What Does Drop Shipment Mean?

In today’s cutthroat business environment, it does make sense for every profit-driven business to find ways to reduce operating costs and maximize operational efficiencies. This is exactly the reason why more and more businesses are now moving to drop their products by using order fulfillment services.

The best part is that drop shipping also helps budding entrepreneurs who are low on budget to start an online business by buying a readymade website for sale from BE BIGGY and start selling the best products to sell on Shopify.

One of the biggest advantages of dropshipping is that it shortens the procurement process to obtain bigger profits. Under this form of supply chain management, the retailer (reseller, agent) does not hold any inventory when selling products and therefore does not pay any warehousing expenses. Instead, the supplier (providers, wholesaler) sends the products on behalf of the retailer to the customer. In other words, the retailer never sees or processes the physical products and therefore it is easy to start dropshipping business without money.

What Is Drop Shipment-What Is A Dropshipping Business

To help all readers come on the same knowledge platform, it is time for us to answer some common questions like “what does drop shipment mean”, “what is dropshipping business”, “what does Shopify do”.

Drop shipping can be classified as an order fulfillment strategy wherein the retailer does not buy or hold products in inventory but instead relies on the manufacturers or wholesalers to actually ship orders on his behalf to his customers. This arrangement has several advantages for everyone involved. The manufacturer or wholesaler is spared from the exhaustive tasks of creating and sustaining demand and promoting sales by spending countless hours on marketing channels; this aspect is looked after by the retailer. On the other hand, the retailer creates and sustains demand and promotes sales by spending countless hours on marketing channels and is spared from the exhaustive tasks of manufacturing products. Since the retailer holds no inventory, he showcases a huge variety of products to choose from that is a huge benefit for any customer.

Shopify is an eCommerce platform that allows budding and experienced entrepreneurs to start or revamp their online business. It does this by allowing web stores to make use of its platform to sell products online. However, a blank web store in itself is not sufficient to garner sales and here comes Shopify experts like BE BIGGY that specialize in pre-made websites for sales that can be used to showcase and sell products.

How Does Drop Shipping Works?

Let us understand the entire process of dropshipping to gain a clear and complete understanding.

1. The budding retailer purchases a ready-to-go-live Shopify dropshipping web store from BE BIGGY.
2. BE BIGGY delivers a stunning, custom, professional, fully-automated, and ready-to-go-live web store to the retailer within 24 hours. This store comes preloaded with the best products to sell on Shopify and their packaging and shipping are facilitated by the dropshipping supplier.
3. The retailer starts promoting the Shopify dropshipping business store on different marketing channels like Facebook, Twitter, Instagram, etc.
4. Customer visits the store and buys an item from the store and makes a payment for it.
5. The retailer gets the order and forwards it to the supplier. The supplier is paid a wholesale price by the retailer.
6. The supplier ships directly to the customer on the behalf of the retailer.
7. The customer gets the product. The retailer gets profit based on the price difference between the amount paid by the customer to the retailer and the amount paid by the retailer to the supplier and is spared of the manufacturing, inventory, packaging, and shipping expenses. The suppliers get the products (lying at the warehouse) purchased and shipped and are therefore spared of marketing expenses.

Benefits Of Dropshipping

Small Amount Of Start-Up Capital

Unarguably, the biggest advantage of drop shipping is that the retailer is not required to spend even a single dollar on inventory. Moreover, the retailer has nothing to do with packaging and shipping and this obviously means that the retailer is spared from hiring new employees and paying their salaries. Since the entire task of packaging and shipping lies with the supplier, the retailer can focus efforts and resources just on promoting and selling the products.

Purchase Protection To Retailers

Most manufacturers have to deal with products lying unsold or unclaimed in their warehouses for months and years. With perishable and trending products, there lies a great risk that the product will be of no use and will not give back any value in addition to bringing a loss to the manufacturer (expenses already incurred on producing or manufacturing the perishable and trending products) if they remain unsold. Since the retailer does not have to store inventory, there are no such risks.

Broad Range Of Product Offerings

Since the retailer is not supposed to buy or hold inventory, there is an absolute freedom for him to showcase as many products as possible on the Shopify dropshipping eCommerce store. This not only provides a rich and wide variety of products to the customers to choose from but it also enhances the chances of making more sales and eventually profits. For instance, a retailer initially dealing in beauty products for women may add fashion and lifestyle products to the store.

Easy To Start And Saves Time

If you decide to start a drop shipping business, you as a retailer would never have to deal with physical products. Things will be easier for you as you would not have to deal with:

• Warehousing management;
• Product packaging and management;
• Processing returns;
• Foreign exchange calculations, taxes, tariffs, etc.

Management Of Out-Of-Stock Products

It means that you will have more time to optimize, market, and sell your store products while the supplier handles everything from warehousing to shipping.

Highly Scalable

It is extremely easy for you (as the retailer of a Shopify dropshipping business) to scale the business as you don’t have to manually fulfill each order.

Flexible Workplace

Starting a dropshipping business allows you to work from anywhere, anytime! All you require is a stable internet connection, a desktop/laptop/Smartphone to communicate with the suppliers and customers of your business.