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Shipping Tips & Solutions

What is Blind Shipping? Is It Right for Your Business?

Blind shipping is a common shipping option for eCommerce merchants. Learn how it works and when to use it in our guide below.
What is Blind Shipping? Is It Right for Your Business?
Jules

By Jules

 

October 6, 2020

Modern eCommerce merchants have several fulfillment and shipping options they can rely on for their shipping strategy. Understanding the various intricacies of each, and when to use them, is essential to achieving a satisfactory customer experience.

Blind shipping is a common shipping option and practice that you should understand and integrate into your shipping repertoire, as it can help boost your bottom line. The guide below outlines some important things to know about blind shipping, and when it might come in handy for your store.  

What is blind shipping

What is Blind Shipping?

Blind shipping is a delivery option wherein the name and address of either the shipper, buyer or both are hidden on shipping labels.

This practice is commonly used by third-party sellers who act as a sort of middleman between wholesale suppliers and consumers. One example of this is dropshipping… but we’ll circle back on that in a bit.

For now, you should know that blind shipping can be disadvantageous to eCommerce businesses, as the practice allows them to sell wholesale goods to consignees (buyers) at inflated rates. But if the middle man were to keep the wholesalers address hidden, the consignee would be none the wiser. Blind shipping prevents buyers from tracking down the supplier, making contact  and purchasing the wholesale goods themself. That aside, it gives  eCommerce stores a leg up over competitors, making reliable suppliers effectively untraceable.

How Does It Work in eCommerce?

With blind shipping, customers receive their orders printed only with the eCommerce store’s information — nothing about the supplier is mentioned. This option is best for eCommerce stores acting as middlemen who want to hide supplier information. Merchandisers can also request for blind shipping for many reasons. The case scenario below outlines a perfect example for better understanding:

Manufacturer X: A product manufacturer based in China. They manufacture the product ordered by the online customer.

Distributor Y: A distributor based in any part of the world. They are the online business placing the order from the manufacturer to be sold to customers online.

Retailer Z: A retailer based anywhere. They purchase products from the distributor.

Based on the above information, Distributor Y is the intermediary who makes profits from the price difference between the Manufacturer X and Retailer Z. If Retailer Z discovers that the products are from Manufacturer X and available at a dramatically lower price, it’s plausible to believe that they may stop placing orders from Distributor Y and go directly to Manufacturer X. To remain in business, Distributor Y should consider leveraging blind shipping. Through this, Retailer Z will remain in the dark regarding the source of the products.

Related: How to Reduce Your Shipping Costs with Order Consolidation

4 Benefits of Blind Shipping

Blind shipping is often executed at distributors’ request. eCommerce stores can benefit from this strategy in the following ways:

  • Protective Advantage

Online stores, especially competing businesses, are often searching for where other distributors source their products to get a good deal. As such, businesses should carefully guard their secret sources. Dropshipping is one way to achieve such a protective advantage.

  • Client Retention

The anonymity afforded by blind shipping prevents your online customers from placing orders directly from the manufacturer, instead returning to your business.

  • Brand Consistency

Taking advantage of blind shipping makes it possible to develop a unified customer experience in all your products. Since all your orders will be delivered to customers only with your contact information as documentation, shoppers can easily identify products you sell.

  • Better Profit Margin

Once you have positioned yourself as an established brand rather than one in a sea of thousands of eCommerce stores, you can adjust product prices based on your markup and let the cash flow.

Blind Shipping vs. Dropshipping

Typical dropshipping has a clear out working system, wherein the eCommerce store functions as a marketplace for manufacturer’s goods. Because the costs associated with branding and customized items adds up quickly, dropshippers often opt out of blindshipping.

While it saves costs, this makes them vulnerable to losing clientele. Without a blinded return address, buyers can contact the supplier for better prices than the dropshipper offers. Or, and perhaps worse, revealing sources means that competitors can also place orders to find your manufacturer.

As we previously mentioned, one main disadvantage of blind shipping is high shipping costs. There is also an additional link to the delivery chain, which increases the risks of shipping errors and resulting losses. Since blind shipping requires working with additional freight-forwarding company, finding a trustworthy and reliable company to safely deliver your products can be challenging.

Both blind shipping and dropshipping require a significant investment in customer service and marketing to be successful. However, dropshipping has a key advantage over blind shipping, as there are no minimum volume requirements. You can place orders to manufacturers even when the client needs just one part of the product. Similarly, blind shipping becomes unnecessarily expensive when delivering small quantities of items. This is because of the minimum cost of handling the blind bill of lading.

What About Double-Blind Shipments?

Double-blind shipping is an advanced version of blind shipping — think of it like the ultra-secure version. Unlike blind shipping, where online stores include their addresses or contact information in the package, no pickup or delivery address labels are included when double-blind shipping. This is done so the manufacturing company can’t determine the consignee’s address and the customer cannot know the shipping company’s address.

Double-blind shipping is a good option if a retailer doesn’t want the manufacturing company to know a customer’s details and the customer from knowing the manufacturers’ details. The third-party shipping freight company will conceal details for both parties.

How to Blind Ship

To complete blind shipping, you should partner with a freight forwarding company. Partnering with a reliable company will significantly impact the speed and quality of your deliveries for the better. Since blind shipping has the goal of concealing information from the consignee and shipper, it has three different bills of lading. They include:

  • A bill of lading from the shipping company when the shipment is being picked
  • A bill of lading issued to consignees during delivery
  • A proper bill of lading filled with shipping and delivery details given to the courier

That aside, multiple couriers have different ways of handling blind shipping. Unfortunately, most many international couriers do not offer blind shipping — except for UPS, USPS, and FedEx. Some couriers, such as UPS, have additional requirements that must be met for blind shipping. Since this process requires managing the three bills of lading, you should work closely with a third-party logistics company to keep things in order. To blind ship, contact your courier of choice either through phone or sign in from the courier’s website.

Should You Consider Blind Shipping for Your Online Business

With the rise of international trade, blind shipping is an increasingly popular practice to help businesses maintain a competitive edge. Distributors and retailers are leveraging this option to fulfill orders, keeping their customers in the dark.

While this process is complicated compared to standard freight shipping, it helps distributors maintain anonymity and gives eCommerce businesses the ability to keep information about their manufacturers and importers confidential. Understanding the specifics of blind shipping can help eliminate potential blunders.

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