FEB | 2016
When a customer purchases a product from store, the item is purchased from a third party and it is shipped directly to the customer. As a result, the merchant never sees or handles the product. The major difference between standard retail model and dropshipping is that the selling merchant doesn’t stock the goods instead they purchase inventory as needed from a third party (usually a whole saler). There are many benefits in dropshipping.
Benefits of Dropshipping
Easy to Get Started
Ecommerce business is much easier to run, which means you don’t have to deal with physical products. With dropshipping, you don't have to worry about managing or paying for a warehouse, Packing and shipping your orders, tracking inventory for accounting reasons, Handling returns and inbound shipments, continually ordering products and managing stock level.
Lower Capital Requirement
Dropshipping can occur when a small retailer receives a single large order for a product. Here, you don’t need to spend more money in inventory, instead you only need to purchase the product which the buyer ordered.
Wider Product Selection
You don’t need to pre-purchase all the items that you sell to the customer, but you can offer large number of items to the customer and can satisfy them with the number of different models of products. A good wholesaler will keep retailers updated, however it's the business owner's job to aware of the quantities that the wholesaler has available.
You don’t want run behind a company or worry about fulfillment. You can do dropshipping business anywhere anytime if you have a laptop and an internet connection.