Drop shipping has also featured prominently in Internet-based home business scams.[8][failed verification] Scam artists will promote drop shipping as a lucrative "work from home opportunity". The victim of the scam will be sold a list of businesses from which drop shipment orders can be placed. These businesses may not be wholesalers, but other businesses or individuals acting as middlemen between retailers and wholesalers, with no product of their own to sell. These middlemen often charge prices that leave little profit margin for the victim and require a regular fee for the retailer's usage of their services. In 2018, a Gimlet media podcast Reply All investigated the drop-shipping phenomenon. The journalists explored the way that drop-shippers micro-target[9] their client, but also found that micro-shipping itself is a rather dubious industry in that despite the promises of some of the most well-known drop-shipping acolytes, few drop-shippers actually make any profits.[10]
In 2016, Buzzfeed published an article exposing unscrupulous drop shippers in China. The article shows how customers were receiving products that were not as advertised or receiving no product at all.[11]
One effect of drop shipping is that customers who receive a drop-shipped package will realize that they overpaid for the item on eBay, return the item to the manufacturer, then reorder the identical item directly from the manufacturer. The cost of processing the return and the loss of the unsellable returned product can result in significant losses to the manufacturer.[12]
Knock off name brand products being sold by drop shipping wholesalers is another problem. While some of these products may look genuine, they can be spotted by the extremely high profit margins available on them. If colors, styles or other physical characteristics do not match those of the manufacturer, the product is probably a counterfeit. Selling non-genuine products could destroy one's eCommerce reputation and possibly ruin a drop shipping business. It might also cause legal problems
In 2016, Buzzfeed published an article exposing unscrupulous drop shippers in China. The article shows how customers were receiving products that were not as advertised or receiving no product at all.[11]
One effect of drop shipping is that customers who receive a drop-shipped package will realize that they overpaid for the item on eBay, return the item to the manufacturer, then reorder the identical item directly from the manufacturer. The cost of processing the return and the loss of the unsellable returned product can result in significant losses to the manufacturer.[12]
Knock off name brand products being sold by drop shipping wholesalers is another problem. While some of these products may look genuine, they can be spotted by the extremely high profit margins available on them. If colors, styles or other physical characteristics do not match those of the manufacturer, the product is probably a counterfeit. Selling non-genuine products could destroy one's eCommerce reputation and possibly ruin a drop shipping business. It might also cause legal problems
