When you start a business, one of the biggest concerns is whether the products you have for sale will be liked by your audience. Even if you have a market study, the concern will remain present, until you begin to see the behavior of the customer with your products.
If everything is resolved in your favor, you will be left without products in stock and you will have to find how to supply new merchandise. If, on the other hand, you have problems selling the products that you already have in stock, this becomes a headache that you must eliminate.
Having product in inventory without movement is like having money stuck; If they are non-perishable, you have more time to create new sales strategies. But if you have a time limit of expiration, many times you will end up cheapening their price or giving them as a gift in the purchase of one of your new products. Yes, even if you have product in inventory, you need to improve your merchandise so it will accumulate if you do not do something.
You can spend hours thinking about which selling strategy works best to solve this problem, or you can continue reading and know a little unknown selling method, but that will surely be quite useful, especially if you are new to the world of sales and not you are willing to have money stored in a warehouse.
What is dropshipping?
To understand what dropshipping is , you need to be thinking of this term as a selling method that is probably much better known in e-commerce, compared to offline sales. With it you can sell products that you do not have in stock, and that someone else sends and delivers to your customers in your name.
When you work with a dropshipping strategy, your store sells a product but in turn, you buy it from a supplier who will be in charge of packaging and sending the product directly, without the need for your store to intervene. Sure, the shipment will be under your name, the product will have your brand and at the end of the process, the credit will be yours.
Compared to the traditional method of marketing, the advantage is that you save the purchase of products to have in inventory, storage space and costs related to the shipment. The time you previously invested in this task can be dedicated to improvements in your business strategy, which can improve other areas of your store.
While it is true that applies to most businesses, has its pros and cons.
Ideal for new businesses
If in itself it is difficult to start a business, coordinate all related aspects, pay bills and survive the first month without wanting to give up because you feel that neither the flies stop for your business, at least with your dropshipping strategy you can save yourself the worry to deal with physical products.
You do not have so many obligations
When you commit to a dropshipping provider, you technically delegate responsibilities that would have taken time away from you at another time. Some of these obligations are:
- Package and ship the product – You can negotiate with the supplier to use personalized labels with your brand logo. Similarly, if there is any special request regarding packaging, you can probably manage it for an extra cost.
- Rent of a warehouse – Whether or not you have a high volume of inventory, you must have a room in which to store the physical product. Probably this will generate extra costs that dropshipping can save you.
- Manage the quantity of products in inventory – Taking control of your products can be another task that takes time and generates unnecessary expenses. Avoid this and leave it in the hands of your expert suppliers.
You can have a wide selection of products
Since you do not need to have products in inventory, you can offer different products (that the supplier has in inventory) and thus expand the reach of your brand to other audiences.
You can find suppliers that handle this sales method globally. We recommend you check your reputation, compare prices, exchange rates and, above all, have an empathy with them. They will be your logistical partners, so you need them to be in the “same channel”.
Little committed providers
Technically, your brand is the one that faces the public, and the one that looks bad if the product does not arrive in a timely manner. As we mentioned in the advantages, you need to do a casting of suppliers to select the most appropriate one. Remember that you are going to invest not only money, but also reputation, so it is worth taking your time and identifying the provider that meets all your requirements checklist.
Enough quantity of products available
During the purchase process of a client, you can give at first only one piece, which you request from your supplier, committing to that amount. But, what happens when for some reason they ask you maybe double or triple of products? If the supplier has the product, you left the inconvenience; if you do not have it, you probably have to turn to another provider, hoping to offer you the same quality and the same price.
And although there are ways to synchronize your orders with your suppliers’ inventory, they do not always work perfectly.
Errors by the provider
Even the most experienced of suppliers in dropshipping makes mistakes when sending a product. The worst for you, they are not affected before the client; Your brand does it. You have to be aware that if this happens, you will be the one who should ask for an apology on behalf of your brand, remedying the damage in some way. These errors can range from losing items, sending to wrong addresses, using low quality parcels, etc.
If you are thinking whether it is worth or not to implement a dropshipping strategy, the truth is that we can not tell you with certainty a Yes or No. What we can do is recommend that you find out more about this method of sale (there are many dropshipping guides available) and ask you to check if this is what your brand and customers need. Above all, consider every positive and negative aspect that you create can be developed in your business. The above are just a sample of a panorama that only you as the owner of your business can know.