Since 2002, Doba has hosted its own marketplace for drop shipping, catering to all aspects of selling products: manufacturing, distributing, and retailing. Its Web site and platform hosts about 1.5 million unique products from more than 250 suppliers, and thus has the potential to create thousands of buyer-seller relationships.

“We are exclusively focused on managing that supply, in helping retailers and suppliers simplify that process,” said Blaine Nielsen, CEO.

The convenience it provides for both retailers and suppliers has resulted in major growth. In fact, last year’s growth was a 400 percent increase from its 2007 profit, Nielsen said. The company also ranked high on Deloitte’s North American Technology Fast 500 and MountainWest Capital Utah’s lists.

Nielsen and the company attribute much of the past year’s success to its Product Sourcing application performance interface (API). Launched last February, the Product Sourcing API allows retailers to use the company’s supply chain programming within their own applications, for functions ranging between searching product catalogs and pulling shipping information.

Following its launch came ten new partners, though the Product Sourcing API adds to the overall cost and time-efficient services that Doba provides. For one, the company taps into the rising popularity of drop shipping, which Nielsen called “enticing in a recessionary time.”

Online retailers can test their target market and suppliers can market products supplementary to their tried-and-true, without much risk.

“There’s a lot less financial investment in there,” Nielsen said. “Even to the extreme that they don’t make any money out of it, at least they are getting over that hurdle.”

In addition, access to its marketplace saves both retailers and suppliers from most of the painstaking process that usually comes with finding potential customers. The company, after all, strives to combine “the supplier’s distributing ability and the retailer’s purchasing power at a single connection point,” its Web site states.

For 2009, Nielsen hopes that Doba continues to expand in all possible ways, by increasing their number of suppliers, products, and partners.

“We hope to turn the number of new partners into 20 or 30,” he said.

But is it a money saver as well? It is often said that time is money. But just what is the true value of drop shipping?

We will attempt to answer that question in this article from a scientific approach, using logic to come to a conclusion as to what the value of drop shipping is for you.

The value of time is different for everybody. For Bill Gates, an hour of his time is so valuable you probably wouldn’t ever be able to pay him enough for his time.

Sometimes at the company I work for, we bring on interns. Usually they work without pay. What does the intern consider to be the value of their time? They are giving of their time, and getting no money in return. They consider their pay not as a present monetary figure, but as experience gained, which will in turn makes them more valuable to other companies. Thus it could be said that an intern is considering the value of their time as something that will be paid off in the future.

If I were to invest in the stock market, I would probably spend a good amount of time researching various stocks before deciding on what to invest my money in. I would then wait for a (perhaps very long) period of time before cashing out my stocks.

In such a case, I’m investing my time in the hopes of getting a future payoff for it. If I consider my time to be worth $50/hour, then my goal would be to get a $50 future return for every hour I spend doing research.

When using drop shipping to run part or all of your retail business, you save time by having somebody else track inventory as well as pull and package orders. Additionally, you don’t spend any time running to the post office to have orders shipped.

As an online merchant, you’re well aware of how much time and money you spend preparing an item description and packaging and shipping products. By following the traditional auction model, you actually spend more in time and money to deliver less merchandise. With drop shipping, you can significantly increase productivity, slash costs, and boost your bottom line.

In this article, I demonstrate how you can incorporate drop shipping into your current online business to save 55 minutes on the following tasks:
*Prepare the item description
*Package and address the item
*Ship the item

You also save money:
*Your hourly rate for performing these tasks
*Packaging materials
*Shipping costs
*Mileage to the post office

Let’s do the math.

Saving 12 minutes preparing the item description

I’m a bit of a perfectionist, so I spend at least 30 minutes snapping and editing photos for a single item. (I almost always use multiple images in my item descriptions). Subtract 15 minutes for perfectionism, and let’s conservatively estimate that the average seller spends 15 minutes preparing and uploading pictures for an item description.

With drop shipping you can use the supplier’s images-typically a higher quality than the homespun variety, and they require no time investment on your part. You can trim at least 12 minutes off your time investment for taking pictures, editing images, and uploading them to eBay or a third-party image hosting service. As an added bonus, you get a higher quality image.

To save you even more time, quality dropshippers provide members with rights to "hot link" to the images hosted on our servers. I have personally trimmed my time investment on photos from 30 minutes to 30 seconds using hot links to supplier images!

Furthermore, in most cases the supplier provides an item description for you which again saves you more time. However, since many sellers like to add to or rewrite altogether the item description, we won’t include this time saver in our calculation.

Saving 3 minutes in packaging

Traditional packaging time varies. For a small item that fits in an envelope, you can address the envelope, slip the item into it, and seal it in less than a minute. Larger, bulkier, more fragile items can take even a seasoned packer 10 to 15 minutes to properly package and address. Let’s make a conservative estimate of 5 minutes to package and address an average item following the traditional model.

How much time can you save in packaging with drop shipping? Oh, wait a minute… you don’t have to worry about packaging! You simply place the order online, and the drop shipper packages the item for you. So, that’s 5 minutes minus about 2 minutes for placing the order online for a total savings of about 3 minutes.

Saving 40 minutes in shipping

A single visit to the United States Postal Service can easily eat up 40 minutes of your day. An average round trip takes 30 minutes or more, at least for me, and you may have to wait in line for 5 to 20 minutes, depending on how busy your local post office is and how few clerks are working the counters.

Your post office may have a self-serve counter where you can weigh your package, input the dimensions, and pay at a machine that calculates the postage for you, but that’s still a 5- to 10-minute job assuming you don’t have to wait in line to use the self-serve machine.

With drop shipping, you slash your shipping time from 40 to zero when you place your order. The supplier ships the package for you.

Admittedly, you can minimize the traditional shipping time expense by packaging and shipping multiple items on a single trip to the post office, but with some drop shippers, you simply input the addresses into your account, and you’re done.

Calculating your total savings in time and money

By incorporating drop shipping into your online business, you just saved 55 minutes and slashed your operating expenses. Let’s break it down to demonstrate precisely how much you stand to save in terms of money:

$2.00 in packaging materials, on average (envelopes, boxes, peanuts, bubble wrap, tape)
$0.80 in fuel (assuming 35 mpg, regular gas at about $2.80/gallon, a round trip of 10 miles, not including insurance and maintenance costs of your vehicle)
$7.38 in hourly pay (assuming 55 minutes saved at minimum wage of $8.05/hour)

Do the math, and you realize that drop shipping just saved you $10.18 processing a single item. And that’s what you save if you use very conservative estimates. Just think how much you stand to save if you typically earn $25/hour or $50/hour or $100/hour!

When using a trusted dropshipper, you can slash your costs both in time and money, freeing up resources to invest in market research, networking, managing and growing your business, or just kicking back to enjoy your additional free time.

But to me, drop shipping isn’t just about the time and money I save. The truth is I absolutely HATE packaging, addressing, and shipping. Drop shipping is more about preserving my sanity. Instead of having to focus on menial, unrewarding tasks that I find annoyingly boring, I can focus on the more stimulating and satisfying aspects of running and growing my online business. Drop shipping is the less stress, less hassle way of merchandising online.