Lack storage space? Concerned about the time and energy required to manage inventory and shipping? Want to get your online store running sooner than later? Consider drop shipping. If you’re an e-commerce site owner, this means that instead of stocking and shipping on your own, your orders are fulfilled by a third party who ships the item directly to customers. You may be running the show … but you may never see or handle your product.
Does this sound like a possibility for you? Read on for three great reasons why drop shipping may be a good choice for your e-commerce business.
#1. Getting started is a snap. Without physical products to manage, you can focus on setting up your site, marketing and keeping your customers engaged – there’s no need to arrange or pay for storage, track inventory, manage stock, pack/ship your products, or track returns. Your drop shipper takes care of everything!
#2. Lower upfront costs and overhead, plus convenience. You’ll require less capital as you launch, because with most drop shipping models you’ll pay for products after customers purchase them. Consequently, your overhead is likely to be lower, which helps keep your business in the black, especially at the start. Finally, you can run a drop shipping shop from anywhere, as long as you have an Internet connection so you can communicate with customers and suppliers – no warehouse or office is needed.
#3. Scale and selection. With drop shipping, it’s more manageable to keep up with upturns in business, which helps your operation grow without taxing your time and energy. On that note, you can keep customers engaged by continually offering a wide selection of new products at no personal risk to you or your business, since you don’t need to pre-purchase them. If they don’t sell, you aren’t out an investment of inventory.
Of course, there is a downside to drop shipping, too. The benefits of drop shipping come at a cost to the seller, so your revenue may not grow as quickly as you may expect. Also, keep in mind that other sellers like you may use the same drop shipper – and possibly undercut you on price! You’ll need to relinquish some control over your business, and pay extra-close attention to shipping costs, particularly when you offer products from multiple drop shippers. Finally, if there’s an order problem, since it’s coming from your storefront, you’ll need to be prepared to work with the customer and drop shipper to make it right.
The Bottom Line
Certainly, there are many factors to consider when considering drop shipping for your e-commerce business. Carefully consider the points outlined above, and you may find drop shipping to be an easy way to start selling quickly.
