There has been a lot of buzz about Shopify dropshipping lately. People are saying things like “I made $20,000 my very first month with Shopify dropshipping!”. This is probably because we believe they are too good to true. Dropshipping is not a viable business opportunity for most people. However, many eCommerce retailers use it as a viable option.
Dropshipping has many benefits
Physical Warehouse
Drop shipping products do not require a warehouse to store them. Most businesses will spend $500,000 on a traditional distribution center. Dropshipping is a way to reduce the number of people required to manage, operate, and maintain a shipping distribution centre.
Shipping & Handling
Dropshipping can eliminate the second largest liability, shipping and handling costs. Dropshipping allows eCommerce sellers to retain a greater profit margin. They no longer have to hire workers to load incoming merchandise, log it in the system, place it on shelves, pick it up from the shelves, pack it and ship it.
Environmental Benefits
Dropshipping is a business practice that has many environmental benefits. This is something that is often overlooked. Transport-related carbon emissions are mainly caused by large ships, planes, and tractor-trailers. You can prevent an incalculable number of greenhouse gases from entering the environment by allowing the merchandise to be shipped directly from the distributor to the eCommerce merchant. When the merchandise is presented to customers, it appeals to many environmentally-conscious buyers.
Dropshipping has its negatives
Dropshipping isn’t all sunshine and roses. Amazon is North America’s largest dropshipping business. Amazon offers traditional order fulfillment through its large network of distribution centers throughout the continent. However, sellers can list their products on Amazon for a small charge. A notification is sent to the wholesaler or manufacturer of the item when it sells. The item is then shipped from the shipping facility.
Cutting Out
Dropshipping is an ethical business transaction. Dropshippers will become less common as more transactions are made online. Dropshippers can become unnecessary middlemen in the same way as extra shipping and handling cost were eliminated from the equation.
Manufacturers will soon realize how much they are losing to dropshipping eCommerce merchants, and their fees. They will then decide to sell directly to consumers via their own eCommerce store. Dropshipping can be a lucrative business model, but dropshippers must continue to innovate in order to maintain their relevance.
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Dropshipping
What is Dropshipping?
Dropshipping simply means that eCommerce retailers sell an item on behalf of a manufacturer, wholesaler, or distributor.
An eCommerce retailer would normally purchase goods from a wholesaler or manufacturer at a discount, then inventory the product and list it on their website at a markup. Once the product was purchased, they would ship it. Dropshipping eliminates the need for shipping and handling fees.
How does Dropshipping work?
Dropshipping is a relationship between an eCommerce retailer and a manufacturer or wholesaler. Once the relationship has been established, the retailer can list the products they wish to sell on their site as if they have them in stock. This is where the traditional eCommerce model gets flipped.
A notification is sent to the wholesaler or manufacturer that owns the product when a customer buys the product from an eCommerce retailer. The manufacturer or wholesaler then ships the product directly. The agreed-upon product cost is paid to the manufacturer or wholesaler, while the fee is paid to the dropshipper for completing the transaction.
This business model has its pros and cons, which can vary depending on the product being sold.
Application Integration
You have an eCommerce store and would like to add products that can dropship without you having to leave your warehouse. It can be challenging to integrate Shopify Dropshipping.
It won’t be a good idea to call or email the wholesalers or manufacturer each time you place an order on your website. Dropshipping compatible applications can be used to communicate between your eCommerce store, the wholesaler’s distribution center and the manufacturer. This application should be able keep track of stock information and order notes, as well as any other information. Once the information has been exchanged, the application must be able to update your website accordingly.
Find the right application for you
It can be difficult to find an app that has all the functionality you require and integrates with your existing eCommerce platform. It is a good idea to make a list of all the requirements you need and then start looking at the available options. Spocket is a popular platform for dropshipping. It offers native integrations to Shopify.
Conclusion
Shopify dropshipping can be a lucrative business and bring you large returns. Dropshipping is a thriving industry, but it’s also very risky for those who decide to only sell dropshipped products.
source https://www.groovecommerce.com/ecommerce-blog/shopify-dropshipping
