When it comes to starting a dropshipping business, as with any type of new venture, there is a learning curve. And although the dropshipping business model is straightforward, to have a successful and profitable dropshipping store, you’ll first need to understand what dropshipping is and how it works.
So, if you’ve been contemplating dropshipping, look no further. By the end of this article, you will have all the information you need to determine if dropshipping is the right online business model for you.
What is dropshipping?
Before we dive deep, let’s go over the basics as the first step. What is dropshipping, and what makes it an appealing online business model?
Overall, the format sets it apart from other eCommerce business models. Here is how it works.
There are three parties involved in the dropshipping business model:
1. A supplier or manufacturer
2. You (the dropshipper)
3. customer
Therefore, this is how the dropshipping process works:
A customer purchases a product from your dropshipping store.
You place the order with your buyer’s information from your chosen supplier.
The supplier ships the product to your customer.
The price margin then becomes your profit.
Compared to the standard eCommerce method, dropshipping is much simpler and easier. While standard ecommerce requires you to invest in inventory, store your inventory, and deal with packing and shipping orders, dropshipping only requires you to create a website, add products, and market your store.
Therefore, all you need to start dropshipping is a computer, internet connection, and the motivation to learn. It’s no wonder it took the world by storm.
Plus, once you get the ball rolling and it’s time to scale and expand your business, you won’t need new offices, warehouses, or a massive team of employees.
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