Dropshipping is a retail fulfilment method. To make it simpler, in this method a store does not keep a product. Rather, it buys it from a third party and ships it directly to the customer.
What is the difference between dropshipperand a retailer?
The purchase is made by thedropshipperaccording to the need of the third party. On the other hand, a retailer has collection of goods based on the requirement of a wider market. How does dropshipping work?
Let us assume that a person wants to sell products online. He can do this from his home or any other place without aninventory. Such people neither make large investment nor hold warehouses to store the products. This is where a sourcing agent of dropshipping comes in. They give access to products that the person desires to sell. The access includes downloading images, product descriptions, etc. These images are used by the person to sell a product. When a customer orders the product with the person, the dropshipping agent ships it to the customer.
Pros of dropshipping
1. It is highly advantageous to wholesalers who work from home. This is because they do not own an inventory. 2. The investment required to start dropshipping is very less. 3. The product offerings can be changed and added easily.
Cons of dropshipping
1. A lot of research work is required to choose the right product 2. Not all the wholesale men offer dropshipping 3. It is hard to find a good certified agent. As the complete business is happening over internet, one can never find differences between a scammer and an original agent. With increase in e – commerce business, dropshipping is growing exponentially. Recently, dropshipping agents in China have increased 10 times as compared to the previous years. This is mainly because of the growth of online shopping.