This is perhaps a somewhat new concept in online business but it is fast becoming popular.As internet usage continues to explode globally,online shopping is quickly becoming the norm.This ofcourse presents a lucrative business opportunity for online merchants which as a result makes for a profitable home business.Drop-shipping is deeply pegged on online shipping.It involves three parties:the buyer(consumer),the merchant(you) and the distributor/manufacturer.
So,basically,drop-shipping is a method of trading whereby,the merchant(website owner) becomes a stockless retailer who gets a distributor company or manufacturer to dispatch products to the consumer.The retailer doesn't have a physical storage facility and hence does not hold any inventory.When a customer orders a product online(via the website) or from a mail-order catalogue,the retailer then fowards the particulars of the customer to the distributor or the manufacturing company.The products ordered are then packaged and labelled then shipped directly to the customer by the dropshipping company.
As aforementioned,the dropship business involves three parties.The customer,the retailer and the manufacturer or wholesaler.Each of these parties play a specific role.The manufacturer role is to act as the warehouse and hold stocks of products for sale to consumers.He also takes the customer's order and fowards it to the dropship company.The customer or buyer is the one who places an order with the retailer.He pays the retailer an amount for the products to be purchased plus the shipping charges.The retailer then has to pay the manufacturer storage and shipping fees.
To get started as a retailer,you need to open an online store with a shopping cart that accepts credit cards on your website,other options to this is to sell on online auction sites e.g eBay.But the best way to go is through your site.The next step is to find a distributor or a dropship company who will do the product despatch for you.You will be required to open an account with the dropship company that you'll choose.The distributor then provides you with descriptions and images of products that you'd like to sell from them for you to display on your online store.Payments by the customer are made via credit cards.The charges should include shipping charges.The customer's order should be emailed to the dropshipping company.The details should include,the customer's name and residence address.
The manufacturer or dropshipping company will charge you the wholesale price plus shipping.The shipping costs are incurred by the customer not you since he pays for product plus shipping.It's a pretty good arrangement.However it is important for you to carefully select products that you are comfortable with.To find dropshipping companies,you can browse 'The Dropship Source Directory'.You'll find a wide array of dropship products to sell.
