Dropshipping - a tool for testing demand
The direct-delivery market will continue to grow steadily over the next 5 years. This means dropshipping will continue to be popular as a simple and affordable online business model. Retailers and distributors are using dropshipping to expand their assortment and test demand by buying small trial batches of merchandise.
Demand testing helps businesses make informed decisions about cash flow, resource allocation, and marketing costs.
By constantly experimenting and observing the actions of competitors and correctly identifying trends, you can identify a whole group of products for which there is already or is predicted to be an increased demand. At the same time it is necessary to take into account seasonality and to prepare for sales of seasonal goods at least one month in advance.
Retailers typically forecast demand based on experience, sales history, trend preferences and seasonality. This approach allows for efficient supply chains. After testing demand, the retailer makes the final decision on whether to make wholesale purchases or whether to continue selling the product through the dropshipping scheme.
In dropshipping, you can sell by adjusting to the "situation" in the market, or create the need yourself, promoting and advertising the product, the demand for which needs to be formed. In other words, sometimes creative solutions become value-added products.
The Betonlogos marketing platform is a quality and powerful tool for effective demand planning, which helps manufacturers, retailers and distributors to calculate the economic feasibility of the transaction and to plan revenues.
Forecasting
Data Collection
The minimum amount of data needed for effective demand planning is information on transactions and sales over the past 3 years. This gives an idea of which items are seasonal and which are ad hoc and ad hoc. With Betonlogos company's tools, it's fairly easy to import sales history from spreadsheets, databases, ERP or accounting systems.
Demand Planning
Demand planning analyzes the data received and decides from which supplier and in what volume to purchase goods. The connection of the Betonlogos program allows a continuous analysis of demand and sales results.
Planning of deliveries
At this stage, they develop a plan for working with suppliers, plan the logistics of supply, calculate the budget, and forecast revenues. Based on these data and the final decision on the feasibility of further steps, key performance indicators are taken into account.
Marginality
While testing the demand, do not forget to calculate the margin of the goods. With an income of less than 30% cooperation will not be profitable.
Direct delivery orders
Study the demand for certain goods by analyzing the number of queries in search engines. After that, start looking for suppliers from whom you can buy high quality goods. It is important to the dropshipper that the merchandise that is supplied on behalf of your store and brand is of high quality, has certificates and warranties. Your customer needs to become your loyal customer, and in order to do that, they need to get not only high quality merchandise, but also quality service. When fulfilling direct-delivery orders, suppliers must be prepared for more orders and shipments.
Betonlogos company tools
If you choose demand generation tactics that don't respond to customer behavior but guide it, you can motivate customers to make purchases with the right marketing campaigns, promotions and special offers. In this case, demand planning is easier, you can act instantly and effectively. Betonlogos tools simplify testing processes with their precise prioritization of tasks to be performed.
Demand testing markedly improves the accuracy of business planning allowing retailers to effectively manage their product offerings, inventory levels and logistics solutions, significantly increasing profits.
Other BetonLogos company's articles
Quick links
Join to us
Contact Us
Adress: Dlouhá 715/38, Staré Město, 110 00 Praha 1