Dropshipping is a business whereby you promote the products of a particular manufacturer and take orders and payments directly from your buyer. The manufacturer or the source supplier will fulfill the order on your behalf when you pay them and place your order. In the process, you make money by marking up the price of the product and paying the supplier the actual cost of the product. You don’t have to maintain stock or inventory of the products, save a lot of time, yet make money in the business.
Briefly put, this is how the drop-ship system works:
- You generate and accept the order.
- You take your profits out of the sale price.
- You forward the order and the wholesale cost to the drop shipper.
- The source manufacturer ships directly to your customer.
So obviously you also save money as there is no inventory cost to be incurred by you. This results in higher profits to you over what most regular affiliate programs allow.
This process has been there for many years in what was known as the mail-order business. It was widely used by direct response marketers and catalogers, who made profits in the business. Buyers used to order items from mail-order catalogs and supplies were delivered directly to them. It actually was drop shipping.
There are many online directories that provide necessary contact information for drop shippers of several products and brands. One should be beware of any drop ship source asking you to pay a fee in order to become a drop-ship dealer, or requires a membership. These are generally organizations that make their money selling “drop ship licenses” and are most of the time scams. Legitimate drop shippers and manufacturing sources never charge you any fees to drop ship their products.
Almost all types of products, whether electronics, consumer products, agricultural & industrial products, office equipment & supplies, hobby gear, recreational/sporting goods, clothing, furniture, etc. are available for a drop shipper.
The advantage to the manufacturer is that they get many active marketers promoting their products… at little or no cost.
If you are an online marketer interested in offering high-profit products to your niche market (your website visitors) without incurring high front-end development or inventory costs… then dropshipping is for you. You can quickly set up inexpensive, highly targeted, niche, or mini-sites to test and promote diverse products.
Internet marketers are uniquely positioned to take profitable advantage of the drop ship arrangement and should give this system a serious look.
You can make great money by buying things for a low price, and then re-selling them on websites like eBay or Amazon.