For quite awhile now small online and catalogue mail order businesses have been relying on drop shipping to fill their customer orders. For those still unfamiliar with the process it works like this; let’s say an online store sells digital cameras and uses a drop shipper to fill these orders. When a shopper purchase a camera the merchant passes the order along to his or her drop shipper. The shipper fills the order and ships the camera to the customer. The key element here is that the merchant sold a camera they never actually possessed or spent any money on until it was already sold.The advantages of never having to keep inventory are obvious. Never paying for storage or having money tied up in obsolete merchandise is a wonderful thing. There are subtler benefits as well. Consider a business that has considered selling an expensive product like fine jewelry but rejected the idea because of the cost of insurance. Knowing it would be foolish to keep an uninsured inventory of jewelry the business owner is forced to abandon a potentially profitable enterprise. Using a drop shipper that expense is carried by the supplier.Having someone else handle the headaches of inventory and shipping frees the merchant up to concentrate their energies on other facets of their business. New avenues of advertising, direct sales, and new products line can all be explored by a business free of the economic and time drains of inventory and shipping.Of course the supplier enjoys a number of benefits as well. Much of the expense of marketing their products is shared among the many small merchants that use their service. The small merchant drives customers to the suppliers they would never have found on their own.Nothing in this world is perfect however and drop shipping does have several down sides. Other people will not perform such vital elements of your business for free. Although the costs may seem very comparable between using a drop shipper and having the inventory your self but drop shipping is more expensive. In the long run a business’ margin will be narrower using a drop shipper.Returns and other faulty merchandise customer issues can be an absolute nightmare with drop shippers. These are big companies and trying to resolve a customer’s damaged order problem will involve listening to a lot of hold music. Normally drop shippers will neither refund the customer’s shipping charges or the merchant’s on a return they do except. Sometimes they are simply impossible to resolve and the small merchant will probably have to eat the cost.The inventory listings a merchant receives from their drop shipper often not up to date, despite usually being done daily, and their systems rarely detect sales trends. The results being that there are sometimes problems with seasonal items and products enjoying sudden popularity. It may look as if your drop shipper has plenty of graduation caps and gowns when in fact they do not and will not have more in time to make any difference.There are things a merchant can do to make sure that they chose the best shipper available. The first thing to do is shop online. Drop shippers have unusually informative websites that clearly explain the company’s policies and costs. Read these carefully, policy page are intentionally made dull and lengthy but some amazing things can be hidden in them. Avoid any company that does not have clear policies or just offers little real information about itself.There are dishonest drop shippers out there that will merely pass your order on to another legitimate shipper and the additional cost on to you and your customer. These people should be avoided like the plague.All reputable drop shippers will have telephone customer service and be willing to answer any question you might have. Ask how often they ship they wrong product. They will know the answer to this question and should tell you. Beware of any outrageous claim of 100% accuracy. Even if you have read their return policy on their website have them explain it to you on the phone in detail. Besides clearing up any questions you’ll get a good idea of the level of customer service you can expect from the shipper.Place an order to be shipped to you or someone nearby in order to get a look at the packaging, see what your customer will see. You want to make sure that your product is not covered with tags from another retailer and that the box is free of inserted advertising for another retailer.The box should include a packing slip with your company’s name on it. Some drop shippers will even put your name on the shipping labels. In most cases your customer will never suspect their purchase did not come directly from you. A good drop shipper is an unobtrusive one.Art Mickelwraith is the author of the Wholesale Buyer’s Guide at TopTenWholesale.com. He can be reached at artmicklewraith@gmail.com.