Guide to dropshipping automation

Many people new to ecommerce view dropshipping as a risk-free way to make easy money online. While it’s true that the financial barrier to entry is significantly lower than traditional retail models, the pitfalls of dropshipping (especially in South Africa) are well documented. These include:

• Lower profit margins: As a middleman between the supplier and the customer, your profit margins are likely to get squeezed. Also, because you are regularly buying small quantities, you won’t be getting bulk discounts.
• Competition and market saturation: Low barrier to entry invariably leads to an increase in competition. Finding unique products or niches and standing out from the crowd can be challenging.
• Shipping complexities and times: Shipping lead times and costs can be unpredictable, especially when dealing with international suppliers.
• Supplier reliability and product quality: Relying on suppliers for inventory and shipment means you’re entrusting your business reputation to their reliability and product quality. Issues like stockouts, delayed shipping, or subpar product quality can affect customer satisfaction and retention.
• Inventory management and stock availability: Since you’re not handling the inventory yourself, you’re dependent on your suppliers' stock. If a product becomes unavailable or goes out of stock unexpectedly, it can lead to customer dissatisfaction and lost sales.

With Stock2Shop, you can add an element of automation that reduces the risk of stockouts. If your supplier is prepared to grant access to their inventory database, you can sync live stock (and other relevant data) updates to your website, Amazon, Takealot and other online sales channels. Below is an overview of how it works.

1. Sync data from your accounting system

Your ERP (or accounting system) should typically be your primary data source. Product information is synced to Stock2Shop where you can add marketing material such as images, descriptions and cateogrisation.

2. Sync stock updates from you supplier

Your supplier’s database can be added to your Stock2Shop console as a linked source. This means that inventory and other relevant data can be automatically updated to reflect near-live stock availability. NB: It is important that the item codes on your supplier’s database correlate with the codes on your accounting system.

3. Sync ready-to-go products to your sales channels

Now that your items have synced from your accounting system to Stock2Shop where they have been updated with accurate stock levels from your supplier’s data, you can send them to your ecommerce sales channels. Note: Some platforms limit which data they accept via a product feed. Please check the details with your Stock2Shop sales agent.

4. Sync ecommerce order to Stock2Shop

When a customer buys one of your products online, the order will be sent back to Stock2Shop.

5. Automate invoice or sales order creation

Online orders can be synced into your accounting system (or ERP) as an invoice or sales order. If you sell on multiple ecommerce platforms, each channel can sync orders into its own default debtors account, making reconciliations easier.

With Stock2Shop, you can accept online sales with confidence while knowing that your online sales channels reflect stock levels as per your supplier’s inventory database. Call us now to find out how we can help you reduce the risk of stockouts.