Dropshipping

There are lots of business opportunities out there for young and upcoming entrepreneurs that do not require lots of capital for start-up, one of those business opportunities Is Dropshipping

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What is Dropshipping

Dropshipping is an e-commerce, business model where the seller of any goods does not keep in stock the goods they sell instead they purchase the goods from a third-party supplier and deliver the goods directly to the buyer without having to handle it.

In dropshipping all the seller has to do is set up an online store with products you're willing to sell, when a buyer places an order on those products you then make the order to the party supplying the product and the product will be shipped to the customer that places the order directly without you handling the product.

In dropshipping the seller is more of a middle man between the buyer and the supplier of the products just that in this case there is no need to have the product in stock or deliver the product yourself, all that has to be done by you is relate the order of the buyer to the supplier and the rest, as they say, is history.

What is required to start up a dropshipping business?

• Create an online store
• Look for international suppliers ready to deliver goods and has quality products at fair rates
• Create ads or join an online marketplace e.g amazon, Shopify, etc. that will connect you to thousands of potential buyers

Advantages of Dropshipping.

• Low-Cost Start-Up
  there is a little start-up cost needed to start a dropshipping business. there is no need for a huge capital to buy goods or a warehouse, all that is required is the initial cost of creating an online store that costs around $100-250 depending on who is billing, ad payment, or subscription fee for the marketplace that falls between $20-50 per month.

• Location Flexibility
  the fact that you don't have to handle the goods directly and it is an online platform means you have the flexibility of moving locations without having to worry about moving goods with you. It also means that there is no fear of losing customers because it's an online store so physical communication is not necessary.

• No Limitation of Product to Sell.
  Most physical stores are limited to the variety of goods to sell, hence some physical stores are labeled for instance we hear stuff like grocery stores, fashion stores, electrical stores, gadget stores, and so on. In dropshipping, you are not limited by labels or types of goods to sell you have the freedom to sell every and anything.

• Scalability
  no matter how big a store or a warehouse is it has limits to goods it can contain hence limiting how much you can sell at a time. in dropshipping, this is not an issue as there is no warehouse to store goods giving you the leverage to accept any order placed by a buyer and deliver.

Disadvantages of Dropshipping

• Low Profits
  profits made from drop shipping is low because you have to give a competitive price with the fellow drop shippers. Drop shopping does not require much cost to join meaning a lot of people will venture into it creating competitive prices to attract customers.

• Supply Error
  Deliveries are not done by you so there is a chance of the suppliers making a mistake and supply the wrong product creating a bad business PR for you.

Conclusion

Drop shopping is a helpful tool for young startups entrepreneurs with low capital to grow. It takes less of your time giving you the flexibility to do other things.