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Dropship and the Logistics Provider
In 2012, I wrote about the end delivery process in drop shipping. Next, my target was to walk back up the chain and find a company that was manufacturing something then shipping it.
I searched for someone to interview who is involved with drop shipping from a manufacturing standpoint. In return for providing me with answers to some of their business processes, I offered some free publicity. Some of the questions about the sophistication of the business processes I hoped to get answered:
Are any of your contracts executed electronically? In other words, does customer send you an electronic purchase order or is done verbally/FAX? If electronic, how is it done? EDI? Other? Is either a shipping advice or payment done electronically? How do you communicate with your factories? Voice, FAX, email, or some type of electronic file sharing over Internet? Now, how do you ship? I need some type of introduction to your vendor, customs broker, shipping company. What type of electronic interface do you have with them?
Instead of getting a manufacturer, I got a third-party logistics provider. Sort of like going fishing for trout and catching a bass instead. So his responses to my questions were:
1. With the advancement of technology, many customers, clients, now prefer giving instructions electronically via email about forthcoming shipments, clearing instructions etc. A lot more still use the telephone to get their instructions across.
2. Payments are mainly done electronically through the banking system. Only small amounts are paid using cash. Electronic payments are safer and secure and there is always a record of any such transactions, in the event of a dispute arising.
3. Our communication with factories, clients, is limited to the Purchasing Departments of these clients as they give instructions on forthcoming shipments etc.
4. We do our own customs clearing as we are a registered and licensed customs broker in Zimbabwe. We have established linkages with fellow shipping companies in the region as well as in Europe. Should we have shipments to be picked up from such areas, we engage these to undertake the job on our behalf.
5. Our interface with our partners is mainly electronically through email and skype. Occasionally though, we make use of the telephone.
Anybody remember when Paul Harvey used to say: "And now the rest of the story"?
Well, my new friend Takemore was easy to talk to and helped me understand things are a lot different in Central Africa than North America. Right now, exports are way down, for example.
A company in the U.S. called me and needed someone to "land" a shipload of Brazilian sugar in Ghana. I turned them over to Takemore. He passed that test with flying colors. Then they wanted to begin selling frozen vegetable "puffs" to Ghana. Takemore is doing very well with the ocean shipping, but needs a little help moving the product from Chicago to an East Coast seaport. Lots of new things to learn (credit apps, intermodal), but he is a fast learner and a hard worker whose motto is "We are no stranger to hard work". EDI 101 is starting now for Takemore.
Now the publicity I promised to Takemore:
Takemore Muketiwa is from Constan Freight Services in Harare, Zimbabwe
Tel: +263 8644052368/9
Fax:+263 4 704208
His motto: "We are no stranger to hard work."