Dropshipping has become an immensely popular business model amongst new entrepreneurs because it has a lot of convenience to offer. Put simply, it is a retail fulfillment method where you don’t have to keep the products you sell as inventory. Instead, when you sell a product, you purchase the item from a third party directly and then ship it to the customer. This means that you, the merchant, never has to handle or see the product. The primary difference between the standard retail method and dropshipping is that the merchant who is selling doesn’t have any stock. Instead they buy the inventory from a third party, which is usually a manufacturer or wholesaler, and then fulfill orders.
There are a number of benefits associated with dropshipping, which has contributed to its popularity. What are they? Let’s take a look:
Less capital is needed
Perhaps, one of the most notable benefits of dropshipping is that you don’t have to invest thousands of dollars in stock upfront when you want to launch an ecommerce store. Previously, retailers had had to tie up huge sums of capital for buying inventory. Also, the dropshipping model only requires you to buy a product when you have made a sale and the customer has already paid for it. As upfront investment in inventory is not required, anyone can start a major dropshipping business even if they don’t have a lot of money.
Easy to set up
Setting up an ecommerce business is a lot easier when physical products are not really a concern. When you decide to go for dropshipping, you don’t need to worry about finding or paying for a warehouse, tracking inventory for accounting purposes, packing and shipping products, handling returns or continually managing stock level by ordering products.
Another huge benefit of a dropshipping business is that it can be run from anywhere, as long as you have an internet connection. You can start dropshipping India or any other part of the world with ease. You just need to be able to communicate with your customers and suppliers easily in order to manage and run your business.
Since you don’t have to rent a warehouse or buy any inventory, your overhead expenditure is going to be very low. As a matter of fact, there are numerous dropshipping businesses that are run from home offices and cost only a fraction of what brick-and-mortar businesses have to pay.
Huge selection of products
As you don’t have to buy the items you wish to sell in advance, you can offer a wide array of products to your customers. As long as a particular item is stocked by a supplier, you can list it for sale on your platform without any additional cost.
A dropshipping model is considerably easier to expand as well and combined with the other benefits, it has made it a very attractive option when you are thinking of setting up a business. You can enjoy a great deal of flexibility and convenience with dropshipping in the long run.