The Relation Between Wholesale And Drop Shipping

Necessity is the mother of all inventions

Necessity is the mother of all inventions. Staying true to this saying, man has formulated many ways to manage the supply-chain. Earlier in barter system, there were just two parties, known as buyer and seller, then cometh the middlemen known as trader, wholesaler, supplier, distributors, and the likes. Today many kinds of trade suppliers work in their own capacities to manage the delivery of products from manufacturers to end users. Drop shipping is a relatively new way of selling products and unique in many ways. For example, unlike other types of trades, a drop shipping retailer doesnt have to buy a product before selling it to customers. As a dropship retailer, youll have to work in collaboration with a manufacturer or wholesaler (who is acting as a dropshipper). Dropshipping retailer will be having the image and product description to use in marketing, once theyve booked an order, theyll forward the order to dropshippers. It is the dropshipper who will be shipping the ordered items to the customer. The customers think they are getting the products from the retailer, while in actual fact theyre getting the products from dropshippers who are sending these products on sellers behalf.

A supplier can be a wholesaler and dropshipper at the same time, and it depends on the kind of services they are providing to retailers. To better understand the relation, lets take a look at this working example.

John is a college student whos looking to start his own business to earn some extra income for meeting his college and everyday expenses. He has done his research and concludes he can earn good profits by selling hair care products online, like Gel, Shampoos and conditioners. The standard procedure is to buy these products in bulk and sell for profits, but John doesnt have the cash in hand to buy these products, or he has the money but he doesnt want to take the risk of investing his money without giving it a shot first. Now, internet is a very low-cost medium for selling but how can he sell something without having the possession of actual products? Heres where dropshippers come into play. He can get in touch with a wholesaler or manufacturer who is providing dropshipping services for merchants who are interested in selling their products. Remember, the Dropshippers will offer lower prices because they are saving on marketing cost, since it is the merchant who will be marketing the products. To cut the long story short, John can simply work in conjunction with dropshipping supplier without having the need of buying or carrying the inventory, going through the chores of shipment, or dealing with returns of faulty products.

by: William

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