Important Aspects about Drop Shipping Explained

Important Aspects about Drop Shipping Explained

may 25, 2017

Important Aspects about Drop Shipping

¿If you have access to the internet, you can choose to spend your time online exchanging selfies, tweets or whatever with your social media community, or you can choose to go the smart way. Smart people are reaping immense benefits by establishing online businesses, which have proven to be quite convenient, compared to traditional brick and mortar businesses. As a matter of fact, drop shipping is one of the smartest ways of running an online business.

What is Drop Shipping?

Basically, drop shipping is retail model, whereby an online seller doesn’t handle products, but a purchase the products from a third party and ships those products directly to the customers. In other words, the seller doesn’t stock or own an inventory.

What is Drop Shipping?

How does Drop Shipping Work?

Like outlined above, this retail model doesn’t require you to have an inventory or a storage space to store products. All you need to do is to wait for customers to order products that you have advertised on your website and once those products are ordered, you can then purchase inventory as needed from a manufacturer or wholesaler to fulfill those orders.

A good example of how drop shipping works is like what Intima USA proposes, whereby you just create an online catalogue and sell their products to potential clients. The online catalogue is made available to you free of charge once you sign up. There is a wide range of products on display and your work will be to familiarize your friends and your online community with the products and encourage them to buy. For those interested in decorating their homes, they can get to see the beautiful home décor collection at Catalogo Intima Hogar. As for those who constantly update their wardrobes, there is a huge collection of clothes for both sexes at Catalogo Stefano Di Roma In case any of your friends or potential customers makes an order, they will have the products shipped to where they are without you having any direct contact with the products.

How do you get to earn from this retail model? Based on the example above, Intima gives you up to 55% discount on your wholesale price, sometimes even more. Make your first sale and you are already a representative of the company. What’s more is that you don’t have to purchase any stock or inventory in advance and you have no obligation to meet sales quotas. See? You as the link between Intimausa and potential customers will get money into your pocket.

Benefits of Drop Shipping

Benefits of Drop Shipping

There are a number of benefits that are associated with this online business model. Firstly, less capital is required. This is because you don’t have to raise a significant amount of capital to buy stock, pay for a warehouse, pack and ship orders, track inventory, etc. The other advantage is that you can run your drop shipping business from just about anywhere as long as there is an Internet connection.

Another advantage is that you are at liberty to offer a wide array of products to your potential customers. Once suppliers or wholesalers stock those products, you can list them for sale on your site at no extra cost. All these benefits make this online business model a very attractive and lucrative model to both established and beginning online merchants.

Disadvantages of Drop Shipping

The major disadvantage of drop shipping is that you are likely to be blamed for something that was not your fault in the first place and you have to accept responsibility for the mistake anyway. Suppliers may make mistakes when fulfilling orders such as missing orders, low quality packaging, botched shipments, etc. this can harm your business damage.

Nevertheless, drop shipping is a business model like any other and it is bound to have some setbacks. Overall, it’s still a very lucrative business venture that you can engage in.

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