Dropshipping is a rather contentious topic amongst the legions of online sellers. There are those who love it and swear it’s the panacea for anyone interested in starting their own ecommerce business and then there are others who don’t believe in it as a distribution channel. Our opinion on the matter is slightly more moderate: dropshipping is a great way for small and medium sized companies to source products to sell online for a profit, however you can’t just slap a bunch of products on a website and expect the dough to start rolling in. Like any successful business, an online store requires a sound business plan, a well thought out marketing strategy, excellent customer service and some good old-fashioned hard work (and this holds true regardless of whether or not you support dropshipping).
So is using a dropshipper the right choice for you? Well, to ensure that everyone is on the same page, let’s define dropshipping first. In a nutshell, dropshipping is a supply chain management technique where when a customer purchases a product from an online store, the retailer passes the order information to a wholesale supplier and then the supplier processes and ships the order to the end-customer - hence the term dropship supplier.
For many new businesses, partnering with a reputable dropship supplier offers a way to sell a wide variety of products without the cost of carrying that inventory. Also because the supplier isn’t paid until after a product sells (and you’ve been paid), it’s a low risk way to test new products or to just start an online store.
Working with dropshippers offers other advantages to the online store owner. Since you don’t have to place an order with a supplier, wait for the inventory to arrive at your store and then start selling it, you can get the jump on hot products and new trends much quicker than a retailer who does not employ a dropshipper. In fact all you have to do is stick the product on your website, promote it, and wait for the orders to start coming in.
Most importantly, using a dropship supplier allows you to focus on your core competencies. More likely than not you got into online retailing because you enjoy the marketing, the selling, and the customer relations side of owning a webstore. That’s also what you’re good at. Using a dropshipper means you get to focus the majority of your efforts on this piece of the business and let the dropshipper focus on order fulfillment. Ultimately this leaves you more time to make more sales and more money.
These are just a few reasons why you’d want to consider using a dropship supplier. The best advice we can offer is for you to do your research and locate a reputable dropshipper that supplies the products you want to sell. They’ll be able to answer your questions and you can decide whether or not this is a business strategy you wish to pursue.
For more dropship and eCommerce tips visit the Shopster blog
Shopster offers a suite of Dropship and eCommerce solutions for small to medium sized businesses. Thousands of online merchants from around the world rely on Shopster as it simplifies the complexities of online retail, allowing merchants to manage their store, transactions, and supply chain relationships in one easy to use place. Shopster is an official eBay Solutions Partner.
Guest Blogger: Suzanne Lucas – Communication Manager of Shopster eCommerce Inc.