Drop shipping is a fulfilment method allowing you to buy products individually from a wholesaler who will ship them directly to your customer. You will not need a warehouse to store all your stock, as you will never see or handle the product delivered to the customer.
The biggest difference between drop shopping and standard retail is that the selling merchant will not stock or own inventory. Instead of purchasing a large quantity of inventory, you simply partner with a drop shipping supplier and list their merchandise for sale. Once you receive an order, you will forward it through to the supplier for fulfilment. The supplier will ship the product directly from their warehouse to your customer, and only charge you for the wholesale price of the shipped item.
Drop shipping is very appealing for new, small and home-based online businesses because you can be a retailer who can sell a variety of products without ever having to stock any inventory whatsoever.
How does Drop Shipping work?
Step 1: A visitor arrives at your online store and makes a purchase.
Step 2: You receive the order and can either manually or automatically forward it through to your drop shipping partner.
Step 3: Your drop shipper packages the order and ships it directly to your customer on your behalf.
The image below provides an overview of what a drop shipping transaction looks like:
How to get started in Drop Shipping?
Marketing Global Stores are the number one agency in drop shipping services, with multiple suppliers and products in their catalog. They will be able to connect you with their suppliers as per your business requirements and assist you with starting a drop shipping business and provide you with ongoing support. Find out more here.
What are the benefits of Drop Shipping?
Less capital is required – less upfront costs
Easy to get started
Flexible location – can work from home.
Wide selection of products
Easy to scale