subject: Considering The Pros And Cons Of Your Options In Online Business [print this page] Innovative concepts in business have opened up newer avenues for profiteering. This is all the more evident in the field of ecommerce. One such trend in the online market is drop shipping. What exactly does a drop shipper do? The chief job is to acquire products from a wholesaler and get it to the customer.
The next question is how it differs from common retailers. A retailer orders bulk quantity of products, he gets the shipment, he maintains an inventory, he gets orders from customers, and he packs and delivers the products to the customer. A drop shipper, on the other hand, does not require maintaining an inventory.
A drop shipping service advertises the products on its website, gets orders, and provides the customer details to the wholesaler. It is the responsibility of the wholesaler to pack and deliver the product(s) to the customer. The drop shipper gets the products at wholesale price and sells them off at the retail price; the margin is his profit.
Like all business practices, drop shipping solutions also have certain advantages and disadvantages. If you are interested in venturing into this sector, be sure to do a thorough research of the market and weigh the pros and cons before taking the first step. Here is a quick glance at the positive and negative aspects of the matter.
Advantages of drop shipping:
No need to have an inventory
No need to order bulk quantity
No question of maintaining a stock
No headache about unsold goods
No packaging and shipping costs and hassles
Note: You need not depend on your website only for selling products. The Ebay or Amazon integration helps display the products on their website. Every day, thousands of web users visit these sites. This is hugely helpful for any business as you get to reach out to numerous potential customers with ease.
While the advantages of drop shipping may seem quite alluring, it is better to have a good idea about the disadvantages as well. Only when you know the right way to avoid those can you manage to profit from your online business.
Disadvantages and how to prevent such pitfalls
Many argue that it is all too dependent on the wholesalers. If you get a wholesaler who is not up to the mark, you may end up on a loss. This is a difficult problem. Follow the old adage Look before you leap and you wont face any such difficulty. Before you agree to work with a wholesaler, do a thorough background check.
There is another convenient way to check whether a wholesaler is fraud or not. In most cases, a reliable wholesaler would want to work with a dependable drop shipper. This is why they would ask for your tax returns and business related documents. If they dont, better check them out before entering into an agreement.
Choosing a good wholesaler also ensures that you need not face any problems like poor quality products, improper packaging, and subsequent complaints from unsatisfied customers. This is a sure way to tackle the business and profit from it as well.
by: Daniel Smith
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