Apparel Dropshipping: Navigate Increased Competition With Advanced ERP Solutions

The number of retailers and brands using dropship services is rising year on year, with over a quarter (27%) now choosing it as their primary fulfilment method.

Dropshipping is certainly an attractive proposition for fashion and apparel brands, who don’t have to bulk-order inventory that may not sell, or handle distribution logistics. Dropshipped items can prove up to 18% more profitable than fulfilling the same product through an online shop.

But dropshipping also carries risks. Outsourcing picking, packing and shipping to a manufacturer or distributor means relinquishing control over the fulfilment process.

If you’re handling dropship orders on behalf of an apparel brand, you become responsible for:

• Maintaining product quality  

• Speed of delivery  

• Ensuring stock availability  

• Correctly branding and packaging items 

• Resourcing your warehouse to keep pace with demand

Make a mistake with any of these elements and you impact not just the individual order, but the overall customer relationship.

Apparel brands want distribution partners they can rely on to get high quality, correctly branded orders shipped to consumers as efficiently as possible. How can you achieve this? By optimizing your dropshipping process using apparel-specific enterprise resource planning (ERP) software.

Streamlining The Apparel Dropshipping Process

While dropshipping is not a new concept, the expectations from retailers and end customers have evolved. Both parties expect their items delivered quickly, without compromising on quality or service.

As a dropshipping partner, your operational systems affect the speed, accuracy and scalability of the services you can offer. For example, manually entering or re-keying customer data to process dropship orders will slow you down.

The easiest way to streamline the picking, packing and shipping process for dropship orders is through an apparel ERP system.

ERP technology enables you to pivot between wholesale, batch and dropship orders. But in the current competitive landscape, it’s not a case of “ any ERP will do the job.”

Generic ERP systems often require customizations to deliver complex fulfilment functionalities. In contrast, an apparel-specific ERP solution with omnichannel fulfillment functionality easily manages many different order types from wholesale and customer orders.  As well, it seamlessly integrates with major ecommerce solutions like Shopify, Magento and Amazon to help you offer best-in-class services.

Balancing Efficiency and Profitability Using Apparel ERP

Apparel ERP software plays a pivotal role in balancing efficiency and profitability for dropship orders. You don’t want to get involved in a race to the bottom trying to become more competitive.     

A specialist apparel ERP solution helps you make profitable decisions when managing dropship orders. Dedicated industry features allow you to:

• Track and manage raw material, production and delivery costs to make strategic decisions based on real-time data

• Align orders with up-to-date stock information so you’re not making promises you can’t keep

• Create variants for color, size, dimension, prepacks and label codes, so you’re ready to mobilize orders when they come through

• Eliminate data siloes between your vendors, warehouse and financial teams for accurate financial planning

• Earmark product quantities for different customers to protect your most valuable relationships

You can also fine-tune the dropship process through your apparel ERP. For example, generating order information on one configurable pick ticket or packing list to remove multiple labels (and their associated costs).

Meeting the Technology Expectations of Your Retail Customers

There’s a strong internal business case for using apparel ERP software. And your organization may also find a favorable external business case too, as customers demand the latest technology.   Many apparel brands stipulate their dropshipping partners should use certain product information management systems to facilitate dropship orders.  If you’re relying on legacy technology, your ERP software may not be compatible with their demands. Or you may need to integrate newer software, which could prove costly and complex.   In contrast, cloud-based apparel ERP software can easily integrate with major ecommerce solutions like Shopify and Magento, enabling rapid transfer of information to fulfil dropship orders.

Most fashion manufacturers and wholesalers also integrate their ERP system with EDI software to send real-time inventory levels to their retail clients. This ensures order and shipping information is accurately communicated to meet end customer needs.

There are also value-added benefits when running your dropshipping services through an integrated apparel ERP system. For example, you can analyze customer order data to identify trending products across your customer range. You can then prioritize production of these items to ensure drop ship orders are not compromised by out-of-stocks.

Leveraging Technology for Dropshipping Success

There’s a huge opportunity in fashion and apparel dropshipping, but it’s hard to tap into that opportunity without a trustworthy technology stack.

84% of online retailers say establishing a relationship with a dropship supplier is crucial to success. Implementing the right apparel ERP system can be the key to building and maintaining those crucial relationships.

Want to know more about rising to retailers’ expectations? Read our guide to mastering dropshipping part one and part two.

You can also download our ebook on automation in apparel manufacturing for a deeper dive into how technology underpins success.