop shipper (the manufacturer / supplier) will send the item itself in a box or mailer without any branding, offers or literature -- often it's just the product in an otherwise empty box, with minimal shipping information. Here are Green Goddess Supply, we do not use branded boxes or packaging -- we ship a generic brown box, or generic white bubble mailer. As such, the customer generally doesn't know where the product came from - they ordered from you and a box shows up at their doorstep a few days later. End of story.
We use an automated system to automatically funnel the orders from your online shop over into ours, where we pick & pack and ship. Instead of 50% margins with wholesale, drop shipping usually nets about 25% margins. However, the retailer has no other expenses to deal with, no inventory to store, no money to front on inventory, no packing materials to buy, no employees to hire for processing orders, no returns to manage, etc. It's entirely virtual. A single person can operate a drop ship-based website from a laptop and just focus on marketing the site and driving traffic, and leave all of the order processing and logistics to the drop ship supplier.
If you need help designing and building an online store with merchant services, click here for a referral to our e-commerce website building team that offers a low-cost package to get you going.
The wholesale and drop ship business models both assume you have an ecommerce website and are marketing and selling physical products. But there are revenue opportunities for people without e-commerce websites too!
If you're a social media influencer (ie an individual person without a website), or perhaps have an informational website such as a blog or other non-ecommerce site, you can still earn 10% of sales by signing up for our Affiliate Program and simply making referral / recommendations.
The referrals can be as simple as clickable text links, or take the form of more traditional-looks ads.
At Green Goddess Supply, we use a third party affiliate system called ShareASale.com to power our affiliate program. By using one of the original third party affiliate systems that has been around since the mid 90's (we've used them several times in the past on other ecommerce projects, ranging all the way back to 1996), you can rest assured that there's a neutral 3rd party involved to manage and audit the program, handle payment of commissions, and that the account is pre-funded by us, and it's all automated on "auto pilot" - you won't be waiting around for us to do any accounting.
Your promos can use text links, or if you prefer more traditional-looking ad creative (such as for sidebar space on a blog page), we have a whole library of pre-designed ads (banners, square ads, skyscrapers, and more!) loaded up and ready to go for you to use in ShareASale. For details on our affiliate program click here.
As you can probably see now, we've setup a tiered system of wholesale, drop shipping and affiliate sales to offer options for everyone to get involved. It's really just a matter of deciding what you're trying to do, and picking the appropriate program.
Please let us know if you have any questions!