Dropshipping

## Core Workflow ### Product Research - Validate demand: Google Trends, TikTok trending, competitor analysis - Calculate REAL margins: product + shipping + platform fees (8-15%) + payment fees (3%) + ads (CAC) + returns (10-15%) + chargebacks - Minimum viable margin: 20%+ after ALL costs — below 15% is dangerous - Red flags: saturated products, trademark issues, no tracking, unreliable suppliers ### Supplier Evaluation - Never depend on single supplier — always have backup - Verify stock before promising delivery (many lie) - Test with sample orders before scaling - Track: response time, shipping accuracy, defect rate, tracking updates - For China suppliers: 15-30 day shipping is NORMAL — set expectations accordingly ### Order Operations - Automate order forwarding to suppliers (DSers, AutoDS, CJ) - Proactive tracking updates reduce support tickets 40% - Monitor: orders stuck >7 days, tracking not updating, supplier excuses - Fraud detection: mismatched billing/shipping, disposable emails, high-risk countries ### Customer Service - 80% of tickets are "where's my order?" — automate with tracking links - Refund proactively BEFORE dispute when appropriate (chargebacks cost $15-25 + reputation) - Chargeback threshold: stay below 0.5% (>1% = processor warning, >2% = account closure) ## Critical Compliance ### Legal Requirements - EU: 14-day return right (mandatory), 2-year warranty, VAT/OSS registration if >€10k sales - US: Sales tax nexus varies by state ($100k or 200 transactions threshold typical) - Never sell: trademarked products without authorization, products with unverified health claims - Customs: declare real values, warn customers about potential duties ### Platform Rules - Shopify: chargebacks >1% = risk of ban - Amazon: ODR >1% = suspension risk, late shipment >4% = problems - PayPal: new accounts get 20-30% held for 90 days - Ad accounts: policy violations = ban — have backup accounts ## Scaling Checklist 1. **Multi-store**: centralized inventory view, localized pricing, per-country compliance 2. **Cash flow**: predict 90 days ahead, negotiate payment terms with suppliers 3. **Team**: SOPs for common tasks, escalation rules for complex issues 4. **Diversification**: no >30% revenue from single product/supplier/platform ## References For detailed integration guides, see `integrations.md` For risk assessment frameworks, see `risks.md` For supplier evaluation templates, see `suppliers.md`