Drop shipping is a method of managing the supply chain. This is a method in which the retailer does not stock up the goods but delivers it to the customer directly from the manufacturer or a whole sealer. The process is very simple. Generally the retailer stocks up the goods in the warehouse. He or she sells them to his customers when they need it. There are possibilities that the expected sales might not happen. The drop shipping eliminates this scenario and creates the win-win situation for everyone.
Most of the shopify stores offers the drop shipping facility. It helps to run the business with the hassles of logistics. So there is absolutely no worries of inventory, packaging and also transportations. Here are some advantages of drop shipping.
The setup process
The set up process is very easy. The process involves only three steps. The first one is to find the supplier. The second is to build a proper website. The third is to market and start selling. The process of setting a properly functioning supply chain is a humongous task which the drop shipping eliminates.
The cost factor
When it comes to setting a store with the traditional business model, the predominant cost goes into the purchasing the inventory and running the store. The purchasing of the inventory which takes the major part of the investment is eliminated by the dropshipping method. So one can spend more on running the site and marketing it.
Less worry about the sales
We are saying that the owner of the site need not worry about the sales. The fact is there no goods stored in the inventory. If the business has already purchased the goods and has stored in the inventory, there is pressure to make the sales. It is because the owner needs to get the returns on what he has invested at the same time purchase the next order to continue the sales.
No constraint in location
All drop shipping needs is a properly functioning website. One can work from anywhere. The person can either work from his house or from a coffee shop. The only requirement of the person is properly functioning electronic device with the internet access.
The diversity in the business
One of the biggest advantages when it comes to dropping shipping is that any product can be sold on the website. There is not much of constraints or restrictions. One can either concentrate one product or can sell a wide range of products. All you need to do is zero on the products that you are going to sell in your site and find the supplier for it.
In a traditional business model, there is a lot of risks involved. But the drop shipping model the only thing that needs to be concentrated is sending orders to the supplier. Market your site properly, send orders to the supplier and get the profits.
Loss of damaged goods
The loss that is created by damaged goods is one of the very common things to occur in traditional methods. In drop shipping since the shipment is between the supplier and the customer the loss by the damaged goods is completely eliminated.