Pay the supplier for dropshipping via your WooCommerce shop

Dropshipping is becoming more and more interesting to people, and there are many advantages to this type of profit-making practice. You just need to take care of some formalities in terms of the day-to-day running. Once this is taken care of, you can start making money from sales.

Why dropshipping requires little investment

The reason dropshipping attracts so many people is because it doesn't take much money to get started. However, this particular detail is not necessarily well explained. Basically, it's possible because of the way your dropshipping works itself, and the limited roles you have.

The supplier takes care of the whole

For this activity, your aim is to find buyers on behalf of your dropshipping supplier. Then you simply take a small commission on top of that. In other words, you're a marketing agent, doing what it takes to make the product sell. Once you've found customers, the following actions are taken over by the supplier:

• Production of the required products
• Their packaging and delivery
• Management of returns if any

So you don't have to bear the expense of these actions, which are expensive. 

Expenditure is only significant at the beginning

When you start your business, you will need to spend some money to set up an online shop. With tools like WooCommerce, you can easily create a site for your business. Then you have to pay for its hosting and the promotion of your product on advertising networks.

As soon as it is up and running, you will not have to make a large number of payments. The sales usually cover your expenses after a few months. So it's a very profitable venture, provided the whole thing works out well.

How to pay the dropshipping supplier via sales

The principle of dropshipping is that your supplier will be paid at the same time as you. You can set up your site so that it receives payment for every sale made. If your site is present on platforms such as Aliexpress or Amazon, you can even set up a direct relay. It's even more convenient this way, because you can take your commission at the same time as he gets paid.

Secondly, the payment method for the dropshipping supplier to use can vary depending on the agreement. The more steps there are for payments, the more it will cost. One situation that can be envisaged is where payments are made to you first. Then, on a periodic basis, you make the payment to your supplier.

By doing this, you will avoid excessive costs. Secondly, when it comes to the details, you need to agree between yourselves. You can choose between the various payment options for WooCommerce to proceed as you please. It is important to evaluate the existing options to decide how the dropshipping supplier is paid.

Find other alternatives with your supplier

It is also possible that your supplier does not place their products on sites like Aliexpress and Amazon. Here, it might be a bit more complicated to act, both to inform them of sales and to pay them directly. Fortunately for this case, it is possible to send him the information of dropshipping purchases from WooCommerce. This way, he will be informed of the orders to be processed, and will be able to take care of the deliveries.

You can use the same systems to share payments directly with him if you prefer. On the other hand, if the products are high value, it may still be profitable for both of you. The best thing to do is to talk to your supplier to find a good deal. Once you have decided what to do, you can set up a proper payment system. For those worried about how to pay their dropshipping supplier with WooCommerce, just install the right plugin. 

Don't forget to keep your accounts

In dropshipping, knowing how to pay the supplier comes with another concern, namely accounting. It is a requirement to keep your accounts in order to pay your taxes properly. However, with all the different payment systems available, you can get lost. You should therefore make sure that you keep track of your accounts on a daily basis.

If it is within your budget, you should even consider using an accountant. This is an investment that will save you time and money. The accountant will be able to prevent you from making tax mistakes that could cost you dearly. Secondly, doing the reconciliation is a tedious and time-consuming task if you are not used to it.

There are service providers who can do this for you at very reasonable rates, often charged by the hour. If you don't want to go through this process, you can always learn the basics. The main thing is that you do not make mistakes in your accounts. 

Conclusion

The question of payments to be made to the supplier should be clarified with the supplier as soon as possible. This will allow the business to run smoothly, and there are several WooCommerce tools to help you. With the Minea platform, be aware of the essentials when it comes to running a dropshipping site.