e-commerce Supplier deliver direct to customer

[bazzaford]

We are looking at setting up a e-commerce store where UK customers can order designer products via our website. All products are made to order in Italy.

We would like to instruct our supplier(s) to begin production of the goods as soon as the order is placed and payment received. However we do not want to first receive the completed goods in the UK ourselves before forwarding to the end client. We are rather looking to liase and arrange delivery with the suppliers to deliver good directly to the end Client. ie: we will not actually see the completed product.

Is this a delivery model that is commonly used ? Or is it very unusual not to take delivery of goods first?

Thanks
Barry

 

[milian]

That's dropshipping - selling products you do not hold in stock and deliver straight from supplier/manufacture.

It's a very widely used business structure and is common practice.

 

[TotallySport]

what happens when they don't like it want to return it? which that can do under DSR?

 

[bazzaford]

Similar to drop shipping but once the product is completed by the supplier, we will make all transport arrangements (not the supplier) for collection from supplier to deliver directly to end consumer. All communication with the client will be retained by us.

Any returns will also be handled by us, but retuned directly to the supplier less transport costs, who will under our supplier agreement provide us with the allowed refund. We will then refund the end customer.

I have a question around drop shipping, does the seller ever actually take ownership of the product, or does ownership only transfer from supplier directly to end customer?

 

[Paul Kelly ICHYB]

Barry,

it is a model that is not commonly used, due to high unit cross border logistics costs, however, if you can over come this, it is an exellent way forward as your UK logistics costs are kept to an absolute minimum, however, your supply costs will, obviously, increase.

BTW, if all the items are yours, it is not drop shipping!

 

[milian]

what happens when they don't like it want to return it? which that can do under DSR?

Barry mentioned the products are 'made to order' - if they are made to order to your customers specifications then the customers have no rights to return under DSR.

As stated in 'guide for businesses on distance selling' from the OFT


Instances where cancellation rights do not apply
(Regulation 13)
Can consumers cancel an order in any circumstances?

3.38. Unless you have agreed that they can, your consumers cannot cancel if the order is for:

the supply of goods made to the consumer’s own specification
such as custom-made blinds or curtains. But this exception does
not apply to upgrade options such as choosing alloy wheels whe
buying a car; or opting for add-on memory or choosing a
combination of standard-off-the shelf components when ordering
a PC, for example

 

[milian]

Barry,

it is a model that is not commonly used, due to high unit cross border logistics costs, however, if you can over come this, it is an exellent way forward as your UK logistics costs are kept to an absolute minimum, however, your supply costs will, obviously, increase.

BTW, if all the items are yours, it is not drop shipping!

That's not correct. If you are shipping products direct from supplier/manufacturer that is dropshipping, whether you owned the products before the customer purchased them or not.

 

[goldenspiralstudios]

If i'm not mistaken i think your doing a B2B kind of ecommerce. If the trademark is yours and you just hire suppliers to manufacture the product then that's what you're doing. The only difference is the delivery which is very convenient.

Cheers!
Goldenspiralstudios.com
Free One-Click Cart Checkout

 

[TotallySport]

Barry mentioned the products are 'made to order' - if they are made to order to your customers specifications then the customers have no rights to return under DSR.

As stated in 'guide for businesses on distance selling' from the OFT


Instances where cancellation rights do not apply
(Regulation 13)
Can consumers cancel an order in any circumstances?

3.38. Unless you have agreed that they can, your consumers cannot cancel if the order is for:

the supply of goods made to the consumer’s own specification
such as custom-made blinds or curtains. But this exception does
not apply to upgrade options such as choosing alloy wheels whe
buying a car; or opting for add-on memory or choosing a
combination of standard-off-the shelf components when ordering
a PC, for example

Products that are customised are not covered under DSR, but made to order standard products are, it depends on what the OP is doing.

 

[milian]

indeed, depends if he products made to his spec to sell to or his clients specs.

 

[milian]

I have a question around drop shipping, does the seller ever actually take ownership of the product, or does ownership only transfer from supplier directly to end customer?

Can work either way. You may purchase a large volume of stock from a supplier but have no way to store it, so they ship it direct; or more commonly you put an order with the supplier when you get an order.