Why Drop Shipping Is Good For Your Retail Business

By: markwaugh28 | Posted: 06th April 2011

The popularity of dropshipping is rising. Rather than sticking to the old business model of buying supplies and then selling to retail customers, many businesses nowadays prefer to dropship products because of its manifold benefits.

Low Investment

Thanks to drop shipping, now you can start your business with little or no investment. As the products are directly shipped from manufacturer or wholesaler to end customers, there is no need to invest in supplies, buy or lease warehouses to store supplies, or hire manpower for tasks like inventory management, inspection of supplies, security, and handling and shipping of goods. The only thing that you need for starting your dropshipping business is a good website through which you can sell your products.

Low Risk

The risk involved in a dropship business is very low. Because you do no have to invest in inventory and warehouses, there is a minimal risk of loss. For instance, let us suppose you are a traditional retailer who sells cell phones. You buy your cell phone supplies from a wholesaler and then sell them through your online or brick-and-mortar store. As cell phone models keep changing quickly, there is always a risk that, if your phones do not sell fast, you may pile up a huge inventory for which you may not be able to get good prices due to low demand. But, if you dropship cell phones, there is no such risk of decline in the value of your inventory as you do not own one. Moreover, it gives you an opportunity of selling the latest and hottest products that are in demand and can fetch you good profits.

More Options

Drop shipping allows you to sell a wide range of products. You can sell almost anything that is available with your dropship wholesaler. This is because, in dropshipping, you do not have to buy and store stock, and therefore, you do not have to choose a very narrow niche in order to keep the risk of loss low. For instance, if you start an online clothing store but decide not to dropship, then you probably will have to decide whether you want to sell men’s, women’s, or children’s clothing. Not only this, but you might even have to choose between casuals, formals, and party wear in order to keep the cost of procuring your supplies low. But, if you dropship clothes, then you can sell all types of clothes as you do not have to worry about investing in huge inventories, and there is no risk of piling outdated stuff.

Saves Time

In drop shipping, you do not have to spend your time on buying supplies, managing stock, and driving to the post office for shipping products to your customers. This leaves enough time for you to focus on the key issues of your business, like what to sell, how to market products, how to retain customers, and how to keep the cost of running the business low.

Dropshipping can help your retail business grow to greater heights, provided that you choose the right dropshipper. If you are keen to dropship products, you should spend a little time researching for the best dropshipper. You may use drop shippers review and wholesale review websites for this purpose.

Drop shipping saves time as well as money. But, remember there are many scams in this business too. For information about dropship scams and how to avoid them, please visit www.dropshippingscams.com.
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Tags: business model, clothing store, minimal risk, profits, cell phones, manpower, brick and mortar store, brick and mortar, old business, inventory management, warehouses, cell phone models, hottest products, decline, retail customers, dropshipping