Dropshipping is the method of retail fulfillment wherein the store doesn’t stock the products that it wants to sell. Instead of storing the product, the store sells the product by utilizing the dropshipping method – by purchasing the item from third party and then shipping it directly to customer. This means that the seller doesn’t need to handle or deal with the product directly. The fundamental difference between standard retail model and dropshipping is that the seller doesn’t own or stock inventory since the selling merchant buys the inventory as and when needed from the third party – which is usually the manufacturer or the wholesaler – for fulfilling the orders.
The advantages of the dropshipping model
The dropshipping is an amazing entrepreneur model for the upcoming and aspiring business people since it is highly accessible. The dropshipping enables people to try out the different business ideas and with very limited downside. This helps in gaining priceless experience on business choices and in-demand products. Some of the advantages associated with dropshipping model are as follows.
Less investment: With the dropshipping model it is possible to start the ecommerce store without requiring to invest a lot of capital into its inventory. With this model you are not required to purchase the product unless you have made the sale and already been paid by customer. Without requiring the upfront investment on inventory it is possible to source products and begin a successful business without a lot of investment. No upfront payment also means there is considerably less risk involved in the running of your business.
Convenient to get started: Starting the ecommerce business is more convenient when you don’t need to handle the physical products. Using the dropshipping method, you don’t have to worry about paying or managing a warehouse, packing or shipping the orders, tracking the inventory for accounting purposes, handling inbound shipments and returns, managing the stock and ordering products constantly.
Low overhead: As you don’t have to deal with managing a warehouse or purchasing an inventory, the overhead expenses are significantly lower. Many of the dropshipping businesses tend to operate as home-run businesses requiring nothing but a computer system and some of the recurring costs for operations. As your business grows, the expenses might increase however it will still be lower in comparison to the conventional brick-and-mortar businesses.
Easy scaling: In the traditional business if you get three times the orders then you would need to work that much more. However by leveraging the dropshipping suppliers, the majority of work for processing extra orders is done by suppliers thus enabling you to expand lesser hassles and far less of the incremental work.
If you need a dropshipping agent for your requirements then ‘Nei Shei’ is one of the premium agency based in China. The agency or the company provides you with an efficient shopify app, brand building and faster logistics optimization. You can expect the most efficient and professional dropshipping service from the company and impeccable customer support for all your queries and issues.