Blind Shipping vs Dropshipping What are the Differences?

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What is blind shipping?

Anyone working in the shipping, warehousing or e-commerce industries will need to be able to understand blind shipping. Blind shipping, like many other market practices that we have covered in our blog can be confusing.

Let’s take a look at blind shipping to see if it is right for you.

Blind shipping is the act of sending an order directly from a supplier, to a customer. The supplier’s identity is hidden from the customer.

Double-blind shipping refers to when the supplier and customer don’t know each other’s identities. In this instance, the shipper is the only one who knows the identity of the supplier and customer.

Why use blind shipping or double-blind shipping?

These two shipping methods exist because third-party sellers don’t want their customers to know from where they source their products. Double-blind is the same, except the third-party seller doesn’t want to know the customer’s name. Third-party sellers can use blind shipping to control who has access and how they market.

Although this may seem unfair to some, it makes the market more accessible for many customers. Customers don’t have the burden of dealing with large product manufacturers who might lose a few orders in spite of all their other work. Consumers will receive better customer service and faster shipping times if they purchase from a third-party seller.

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What types of businesses use blind shipping?

Blind shipping is not a good option for every business. Blind shipping is most common for retailers who sell products at a higher price. Blind shipping is used to secure future business and provide a positive customer experience.

Companies that sell products in the US, but source them from overseas, also find this common. A company selling office supplies may ship products directly from its wholesaler. They don’t want to tell you who the wholesaler is, so you can continue to purchase products from them. The office supply company will create a blind shipment to make it appear that the shipment is coming from them, but it’s actually coming from their wholesaler.

They’ll also set up double-blind shipping if they want to keep customer information secret from a wholesaler. They will be able to continue to facilitate the transaction and make money by slighty increasing the price.

Benefits of blind shipping

These are just a few benefits, but let’s get into the details about what blind shipping is.

Supply Chain Management

Supply chain management is the number one reason blind shipments are a good idea. It is important that your customer doesn’t see the address of the shipper as something other than your business address. The shipper also shouldn’t know where the product is being shipped to. This will ensure that your supply chain runs smoothly for many years. Double-blind shipping is the best way for you to manage your supply chain.

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Keep a competitive market advantage

If you are making a lot of money, or have many customers, you may notice other companies starting to take your business seriously. You need to protect your suppliers’ information to maintain your competitive edge over copycats and other companies looking to steal your business. Double-blind shipping will help you maintain the market advantage you have worked so hard to achieve.

A low overhead and hands-off approach

Drop shipping is very similar to blind shipping in that it requires minimal overhead and requires no hands-off. A blind shipper only needs to obtain the customer in order to be able to setup the shipment. Blind shipping is a common practice for many companies. They have little or no overhead and don’t even own any inventory. Other companies may have their own inventory or partner with distributors to provide greater control and reduce transit times. This can save you time, money, and headaches.

How to set up blind shipping

Here’s how to set up blind shipments if you feel that blind shipments might be right for you.

Freight broker contract

Contracting a freight broker is the first step to setting up blind shipping. You could choose from a variety of shipping companies or one that specializes in your area. You will need to establish a business relationship with a broker.

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Create two BOL’s (Bill of Lading).

A bill of lading describes the details of the shipment. The BOL will contain all the relevant shipping information. A second BOL will contain dummy information about the address it is going to or coming from, depending on who needs it. The BOL will be changed when the carrier collects or drops off the item. This process can be aided by most carriers.

Let the Shipper do the rest

Once those logistics are done, your shipper can take care of the rest. This is the beauty of blind shipping. Freight brokers do the majority of the work.

Blind Shipping vs. Dropshipping

Although dropshipping and blind shipping seem similar, there are many differences. Blind shipping is similar to dropshipping, in that the consumer doesn’t know where the order came from.

Dropshipping refers to when a product is shipped directly from the manufacturer to the customers through a transaction that was facilitated by third parties.

Blind shipping is a type of shipping where the BOL has been changed to protect the information of the receiving or shipping parties.

Dropshipping is a way to do business. Blind shipping is a one-off thing you do for certain orders. Dropshipping refers to the direct shipment of an item from a manufacturer directly to a customer. Blind shipping is when both the customer and shipper remain anonymous. Let’s examine why dropshipping is not always a profitable or reliable way to do business.

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Dropshipping is a unreliable business model

Dropshipping allows you to quickly make money without having to worry about inventory and other common order fulfillment items. Dropshipping is a way to make money quickly without worrying about inventory or other common order fulfillment items. Dropshipping is not always reliable.

  • It can be very difficult to control quality. Because you won’t actually see the product until it arrives at a customer, it can prove difficult to make sure that it is high-quality. You could have a unhappy customer if a customer orders a product twice from you and the product arrives looking different.
  • Dropshipping makes it difficult to make returns. If a customer wishes to return an item, they will have to pay a loss. Many manufacturers won’t accept returns, so you won’t get any money back.
  • Dropshipping is a low-margin industry due to high shipping and product costs.

Management of Blindshipments

It becomes increasingly difficult to ship blindly, making it more challenging to manage these shipments. You can help manage these shipments by using inventory management software. It allows you to store everything in one place. Topshelf from Scout is a great option that accomplishes this. Any incoming or outgoing inventory can be managed. It can connect to your warehouse to allow for quick pick, pack and ship. The system can also sync with your online listing or website so that you can track every order from order date through delivery date.