Drop Shipping is a method in which orders from the customers along with the shipment details are directly transferred to the seller. The seller can either be a wholesaler, retailer or a manufacturer. Seller then ships the ordered stock to the relevant customer directly.
If you see the below video you will Know Details What is Drop shipping and How To Create A Drop Shipping Business in 2020 .
Drop Shipping Developments :
There are many emerging companies working by drop shipping since 2006. Major ones are based primarily in USA. They provide these services to individuals as well as the companies. It is due to the enhanced e-commerce and internet. The suppliers based in China are able to serve within the country due to ease of trade barriers. Ali Express is used by many of them. Nearly 33% retailers are using it as a method to fulfill their orders.
How can products be reviewed?
For this, the retailer can either display the stock at a store or keep an online catalog for the customers at the time of purchase. The catalog helps to review the stock items.
Blind Shipping :
To keep the source of the product unknown, the retailers could take measures. Blind shipping means to ship a product without any return address. It can also be done by using “private label” which is customized return address to the retailer and not to the wholesaler. Details about the product, such as company name, contact information can be added on a packing slip. Retailers can earn their profit when there is a difference the retail and wholesale price on an agreed percentage.
Auction Products :
Drop shipping is also used by the auction sites to distribute the products. It can occur when a huge order for any product is received by a small retailer. In this case, that retailer has to arrange the demanded quantity of product to be sent to the customer.
The seller marks the product as new and it is shipped to the customer directly from the manufacturer or the wholesaler. Profit can be earned excluding the shipping fee.
E-commerce and Drop Shipping :
Drop shipping retailers are being served by e-commerce platforms to sell online. Shopify is one of the platforms making it easier for the sellers and customers. In 2018, shopify declared more than 800,000 businesses being run in 175 countries.
Problems with Drop shipping :
Everything have a negative side, drop shipping have too. There are lot of scammers. The victim will be sent a list of individuals acting as a middleman with no item of their own. The orders can be placed from the list. These middlemen leave little profit for the retailers.
A published article reports that there are some drop shippers who display the wrong product to the customers. Customers either receive the items that were not advertised or get nothing at all. Customers after receiving the product get to realize that they have paid more. So they want to return the item, and order directly from the manufacturer. It can result in losses to the retailers.
If You want to know how to create a drop shipping store using Shopify Check this Blog post: What Is Shopiy & How To Create Drop Shipping Store Using Shopify