Is Dropshipping the perfect business model?
Of course, that will all depend on who you ask and on your personal preferences.
But it is definitely very possible to make an especially strong argument for dropshipping. This is a business model that has huge advantages over selling your own products, over becoming an affiliate marketer and certainly over making money from adverts. It has all the strengths of each and none of the downsides of any of them.
This is a business model that allows you to work from home and earn passive income, while at the same time building a big brand for yourself and selling real physical products.
So why isnӴ everyone getting involved in dropshipping already? Why do so many people still choose to make money as an affiliate marketer instead?
The answer is simple: a lot of people still donӴ know what dropshipping is, or how to get involved in it.
It doesn't take much to start your own dropshipping business and without a great deal of startup capital, you can start making money by selling products with your own branding without having to spend any money upfront or take any form of financial risk.
DidnӴ I say it was the perfect business model?
What is Dropshipping?
Dropshipping is technically a Ҧulfilment modelҮ Fulfilment in a business term, of course, means delivery, so in this sense, dropshipping is the manner in which orders are delivered to customers.
Normally, selling a physical product means that you need to buy numerous items and then sell them at an inflated price. The way you would normally do this is as a reseller. Here, you would buy wholesale items(inventory bought in bulk at a discounted price) and you would then sell it on at an inflated cost and keep the difference (your profit margin).
The problem with this model is that you need to make a big investment in the stock first of all and then that you have to deliver the products to your customers. This means youӲe taking a financial risk by ordering the stock in advance (if you make zero sales, then youӬl have lost out on a lot of cash). At the same time, it means you need to not only pay for the shipping but also handle all the administrative tasks. YouӬl need to constantly take stock of your inventory and youӬl need to refund customers for deliveries that donӴ arrive.
In short, itӳ a lot to take on for an individual hoping to run a business from home in their spare time.
Dropshipping changes this because now the wholesaler is handling delivery and they donӴ require you to order in bulk.
So all that you really have to do is list the items for sale in your online store just like you normally would and then when a customer orders them, you pass that sale on directly to the wholesaler. They then send out the product on your behalf and make sure it reaches the buyer and you get the money!
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