What is drop shipping?

This is a closed chain that has three elements: physical customer, suppliers (originally wholesalers) and virtual marketplaces/retailers. It’s an endless cycle. The customer orders products from a retailer that doesn’t have a real stock, then the retailer orders those products from the supplier. Money moves between the customer and the retailer, and between the retailer and the supplier. Suppliers usually deliver the product to the customer, but there is another way of shipping: supplier -> retailer -> customer, but when you use this method you may need to rent a warehouse – but not necessarily. With drop shipping, you can be successful with your retail store in the long run with small capital investment.

Are you thinking about starting a Shopify online store, or you’ve already created that, and you’ve recently met drop shipping? It seems to be a good opportunity, and it is, but you need to know that there are more types of drop shipping as well. If you want to run your company for a long time successfully, putting just a small amount of money in it, you should take into consideration our advice mentioned below.

When you start your online store, you have to define what will be your main profile, what kind of products you will sell and who will be your target audience. After the designation, you will need to find your sources too, especially those, where your goods for sale will be coming from. You have the following options.

You can sell:

  • products that you make on your own,
  • products that you resell from other virtual retailers (and from marketplaces),
  • products that come from real wholesalers.

When people talk about drop shipping, they usually think about the last two options (and selling own products can also work with those two), but if you want to use the real method of drop shipping, that can bring you long-term success, it’s better to work with only wholesalers – and not with retailers and marketplaces.

If you use novel drop shipping, you don’t have to pick the virtual items one by one from the supplier’s list, but you get everything from them. They have data feeds – you get them – but they are in different file formats and there are different kinds of data structures too. So you will probably have a hard time with the manual settings. If you want this to be easy, you don’t have to do anything else but to use the right Shopify application, which can solve these problems easily.

If you want to know more about how to solve this problem, read our other articles about Syncee and how it works.

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