Dutch dropshippers often break rules

The majority of Dutch online stores that sell products through dropshipping do not comply with legal regulations for online selling. Their websites lack contact details or information about returning orders, for example.

Researchers from the Dutch Consumer’s Association investigated 100 online stores that sell products by dropshipping. This entails selling products without buying any inventory beforehand. When a customer orders a product, the order is sent to the manufacturer, who then sends the product directly to the consumer.

For a lot of entrepreneurs, dropshipping is a great way to test the waters of ecommerce. They can try out which products sell best, without the costs of buying and storing an inventory. However, there are a lot of examples of online sellers who treat dropshipping as an easy way to make money online, without meeting laws and regulations.

No contact details or return information

This is also apparent in this latest research. At least 66 percent of the reviewed online stores do not list a phone number on their website, even though they are obligated to do so. They also often do not list a return address (65 percent) or a (registered) Chamber of Commerce number (66 percent).

82% of dropshippers do not mention the costs of returning a product on their website

Additionally, 82 percent of the websites do not mention the costs of returning a product. As is the case in all of Europe, online stores are obligated to mention this. Most dropshippers in this research sample only mentioned that the consumer will be charged for return costs.

Some online stores even said that they do not accept returns, for reasons that are not legally sound. For example, when a product was on sale. This is against regulations, as these products should be allowed to be returned. To make matters worse, many dropshipping online stores have their whole product range listed as on sale by default.

88% regret ordering at a dropshipping online store

More than 2,500 panelists were surveyed about their experiences with dropshipping. At least 88 percent of the consumers that have ordered a product through a dropshipping online store, said they regretted it. Long delivery times were the main reason for their regret (81 percent).

73% of consumers regretted their order because they had to send products abroad to return them

Having to send products abroad when trying to return them was also a common complaint (73 percent). The high costs of returning were also mentioned often (64 percent). Customers also complained about disappoint quality (59 percent) and poorly accessible customer service (58 percent). Additionally, online stores regularly did not (completely) pay customers back for their returned goods (45 percent) or transferred that money back too late (32 percent).

Dropshipping business hard to recognize

“The problems with dropshipping are legion and persistent. Most dropshippers do not follow the rules”, said Sandra Molenaar director of the Consumer’s Association. “They do not seem to realize that doing business also involves obligations. And the fact that consumers hardly ever recognize online stores as dropshippers only compounds that problem. Consumers really need to be better protected and informed. That is why we shared our findings with the Consumer & Market Authority”.