Dropshipping is a true miracle e-commerce strategy, highly prized by entrepreneurs who want to quickly make their online business profitable.
But is it really without disadvantages? What do you need to know before you start doing dropshipping? What are the risks for you, the supplier and the buyer?
Let's see that.
To explain it simply, dropshipping is a strategy of reselling products without having stocks. This is a direct delivery from the supplier to the customer, where the seller only acts as an intermediary.
As a seller, it's a method that allows you to offload inventory management and logistics to the supplier, which means less cost for you, but also a high level of trust in the partner.
You can therefore focus entirely on managing your online store, promoting your products and looking for new opportunities.
It is up to you to choose the products you want to sell and present on your platform. Once you have defined the goods to be offered, you will have to choose the best suppliers of these items, and negotiate with them to offer dropshipping. To help you find products, some great tools exists, like Sell The Trend.
This is a very important step, because you will depend greatly on their reliability, which is why you must absolutely find trusted partners.
It is advisable to meet directly with the supplier if possible, test the products upstream and draw up a clear contract before any formalization.
Once you have listed your products and chosen your suppliers, you must integrate the products on your platform and create descriptions, sometimes taking pictures if those of the supplier are not enough.
Your customers will order and pay for products sold in dropshipping on your site, without necessarily knowing that you practice this method of trading.
This means that you will have avoided the logistical part and will make a profit from the sale of your suppliers' products.
However, your visitors will only come to your store through a good natural search engine optimization (SEO) strategy or through advertising (SEA). You can also use social networks (SMO).
It is up to you to manage this part to honour your contract with the supplier, especially if you have defined quotas.
This is a very effective technique for starting an online business. Unlike traditional commerce, you have the ability to create an e-commerce site without having to buy stock, and depending on the conditions imposed by your business partners, you will have the opportunity to access a wide range of products for free.
There are also providers who will offer you a monthly or annual subscription, often affordable.
You have more time to focus on sales. As you have no inventory to make, no stock to manage, no packages to prepare or delivery to make, you are relieved of these tasks which require manpower and a certain budget.
You can focus on your company's communication and increase the number of sales.
Finally, it is an excellent solution to test new products that your targets do not yet know. And it's still very advantageous, because you won't have unsold items on your hands if it doesn't work.
This strategy will then allow you to define whether these items meet the needs of your potential customers, thus avoiding risks.
By Thomas Guillaumont
Thomas is an Ecom Entrepreneur as well as the owner of multiple successful blogs on the subject.
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