Store Front Alternatives – Drop Shipping
Wholesale drop shippers, ebay drop shipping, wholesale products drop ship
Overview
The advancement of e-commerce has brought in a very popular form of retailing
that is known as “Drop Shipping”. In this method of retailing, the retailer
does the advertizing, the selling and the collecting of money but the
actual shipping of the product to the customer is done either by the manufacturer
or the wholesale dealer of the product. The profit for the retailer comes,
broadly, from the variation in price between the wholesale cost and the
price the customer pays.
Advantages
One of the advantages of drop shipping is that the retailer does not have
to carry inventory. Cash flow is better since the customer pays for the
product before getting actually getting it. In as much as it is the responsibility
of the supplier to ship the product, the retailer is saved from the hassles
of packing and transporting the material and other overheads. This kind
of retailing is not limited to online transactions and can be well utilized
in traditional retailing also as many wholesale businesses provide point
of sale merchandise for display in retail store fronts.
Disadvantages
When there are advantages there are bound to be some disadvantages also.
Lack of control is one of the main issues such kind of retailer have to
face. Since it is a kind of middleman game; problems, when they rear their
heads can cause real headaches. The possible problems are back-orders,
delayed shipping, customer refunds and returns. Profits may erode if you
go in for a relationship with drop shippers that charge a drop shipping
fee or a member ship fee