subject: Advantages Of Adopting The Drop Shipping Fulfillment Model [print this page] Drop shipping fulfillment model has many advantages. The biggest advantage is that it saves you the cost of building up your own inventory. This is a very good option especially for start-up ventures where finance might be a problem. Drop shipping helps you use your cash for building up other business features, rather than tying your funds up in inventory that may not sell as fast as you want it to.
You are not left holding dead inventory that does not sell - a problem for many business owners. Money tied up in stock that is obsolete can affect your company's bottom line. You may be forced to offer huge discounts and incur losses to get over such situations. Yet, with a drop shipping fulfillment model, you steer clear of these circumstances.
With a drop shipping model, you do not have the hassle of shipping your products, which involves opening an account with shipping companies and employing people to handle shipping affairs separately. These both mean more money out of your pocket. The drop shipping model helps you save on the cost of hiring more people and the cash required to open shipping accounts.
As you are not bothered about ordering inventory, you can add the latest fast moving products to your website instantly at no extra cost. If a customer shows interest in a particular product, you can have that item on your list immediately.
There is a vast difference between an Internet-based supply system and supplies going out from a traditional business set up. An offline business model is associated with slower supplies, as they work on a logistical system that has huge limitations. For them, running a fulfillment system is a major part of their overall set up. Internet retail is comparable to mail order; the product delivery is completely outsourced and shipped to clients in parcel size packs. Delivery is done in the shortest possible time with this model.
One of the biggest advantages of drop shipping is that you do not pay for anything until after you sell it. The drop shipping model offers you convenience in the form of not having to own or rent a warehouse, hire people for the sole purpose of packing, shipping and managing the warehouse and the additional costs of warehouse maintenance. Having a third party to manage everything related to shipping can take a huge burden off your shoulders.
Drop shipping is a very transparent business. Once you establish a working relationship with a drop shipper, you can send them your company labels and forms, so that the package looks like it is delivered from your warehouse. Additionally, drop shippers give you a wide range of products to choose from so that you can sell much more. This would not have been possible with a brick and mortar stores without incurring huge costs of maintaining fresh inventory of newer products.
Drop shipping may cut down on your profit margins, but it is definitely a more preferred shipping option as it saves you on other expenses that you would have incurred by shipping products yourself.
While there is the risk of depending on a third party to deliver as per your standards and requirements, choosing an experienced and reliable drop shipper can help you overcome this issue without much hassle.
The drop shipping fulfillment model is growing exponentially and is being used more and more by large catalogue companies, auction sites and savvy websites.
Advantages Of Adopting The Drop Shipping Fulfillment Model
