Welcome to our blog series on Shipping Methods Explained. In this series, we’ll go through fulfillment processes – i.e., how businesses get products to their consumers after they’ve placed online orders.
In theory, it sounds simple. You may go on your tiny bike and hand-deliver your goods, achieving your goal. When you consider the intricacy of managing hundreds to thousands of orders every day, as well as the increasing shipping costs that could put you out of business.
Managing inventory, navigating each carrier’s unique requirements, and calculating the lowest possible cost from thousands of shipping alternatives… It’s a challenging job. That’s why more and more businesses are outsourcing their fulfillment operations.
Are you ready to outsource your fulfillment? Let’s look at your alternatives to help you decide the best way for your company. We’ll talk about Dropshipping in this article. What is dropshipping, and what are the benefits/disadvantages? When should I use it? Let’s get started.
What is Dropshipping?
This refers to a product that is sent straight from the manufacturer, supplier, or wholesaler to the customer without passing through the store that sold it.
- A customer visits your company’s website and purchases an item.
- Your website automatically notifies the dropshipping supplier
- The dropshipping supplier receives the order info and customer’s shipping information
- Your dropshipping supplier fulfills the order directly
How to Start a Dropshipping Business
Dropshipping businesses are quite popular these days, owing to the promise of a passive revenue and the ease with which they may be set up. All you have to do is follow three simple procedures.
Step 1: Choose a Product/Niche
The first step in establishing a dropshipping firm is to select the items you will offer.
This is the Make Money Fastest, Most Simple Way to Generate a Real Online Profits in 2019.
Step 2: Find a Dropshipping Supplier
Find a dropshipping provider once you’ve chosen your product. (However, be sure to stay up to date on news regarding Chinese dropshipping providers) You may look for a supplier database like Dropship Direct, Alibaba, or AliExpress.
Alternatively, you may use an integrated provider directory. This means that as soon as you open your online store, such as in Shopify (see Step 3), the dropshipper will be linked to it immediately.
The easiest integration, according to Shopify, is the Oberlo marketplace. From here, pick from millions of goods and immediately upload them to your store.
Step 3: Build Your Online Store
Once you’ve identified your product and supplier, get creative with your online business! This will be the epic arrival of your brand.
Websites like Shopify, Wix, and 3DCart offer you the option of starting your online store from scratch or utilizing pre-made templates. When deciding between your alternatives, be sure they all include a simple connect feature with your dropshipping vendor.
Consider who you want your target audience to be when building your store, and make sure your website meets their needs. In addition to appearance, this includes website functionality. You may encourage repeat buyers by providing a simple and easy shopping experience.
Dropshipping Pros and Cons
Is dropshipping the right fit for your company? Alternatively, would a third-party logistics provider or another fulfillment approach be beneficial to you? Let’s take a look at the advantages and drawbacks of dropshipping to help you decide.
Dropshipping Shipping Advantages
Dropshipping, in particular, is a great way to generate a passive income. It’s simple to get started; you don’t need much money. You may quickly test your concepts with minimal risk to yourself. Dropshipping has the following three key benefits:
Less Capital is Required
Dropshipping eliminates the expense of investing in inventory, warehouse costs, shipping expenses, and other items necessary for a conventional business. Dropshipping allows anyone with a laptop and a desire to start an online firm to do so.
Able to Offer Wider Range of Products
Dropshipping enables you to operate with much less inventory risk, since you don’t have to buy it until after the sale. As a result, this allows you to sell a wide range of items on your site.
Simple to Start
Starting an online business has never been easier, thanks to companies like Shopify that make the whole procedure a drag-and-drop activity.
Dropshipping Shipping Disadvantages
Many individuals have created an internet dropshipping firm for a variety of reasons, and many others utilize dropshipping to expand their product lines. Dropshipping, on the other hand, has drawbacks:
Low Profit Margin
Because the barriers to entry into the dropshipping business are low, competition is fierce. Because there are many merchants on the market, costs decline as they compete with one another. Sure, you may set yourself apart by brand, customer service, and so on.
Little to No Customization
Because you are at the mercy of your supplier, they seldom make any changes to the look, design, or unboxing experience of your goods. If you want to change the look of your product in any way, for example, or package it differently or in a bundle, this will almost certainly not be permitted.
Alibaba dropshipping suppliers will generally adapt and customise, but they may also completely control the product and then sell your customized goods to the next vendor.
Little to No Control
You trust your supplier with the full fulfillment process, and you accept the level of service they provide. You won’t be able to blame your provider if something goes wrong or there are mistakes, and it will be your brand that takes the hit. Maybe not in terms of money, but certainly in terms of reputation.
So, is dropshipping the best way for your company to generate income? If you’re not sure, stay tuned for our next post, when we’ll discuss third-party logistics (3PL) and fulfillment providers like Launch Fulfillment.
Learn more about Launch Fulfillment’s industry-leading warehouse management software.