What is Drop Shipping?
Drop shipping is a business model where a Retailer never fulfills orders manually and instead tasks a Supplier to ship products on their behalf. Essentially the Retailer acts as a “middle man,” often listing items on their website at a profitable margin, while purchasing said items from a Supplier at a cheaper rate. What typically happens is a Dropshipper will build an ecommerce site and list all the products which they have access to. Then when they receive a purchase, they would turn around and buy the product, with their own money, and list their customers credentials as a shipping address. Then when the customer receives their order, they would be reimbursed by the Payment Gateway they’ve installed on their website.
In other words, it is a newer form of albatross marketing, where you as a Dropshipper will take orders from online customers, buy goods from a Supplier, then have them delivered directly to the Customer without physically touching or managing stock. All requests are satisfied and transported directly from a wholesaler, such as CJ Drop shipping. This enables you the Dropshipper to focus more on building your brand, advertising and driving sales.
Thus, drop shipping provides you a way to easily start a business at a relatively low cost. Giving you the ability to scale a company from the ground up with little to no risk. It is entirely possible to build an empire with just one winning product. You do not have to pull a loan and go into debt buying inventory, only to deal with massive over head because the units didn’t sell. You don’t have to deal with the cost of renting, management and maintaining a warehouses.
In conclusion, Dropshipping is the perfect means for you to start a business on a low budget. Numerous companies started their web-based business with Dropshipping, Amazon, Zappos and Wayfair just to name a few. The ecommerce industry is steadily growing simply because it’s profitable. The only question you should be asking yourself is “how soon can you feasibly start your own business?”