Pros and Cons of Dropshipping Explained
- Author Lindsay Heidbrink
- Published October 24, 2011
- Word count 346
Dropshipping companies are just like any other wholesaler out there in that they allow you to sell their products online. However, unlike most wholesalers who require bulk purchases, dropshippers allow resellers to purchase small amounts of an item. The dropshipper then ships these single orders directly to the customer who purchased the item from the reseller. Resellers don’t need to warehouse large amounts of product and ship them off individually per their customer’s orders. Dropshipping allows online business owners to sell products without ever handling the product themselves.
When online resellers first learn of dropshipping, the most popular reaction is one of incredulity. Dropshipping can seem almost unrealistic because of the flexibility and earning potential that it gives to online business owners. However, resellers should know that dropshippers must balance themselves out financially between their wholesale and dropship clients. What does this mean for dropshipping-hopefuls? There will most likely be a slight elevation in costs.
Here are a couple ways that dropshippers even out their costs:
-
Higher Prices. Dropshippers raise their reseller discount or wholesale price for dropshipping clients. The wholesale discount is usually offered at a certain purchase price tier, requiring the reseller to make larger orders. Although the dropshipper will offer a discount for smaller amounts, don’t expect it to be the wholesale price.
-
Higher Shipping Fees. Dropshippers also need to make up money lost on shipping. Shipping larger orders to one address is less expensive for the dropshipper than sending out individual packages. Generally, you can expect a shipping fee of an additional couple dollars per item or per address for dropshipping orders. Dropshippers pay more to have smaller amounts of items shipped, so they pass on some of this expense to the reseller.
Contrary to common knowledge, dropshipping is not a rarity, nor is it complicated. It is a genuine, increasingly popular reselling method that has taken the ecommerce world by storm. If you are interested in dropshipping products online, keep these pricing differences in mind so that you are not unpleasantly surprised when you receive your first invoice.
Lindsay Heidbrink is attending Brigham Young University and will receive a BA in Communications: Public Relations in April 2012. She currently works for Marketecture,a company that provides website construction/hosting. Visit http://www.Marketecture.com/ for more information. These articles are part of Marketecture’s continued efforts to help SMBs build a better business online. Lindsay likes reading, writing, painting, and scuba diving, among other things.
Article source: https://articlebiz.comRate article
Article comments
There are no posted comments.
Related articles
- Why does your business need eCommerce product listing services?
- How Powerful is 20000mAH Power Bank?
- The Future of E-commerce: Trends in Shopify Subscription Boxes for 2024
- Survey Equipment in Australia: Tools for Precision and Efficiency
- The Transformative Impact of ECommerce on the Airfreight Industry
- What is the difference between ebook cover and book cover?
- The Real Reason Why You Need a Professional Website Designer: Hire a Professional Website Designer on Fiverr
- Meet Sellvia, an ecosystem that includes all the ecommerce, and marketing features you need to start, your business.
- Stay Connected with Beeper Pagers: A Timeless Communication Tool
- How to Design Custom Labels for Your E-commerce Store
- Sustainable Lifestyle Through an Online App Platform
- What Shopify developers can do for your e-commerce
- Equinox Gold Mines Gold Directly to Consumers with New E-commerce Platform
- Affordable Government-Accredited Aged Care Courses for Caregivers
- eCommerce Future: Trends to Watch
- Affordable Government-Accredited Aged Care Courses for Caregivers
- Here is a List of Dos and Don'ts if You Wish to Loan Your Car for Cash in Dorset
- Dermatological Solutions!
- The Transformative Power of Yamaigel’s Certified Gel Eye Masks
- MK Web Celebrates Top Position in Bourne's Premier Web Design Rankings
- Leveraging Branding Assets and SEO in Phoenix for Business Growth:
- Strategies for Getting Invited to Amazon Vendor Central
- Accounting Systems in Sri Lanka: A Comprehensive Overview
- InsightLeap: Helping Amazon Vendors Achieve Greater Success
- Choosing The Right Customer Data Platform (CDP) for eCommerce
- The Future of Cryptocurrency in the Nigerian Financial Services System: A 2024 Perspective
- Driving Business Growth With Retail Returns as a DropShipper
- E-Commerce and AI: A Perfect Match - If Done Right
- Investing in Eternity: The Long-Term Value of Buying Diamonds
- Profit-Driven Strategies for Your Magento Eсommerce Website