Drop shipping is a supply chain management technique in which the retailer does not keep inventory in stock, but instead transfers customer orders and shipment details to either the manufacturer or a wholesaler, who then ships the goods directly to the customer. As in retail businesses, the majority of retailers make their profit on the difference between the wholesale and retail price but some retailers earn an agreed percentage of the sales in commission, paid by the wholesaler to the retailer.
To start using this feature in DEAR you will need to do the following:
- Set up Inventory to be used for drop shipping by navigating to Inventory Tab > View All Products.
- Select the product you wish to use for drop shipping. In Edit Product screen select from the Drop Ship drop down menu whether product will be Always Drop Ship or Optionally Drop Ship. Please note that if Always Drop Ship option is selected you will not be able to change this status when generating sale orders. You will also be required to provide a supplier which will be used for drop shipping and tick the Drop Ship tick box.
4. Once you have Authorised the sale order, DEAR will automatically generate corresponding purchase order(s) for suppliers.
5. When Sale invoices are authorised, sale transactions are exported to accounting software, and payments are received from accounting software.
6. The Drop Ship Purchase Orders are different from usual purchase orders. Blind Receipt and Input method are disabled. No Received and Unstock tabs are available.
7. Once purchase orders are fulfilled COGS transactions will be created in accounting software.