The example above using music CDs is a simple way of explaining concept of drop shipping, however practically speaking you will probably find that CDs are not best product to sell online. That’s because you will be in competition against companies like Columbia House that can afford to sell 10 CDs for a penny. They make their money back in end, but only because they are able to purchase CDs at an extreme discount. Whereas you are buying CDs for $9.99, they might be paying only $2 per copy.

The same limitation applies to other “commodity” items like electronics, video games, and software. There are lots of competitors out there that can purchase same items for less money, so you should try to think of niche products or value-added services that differentiate your website from others.

There are quite a few dubious organizations out there that claim to have lists of Wholesalers that will sell to home-based market. Unfortunately most of them are not legitimate. Worldwidebrands.com has an eBook that covers most of what you need to know about drop shipping called, "Starting Your Internet Business RIGHT" and it can be downloaded for free Here.

In conclusion, drop shipping should probably be considered as a start-up activity. Your goal is to test different marketing programs against each other, get your website ranked on search engines, and build your business volume up. Once you get your site established and have a healthy volume of traffic flowing through your site, you should be able to gauge profitability of establishing an account with a full-blown distribution company. After all, drop-shipping alternative is an inexpensive way to get started in your business, but it is not most profitable way to purchase goods once you have a full-volume business developed.

Never allow yourself to become discouraged. Just remember... The more "NO's" you get, closer to a "YES" you come. You must go through NO’s to get to YES’s.

Scheduling your time so that you use it wisely is your roadmap to success. If you don’t have direction, you'll travel in circles and ultimately never reach your goals. Plan your work then work your plan.

Like most direct marketers you are most likely to work from your own home, but it is still essential to set up a specified work area. Take pride in your business to ensure your success.

A fool and his money are soon parted so make sure you set up a written budget. You MUST set aside a percentage of your business income to re-invest in your business. Failure to reinvest your money will result in failure of your business.

Look after No one, YOURSELF! Make sure you get plenty of sleep, eat right and take some time out to take in scenery.

If nothing else take this away with you:

BE PERSISTENT, it pays off

DO NOT GIVE UP! It’s a known fact that most Businesses fail just when they are about To SUCCEED...