Dropshipping is a type of retail fulfillment method, where instead of a store stocking products, it purchases the products from a third-party supplier. The products are then shipped directly to the consumer. This way, the seller doesn’t have to handle the product directly. Sound familiar? Maybe not, but 33 percent of online stores use dropshipping as a fulfillment model.
For the store, this is a mostly hands-off process. The merchant doesn’t have to order inventory or fulfill the orders in any way. Instead, the third-party supplier takes care of the product itself.
Dropshipping is great for entrepreneurs because it doesn’t demand as much as the traditional retail model. You don’t have to open a brick-and-mortar store, pay overhead, and stock products. Instead, you open an online storefront and buy wholesale from suppliers who already have products and warehouse space.
The merchant is mainly responsible for gaining customers and processing orders in dropshipping, meaning you’ll effectively be a middleman. Despite this, you’ll reap the lion’s share of the profit by marking up the items you sell. It’s a simple business model and one that can be very rewarding.
Millions of entrepreneurs flock to dropshipping because it requires less hassle and money to get started. That’s probably why you’re interested! And the best news of all? With dropshipping, you can build a business that’s sustainable in the long term right from your laptop.
Of course, there are many drawbacks and advantages, and it’s important that we look at them before you start your own dropshipping ecommerce business. Once you understand the pros and cons of dropshipping, however, learning how to do so effectively will be a breeze.