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Dropshipping In 2019
What Is Dropshipping?
Dropshipping is an already proven business model that empowers both seasoned and new entrepreneurs alike to build a business selling unlimited products without ever having to purchase inventory before an actual sell nor does dropshipping require stocking the items one intends to sell.
In it’s simplest terms, once a dropshipper sells a product they will buy it from their supplier, who will ship it directly to their customer.
5 Steps To Successful Dropshipping
- You as the Dropshipper find suppliers and then products you wish to sell to your potential customers and market/sell the products either in your own online store or on an online Marketplace such as ParkSideAve Marketplace.
- Your potential customer find the products they want in your ParkSideAve Marketplace Store and purchases the product from you at retail cost.
- You as the Dropshipper contact the Supplier who has the product in their stock and place the order directly with the Supplier at wholesale cost to you.
- You as the Dropshipper supply the Supplier with your customer’s address and the Supplier ships the product directly to your customer.
- As the Dropshipper, you sold the product at retail price – for example $215. You then purchased the product from your Supplier at wholesale cost to you – for example $145. You pocket the $70 which is the difference in what the customer paid you, and what you paid your Supplier to ship the product directly to the customer.
7 Benefits Of Dropshipping
- Dropshipping offers one of the lowest cost of entry into retail business. You can build an entire business online simply dropshipping and never having to invest in inventory in advance of purchases from customers. This means you can start selling without a lot of early investment because you don’t have to buy wholesale or cover the cost of manufacturing your own products.
- Dropshipping offers the best advantages to expand product lines into new markets. When you are faced with having to invest large amounts of money into inventory prior to selling products, this may drastically impact your capability to expand your product line. Having the ability to partner with Suppliers whom will supply you with and ship product to your customers as needed will remove any financial limitations to growing and expanding your product line.
- Dropshipping helps you to increase your cash flow since you don’t have to invest in and stock products. There is a lot of risk that comes along with having to invest in stock. Because with dropshipping you do not pre-pay for inventory before its sold, this enables you to keep more cash on hand for other business needs such as advertising your products and marketing your business.
- Dropshipping allows you to come to market faster. Dropshipping eliminates wait times when products are shipped from the Supplier or Manufacturer to the merchant. In some cases, the process for receiving and stocking inventory can be a few weeks. With dropshipping, a Merchant can start selling the moment the product is published on the ecommerce site. In effect positioning the Merchant to come to market faster and begin making profits faster.
- Dropshipping helps reduce costs of running your business. Every time you or one of your staff has to touch a product in the supply chain, there is a cost associated. Ocean freight services, Port Operations, LTL and FTL Services, and warehouse employees are all costs added into the cost of goods when sold. Dropshipping your product offerings directly to your customers will net your business a much higher profit margin.
- Dropshipping can help you increase the lifespan of your customers. With the ability to always be adding expanded and new product selections to your store catalog, you keep your existing customers engaged with fresh new offerings continually returning to see what new items you have to offer. Adding new products to your store catalog also works to attract new customers to your store.
- Dropshipping enables you to have virtually unlimited product lines. One of the main reasons the drop ship industry exists is to help retailers and suppliers combat inventory distortion: the 800 billion dollar problem of over-stock clearances and out-of-stock shelves. By tapping into inventory further up the supply chain via dropshipping, theoretically you can gain access to virtually unlimited inventory.