Drop shipping is the term used when a distributor or your supplier takes care of the shipping to your customers for you. So rather than ordering and storing stock in bulk all the stock remains with the supplier until you place an order for the item and that item is shipped directly to your customer on your behalf and with your company details on the box.
Drop shipping is quite popular with many online sellers as it takes lots of work away from you so you can concentrate on selling instead of spending time on packaging and shipping. But there are some downsides to drop shipping; these downsides mainly affect new sellers.
Here I am going to list pros and cons about drop shipping so if you considering selling online for profit you can make the correct decision if drop shipping is right for you.
Advantages
1 You do not have extra shipping costs for the stock delivered from supplier
With drop shipping you don’t have to pay shipping 중국배대지 charges for the stock to be delivered from supplier to you. Which means you can offer better deals to your customers or to have better margins, which in turn means better profits for you.
2 No Storage required
Since the product is directly delivered from your supplier to your customers you do not have a need for storage this means more savings and better profits for you in a long run.
3 No packaging needed
This will save you a bit of money as you do not have to spend money on your own packaging and labels.
4 You have more time to concentrate on your business
You do not have to deal with packaging and shipping it will save you lots of time, which you can spend on improving your business and generating more sales meaning you will be more successful and have higher profits.
Disadvantages
1. Sometimes it can be costly
In some cases you have to pay suppliers for the cost of labor and materials which is involved in drop shipping. Normally if you do have to pay the cost is somewhere between $2 and $5 for each item. In some cases depending on your margins and quantity some sellers especially new once can find that these additional costs may not be sustainable because of the reduced margins. This is one of the main reasons why drop shipping may not be a good option for some new sellers.