Drop shipping is a trend that is not going to go away. Some people dismiss it or other tout it. Here are some of the pros and cons so that you can make up your own mind.
Drop ship basics
Drop shipping is offered by some wholesalers so that you can offer items for sale on your website without carrying an inventory. The drop shipper does all of the shipping and handling and you collect a profit for processing the actual order.
The Pros
-
Low overhead…you do not have to bear the costs of warehousing and inventory hassles. These costs can be quite high.
-
No inventory…you do not have to spend a lot of money to initial start your business. New products do not have to be bought. You can list a hundred things and see what sells, cheaply.
-
Time recovered…you don’t spend time finding things in the warehouse, organizing the warehouse, receiving product, etc.
-
Minimum orders…are rare. Usually you can buy just one item at a time.
-
Selection…because you don’t have to buy a minimum and there is no inventory, you can offer a wider selection of products.
The Cons
-
Smaller profit…you don’t take any risks so you make less money per sale. It’s only fair to the drop shipper.
-
Delivery issues…if the drop shipper messes up , the customer is going to call you. Be prepared and able to answer their questions before you return their call or email.
There are a few problems with drop shipping, but the pros outweigh the cons. This is a good method of starting an e-commerce business.
