Let’s take a look at what Dropshipping is and why it is so popular nowadays.
Dropshipping makes it incredibly easy for sellers to launch online ecom stores because they don’t have to maintain inventory or handle shipments or manufacture products. The accessibility and simplicity of this type of dropshipping business model enable anyone to break into eCommerce, and, thanks to Shopify — one of the top best and leading eCommerce platform for online retailers with more than 1.5 million users worldwide — selling a variety of products via dropshipping is easier than ever.
Now what is dropshipping?
Dropshipping in simple terms is a fulfillment method in which the seller or the dropshipper doesn’t keep the products it sells in stock. Instead, when an order comes in (on the seller/dropshipper store), the seller/dropshipper transfers the customer’s order and shipping information to a third party, such as a manufacturer, wholesaler, or a dropshipping app like Alidropship or Spocket retailer that then ships the product to the customer. The retailer curates and markets products but never actually handle any items that are sold.
Now let’s take a look at some pros and cons of Dropshipping
Pros and cons of dropshipping
There are a lot of advantages to using dropshipping for your eCommerce online store; however, there are some advantages and disadvantages as well. We’ll explore both below.
Pros of dropshipping
- Not much capital is required to start. One of the greatest advantages of dropshipping is that it doesn’t require a lot of investment to get started because you don’t have to purchase inventory or hire any warehouse for your store. You pay for the product only when it’s been purchased and the buyer has paid you.
- It’s simple and easy to manage. Since you don’t have to purchase, house, maintain or ship inventory, it’s easy to launch and manage your store from anywhere in the world. This also enables you to spend more time and resources on your store design and the marketing of your products.
- There are few overhead costs involved. In addition to not having to purchase inventory upfront, you also don’t have to pay for other common e-commerce costs such as inventory storage or fulfillment.
- You can sell a variety of different products to different audiences at the same time. There’s no shortage of products available to add to your dropshipping store, and with no upfront costs, there’s nothing prohibiting you from providing your customers with a wide selection of items.
Cons of dropshipping
- There are typically low margins. The ease and low cost of setting up and managing a dropshipping store mean that there’s a lot of competition in the dropshipping space, so it’s not uncommon for retailers to price items incredibly low.
- You have no control over inventory or supplier issues. When you’re not stocking and managing your own inventory, it can be challenging to ensure items are always available, especially when you’re working with suppliers that also provide products to numerous other retailers. However, certain integrations, such as Alidropship or Spocket can help you avoid these issues by permitting you to seamlessly integrate suppliers’ inventory with Alidropship or Spocket by automatically syncing inventory.
- Shipping costs can be higher. When you source products from multiple suppliers, shipping costs can become complicated and pricier. For example, if a customer orders four items from your store, each of these items may ship from a different supplier across the globe, which means you’re paying four separate shipping fees.
- Customer service can be challenging. Mistakes happen in eCommerce, and when you’re working with multiple suppliers and not directly managing inventory yourself, it’s a given that there will be mishaps. You may sell a product that’s currently out of stock, a shipment may go missing or a customer may receive the wrong item, just to name a few. However, you’re responsible for communicating with customers and correcting mistakes even if you’re not directly responsible for the errors.
Main Reasons Why Use Shopify For Dropshipping?
Shopify is one of the most popular eCommerce platforms on the planet. Over 1.5 million merchants already use Shopify to run their businesses, which is likely because it’s flush with amazing features that’ll enable online store owners to succeed with their online stores. And, of course, if you’re looking for any features which aren’t innately available on Shopify, you can find an app from the Shopify app store to supplement your store’s needs. Below are some of the reasons why using Shopify for dropshipping is the best.
- Shopify platform is Dropshipper-friendly – One of the best things about Shopify is the platform is friendly with solutions that are specifically made for dropshipping. One example is Oberlo and Spocket, a dropshipping app that works with Shopify.
- Shopify is packed with great features – Shopify offers a host of features that let you create a complete dropshipping eCommerce business (not just a website). In addition to its online store builder, which enables you to design and set up your site, Shopify also has features to handle your sales, marketing, and payments.
- Shopify is extremely super easy to use – Shopify is one of the most user-friendly solutions out there. It may be packed with features and functionalities, but it doesn’t get overwhelming. The company does an excellent job of guiding merchants on how to use its software.
There you have it.