how to sell on shopify without inventory

selling products online without actually,touching any inventory,commonly known as drop shipping let's,talk about it if you have not seen the,last video here on the channel,go ahead and check that out after this,just because it kind of builds off and,expands on,this specific case study i'm gonna throw,up a quick screen recording of what's,going on you might have seen in the last,video,this is where we took over a store for a,client who's just starting to do a,couple bucks a day in sales,february we took it over february did,about thirty two thousand dollars in,sales,march did about sixty eight thousand,dollars in sales as of when i'm filming,this,which is the same day as of when i film,the other video so march is not even,done yet,april's on track for at least a hundred,we're just helping this client systemize,you know getting things like,automated order fulfillment much cheaper,cost per purchase on the ads,automating all the advertising but also,things like payment processors,so helping them transition off of stripe,and paypal which is going to be huge for,scaling,so in this video i want to talk about,the drop shipping side of things because,there's a little bit of a misconception,this client is currently having some,issues with cash flow,due to paypal holding 100 of funds now,only about 30 to 35,of the total transactions are going,through paypal well when the margin is,40,which is super healthy it's like 1100,bucks a day right now it's great,well there goes your cash flow so the,idea of ordering inventory is now out,the window for this client,now most people think ordering inventory,always means cheaper,right it doesn't because there's,operational costs to hold the inventory,so for example this client we actually,haven't priced out these specifics for,ordering inventory,we dropped their product cost by a huge,huge amount like 35 40 percent,just through one method which was,getting a cheaper,price and faster shipping through our,own private supplier,our private supplier barely up charges,because we send them so much business i,fulfill most of my stuff through them,and that's something that our clients,get to take advantage of so for an,example,i wanted to point this out drop shipping,like we talked about is not dead drop,shipping is not bad,it's all about how you drop ship this,client now has like,seven to ten day shipping or less which,is well under our 14 to 15 day cut off,which is what we,kind of want to max it out at we,definitely want it below that and that's,great,seven to ten days is faster than they,were getting before and,based off doing about twenty seven,hundred to three thousand dollars a day,in sales,this client is saving an extra three,hundred and fifty dollars a day right,now,but now we're not even scaling but,saving 350 a day,right now in pure profit just through,the product cost,not talking about upsells not email,marketing not raising the price not,messing with anything else,350 bucks that's over 10 000 a month,which is over three times the retainer,that this scaling client is on,right we have different retainers to,cover our different packages so for an,example,when you join inside of our agency by,the way you can book a free call for,that down below we talk to everybody one,on one before we talk about different,things that we do,we have multiple different starting,points someone who knows nothing and,they're just starting from scratch,that's where we have to build a store,find all the products we do all the,research and we do all the testing this,client already had a store already had,the product,so we started optimizing and scaling,that means we have more people working,on the project people helping with email,marketing upselling,you know resetting up the store finding,some more similar products working on ad,creatives,helping them assist with like more,systemizing in terms of automated order,fulfillment connecting them with our,processor connecting them with supplier,all these different things right,and then the scaling team for the,facebook ads so,this client in particular is doing a,huge amount of volume,just through not holding inventory now,if we were to hold inventory which,for some reason everybody in the,industry typically thinks that's such a,good thing,if this client tried to order inventory,put it like this the store would die,the reason for that is it's a cash flow,issue a lot of people doing standard,drop shipping can't,hold inventory because places like,paypal are holding 25,rolling reserve this one's holding 100,but 25,rolling reserve then you have 25 over on,stripe,and right there goes your entire profit,margin so there's no free flowing cash,for you to order inventory with now,inventory can be a great tax write-off,it can be great if you can get faster,shipping,makes custom packaging and custom,content a little bit easier,but it doesn't always mean it's cheaper,so for this client i don't think that,they could personally get it any cheaper,so that's one of those great things and,i just wanted to come on here to say,you don't have to hold inventory you,shouldn't this is a weird way to say it,you shouldn't want to hold inventory,right if you can operate just fine by,drop shipping,it's less headache it's less being tied,to the product in any way let's say i've,had so many times,where i wasn't able to sell all the,inventory because something happened,facebook shut us down and now i'm stuck,with 3 200 units,which cost like you know 36 000 and it's,just,it's one of those things you know so,this is a great way to get the ball,rolling with a new business,i have no doubt that this client as long,as they stick with us throughout this,year,and you know not to sound cocky or,anything but as long as they just you,know kind of let us do our thing and,listen to what we say and they're,they're very minimally involved as we go,on you know they don't have to do a ton,of stuff i have no doubt that this will,do a couple million dollars in revenue,this year with probably a million,dollars in profit as we scale more,aggressively,i expect that 40 margin to probably go,down to like 32 to 35,might go down to 30. i'm totally fine,with that as long as we're able to scale,as soon as they get approved for the,processor which i talked about those,issues in the last video,as soon as that happens they're going to,be able to be scaled because they don't,have to use paypal which is holding 100,of the funds they don't have to use,stripe,they're going to have no hidden reserves,no lower fees actually in terms of the,transaction rate,and faster payouts next day payouts so,that'll be super helpful cash flow is,very important in the business that is,why drop shipping,is a great way to get inside of the,ecommerce space i just wanted to come on,here and talk about that a little bit,and build off of the example that we,talked about in the last video so,be sure to check that video out as well,if you want to work with our agency and,see exactly how we structure things,make sure to click the top link in the,description it's absolutely free to,speak with someone inside of our agency,you can talk to a client manager and,they can walk you through exactly what,it looks like,because they manage every single client,scaling clients beginner clients,intermediates,you know we do a lot of different things,but it's mainly focused around,automating the advertising and just,helping you make a bunch of money with,e-commerce so,we have a lot of fun doing that we take,a retainer based off what we're doing,how many people are working on it to,cover our cost and then we take a,percentage of profits you know,just just being as open and transparent,as possible we as an agency we'd like to,make 500 000,a year or more just off this client that,would be awesome because that would mean,based off our average like 30,profit share that this client just,netted like 1.7 million dollars or so,which is great you know someone who's,never really been inside the e-commerce,space and this is kind of the first,store getting going,can net over a million dollars even,after paying us in the first year and,that'd be really cool so,we'll see what happens with this it,would definitely not be a unique,situation we've had a lot of clients do,500 000 in a month a million in a month,and it's super cool to see,i love it when things come together so,i'm excited to continue posting more,videos on the channel if you have,questions or,video topics that you want to see,addressed here make sure to leave it in,the comment section down below don't,forget to smash a quick like and with,that being said,we'll see you in the next video peace

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