7 Powerful Pros And Cons Of Working With American Dropship Suppliers

There may never have been a better time for such a wide array of American dropship suppliers to be available to retailers than today — and it’s not hard to see why. When Trent first started dropshipping over twenty years ago, it was a minor business opportunity for creating passive income online. Over the past decade, dropshipping’s popularity has exploded into one of the major players in the global ecommerce industry.

Along with this rapid growth comes real changes in how dropshippers conduct business. The whole process has become more sophisticated and streamlined, with multi-channel software now standard practice among serious dropshippers.

Instead of primarily working through middlemen like AliExpress, Spocket, or the now-defunct Oberlo, you can gain full control and significantly greater profits by getting approved directly with USA suppliers.

Perhaps you’re wondering how to find the best suppliers, or maybe you’re not even sure what a “real dropship supplier” is. Either way, this power list of 7 pros and cons will help you gain the clarity needed to cut out the middleman and work directly with US dropship suppliers.

1 — Pro: Greater Control Over USA Dropshipped Merchandise

One of the biggest drawbacks of working with an overseas supplier — or even a popular sourcing platform like AliExpress — is that you’re never quite certain where your merchandise is actually manufactured. What looks like a bargain discount on a name-brand cell phone is definitely a bargain, because it’s actually a cheap knockoff.

Many countries still have relatively unregulated laws around bootleg or counterfeit retail brands. That’s far less of a concern in the US. Beyond stronger control over merchandise quality, you’ll generally get better service working with suppliers directly.

2 — Con: Approval With American Dropship Suppliers Can Take Longer

One of the biggest benefits of working with middlemen and global dropship centers is that approval is virtually automatic. You sign up, and you’re approved. That’s how it worked with Oberlo (before its 2022 shutdown) and how it still works with Spocket today.

Because of how easy that approval process is, there will by default be a huge level of competition. Easy is not always your friend.

Those product aggregators and middlemen have done all the heavy lifting for you — and you pay for that convenience. They’ve already secured supplier approval on your behalf, and they’ve built the technology to stream product data from supplier to store. That’s not the case when you attempt to get approved with suppliers directly, even in the United States.

Even though global and American dropship suppliers typically don’t charge a fee to get approved, they’ll generally require you to have five things in place:

1. An EIN (Employer Identification Number), also called a FEIN (Federal Employer Identification Number)
2. A sales tax ID, also called a reseller tax ID, certificate, or number
3. A fully functional website you control and operate
4. Top-notch customer support
5. The ability to actually sell online — or at minimum, a clear marketing and sales plan to generate consistent sales for both you and the supplier

Without proper training, many newcomers to dropshipping find the supplier approval process can take months. This isn’t always a drawback. Multi-supplier portals like EcomHunt can help streamline the process, allowing you to add international and USA products to a Shopify or WordPress storefront in minutes for a relatively minimal monthly fee.

3 — Pro: Dropship Profits Are More Sustainable

When you deal directly with an American dropship supplier, you’re not working through a middleman — which means substantially greater profit. When you work through a middleman, you genuinely don’t always know who you’re dealing with: a standalone supplier, or simply another retail dropship source reselling someone else’s inventory.

Even if you find what looks like a better bargain through a middleman, the risk of shoddy merchandise, unclear return policies, and significantly higher shipping rates and times isn’t really a benefit — it can be a real long-term risk to both your business and your reputation. It’s best to use middleman supplier sources only where you genuinely have to.

Dropship profits tend to be more sustainable when working directly with global or US dropship suppliers, because you have far more control over the relationship. You’re not relying on a third party to get things done. You can negotiate better pricing directly with the supplier and know exactly how the supply and fulfillment process works.

4 — Con: More Technical to Stream Products Into Your Store

We covered some of this in a previous post on multi-channel software, and it still holds true. When you deal directly with individual American dropship suppliers, you’re likely going to manually add products from each supplier into your storefront. Many direct suppliers don’t have automated product feeds that connect to WordPress, Shopify, or any other store builder.

If you’re new to dropshipping, it’s going to be easier as a solopreneur to make money sooner by immediately starting to sell products within your first 4 weeks of launching your store. The sooner you can start selling, the sooner you start making money — from there you can build toward expanding your business with your customers. That’s genuinely the best order of operations.

How can you make money as a solo operator sooner if you’re bogged down with constant research and data entry for months? You can — but it’s very difficult for most beginners without a substantial marketing budget and a team behind them. It’s even harder if you’re working a full-time job and building your dropship business on the side. The solution to faster profits as a solopreneur is to simplify. You can be a complete newcomer to dropshipping and still do very well financially, as long as you stay focused on selling as soon as possible.

You don’t need thousands of products on your site to make money. Instead, our advice to newcomers is to focus on adding just 1 to 50 properly researched products — ones that are more unique, less saturated, and high in demand. Going this route helps you start making money much sooner. From there, you can scale, add a virtual assistant or team members, and increase ad spend as it makes sense.

5 — Pro: Products Are Drop Shipped Faster

Your customers aren’t purchasing from you only because of a great variety at reduced rates — they’re buying out of convenience. They could pay full price at a nearby outlet, but prefer to avoid the hassle of driving out of their way to buy and haul the product home. Buying online is simply easier than buying offline for most products.

Working with American dropship suppliers helps you ship products to customers much faster compared to overseas shipping. True, in some circumstances customers may wait 7 days or even 2 weeks if the product is embarrassing to buy in person, or so unique it can’t be found offline — and they’re willing to wait for it.

But if the product itself doesn’t compel that kind of patience, you can count on the customer wanting it to arrive ASAP, not 30 days from now. That’s the core issue retailers face when working with middlemen like AliExpress.

Faster shipping times stay more in your control when working directly with USA dropship suppliers. In most cases, you can speed things up by using your own carrier or working directly with your supplier rep to set up faster shipment options.

6 — Con: Limited Inventory Control

Inventory control is always a challenge in dropshipping, since as a dropship retailer you don’t stock any product yourself. Without automating inventory syncing, you’ll need to manage it manually by communicating with your supplier rep. Many American dropship suppliers will email you directly with inventory status updates, and you simply update your store accordingly.

It’s equally challenging tracking inventory with international suppliers as it is with American ones. This means inventory can become scarce, especially during high-selling periods, which can lead to customer complaints if you’re accepting orders while supplier inventory is depleted.

Remember though — one of the fundamental cornerstones of any ecommerce operation is world-class customer service. Communicate proactively with customers who’ve placed orders to see if they’re okay waiting until inventory is replenished. Many customers will be fine with that, especially if you offer a small perk for waiting — a slight discount, a gift, or a coupon for their next purchase.

Limited or depleted inventory isn’t a problem unique to American dropship suppliers — it can show up across all dropship supplier types. Inventory issues are generally resolved either by communicating directly with your supplier, or by using technology to auto-sync inventory data from your supplier’s system to your store.

You can also avoid the cost of building custom inventory syncing by piggybacking on the auto-sync technology already developed by dropship aggregators like Spocket — as long as your supplier is willing to work with that platform.

7 — Pro: You Can Reduce Your Dropship Competition

As mentioned above, working directly with American dropship suppliers is a challenge well worth taking on. It does take more work — and work scares away a lot of newcomer entrepreneurs. If it’s not easy, many of them simply won’t do it. That’s actually good news for you.

You can take on harder things and benefit from less competition, because the people unwilling to do hard work naturally weed themselves out of the competition pool. The extra effort required to get approved with US dropship suppliers is worth it — especially over the long term.

Summary

American dropship suppliers continue to be the gold standard supplier source for dropship retailers. Despite the additional work of researching these suppliers and getting approved with them, it’s genuinely worth it. You’ll see less competition, better profits, greater control, and less friction — building sustainable profits for your dropshipping business over time.

While many middleman dropship aggregator systems offer great technology for syncing inventory and products to your store, that same tech isn’t always necessary. Often, more is too much and too confusing for an online retailer just getting started.