Dropshipping is a business model where you can make money by selling products without ever owning inventory or having to ship any of the items yourself.
This article aims to explore how dropshipping works, the benefits of this approach to selling, and some of the disadvantages that come with it.
What is Dropshipping
Dropshipping is a retail fulfillment method where e-commerce retailers don’t keep products in stock. Instead, when a customer places an order, the dropshipper supplies the product from a wholesaler and then delivers it to the customer’s doorstep.
There are many advantages of dropshipping such as easy to set up and cheaper than traditional ways of retail. Dropshipping is not only beneficial for online retailers but also for people who run an offline business and don’t want to invest in expensive inventory.
It’s not necessary for dropshippers to have any experience in marketing or sales because they will be relying on the supplier to do all the marketing and sales work for them. This means that they can start making profit even if they don’t have any knowledge about how to market their products
It works as follows: A retailer may sign up with a few wholesale suppliers and place orders as they come in to gain access to these items at wholesale prices. When the customer places an order on the retailer’s website, the retailer reaches out to the supplier for that item, who then ships it to the customer’s address directly.
However, dropshipping has tell tale long delivery times and because the dropshipper has no control at all over the quality of the product complaints can come in from customers demanding refunds. It’s not all rosy.
The global fulfillment market is forecasted to grow from $4.13 billion in 2017 to $6.71 billion by 2027.
Fulfilment services provide a physical component to e-commerce processes, which includes the storage and delivery of products, fulfilment of customer orders, warehouse operations, inventory management and logistics management.
Businesses can benefit from fulfillment services in various ways:
- it can help them reduce the amount of time and money spent on inventory management and logistics management because it will automatically track inventory levels and monitor customer orders;
- it can save time because the process would be automated;
- it provides a competitive edge because businesses will be able to offer faster shipping times than their competitors;
- organizations that charge by weight would benefit from these services as they save time calculating weight for each order.
Popular fulfilment services include:
is an email marketing service that allows users to send their own mass emails, manage subscribers, create professional designs with templates, and track campaign success.
is an online marketplace for design projects where designers can submit proposals for design work and bids to be considered by buyers.
is a service that enables freelancers to make proposals for projects in a single click without having to wait on client replies or be available for phone calls.
Fulfillment services are the backbone of the ecommerce industry. For instance, if you’re an online retailer, your fulfillment company is responsible for shipping your products to customers across the country.
These companies offer a wide range of services, including warehousing and distribution, packaging and labelling, returns management and customer service. They also handle more complicated tasks like drop shipping or product assembly.
The term “fulfilment service” can mean many things to many different people. However, in general, fulfilment services are companies that provide third-party logistic and distribution services for their customers on behalf of other companies.
What does this mean? This means that fulfillment services distribute goods to the customers on behalf of the company’s customer. They also have the capability to store goods in warehouses and ship them when needed.
Some common fulfillment services include warehouse space rentals, order picking, order management, order processing, inventory management, inventory storage and packaging.
Companies use these fulfilment services for many reasons including being able to offer free shipping without having warehouses in every state or country.
Is it a get rich quick scheme?
The answer is no.
The reason is simple, that for every 100 entrepreneurs who start any business very few will succeed. So why should dropshipping be any different. It is most certainly not a get rich quick scheme, although undeniably you can get very rich, but you have to work at it. It’s a skill set you have to learn. It’s something you have to persevere with. It’s like pushing a car, at first it’s mighty difficult but as inertia takes over you can keep it going with less effort, but the key take away here is that it still takes effort otherwise the car will stop. This is where many dropshippers will fail. They will expect to see big results very quickly and when that doesn’t happen they will get distracted and give up.
Should that put you off? Of course not! It’s like divorce, just because your best friend’s marriage ended in divorce doesn’t mean your’s will, so likewise you could be the success.