Drop shipping is a business model where a retailer does not have to carry the products they sell. The customers order the products and then you order directly from the supplier, who then ships them directly to your customer.
This means you do not need to carry the stock or even handle the product, but you receive the money from the customer.
An advantage of this is that you can list a large selection of products on your website, whilst maintaining smaller inventory management costs.
It means there is no need to stock products that are not selling well or are just trying out to see if they will be popular.
You will save on warehouse and delivery costs, as usually the supplier of the product will have a favourable rate of shipping due to larger volumes.
Many people who are starting their own online businesses turn to drop shipping as a way to get started without having to invest in inventory. However, there are a few drawbacks to using this business model that you should be aware of before you decide if it is right for you.
The first downside is that you have little control over the quality of the products that you are selling, or the speed in which they are shipped. Because you are not dealing directly with the manufacturer, it can be difficult to ensure that the products meet your standards.
Another issue is that you may not be able to find reliable suppliers who can consistently deliver high-quality products on time. This can cause problems with your customer satisfaction levels and lead to lost sales.
Drop shipping is quick to get started with as it is incredibly easy to launch a new e-commerce store these days. Then you just need to find a supplier or two, and start selling. But there’s a lot more to running a successful drop shipping business than just finding products and setting up shop. You need to be able to find profitable products, market your store, handle customer service, and manage your suppliers.
In summary, drop shipping allows retailers to focus on building their ecommerce businesses rather than stocking and managing inventory. Most of the work involved in running a drop shipping business is customer service and marketing your website.
