Make Money Online via Dropshipping in eCommerceIt is a golden age of eCommerce where people are lucky to live in a time where we can connect and sell with anyone in the world. So, in recent times there has been an exponential growth in Dropshipping.

What is Dropshipping?

Dropshipping is a special selling technique in which the seller does not keep goods in stock, but instead transfers their customers order and details to the drop-shipper, who then ships the goods directly to the buyer. Dropshipping is a retail fulfillment method where a store doesn't keep the products it sells in stock. Instead, when a store sells a product, it purchases the item from a third party and has it shipped directly to the customer. As a result, the merchant never sees or handles the product.

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What Makes It a Good Option For Entrepreneurs?

Using dropshipping means that when customer order products through your online store, these products are then delivered to your customers directly from your suppliers which no storage headache.

Why Pick Dropshipping?

Lower starting capital – anyone can start their own ecommerce business using dropshipping without having to break the bank or get an expensive loan. It’s a case of supply and demand – you only purchase the products you will definitely sell. As you manage your own profit margins you can play the market and use branding and persuasive copy to drive up the retail value of your products. The average profit of a manufacturer who drop-ships is 18.33% higher than a manufacturer who uses traditional channels. (The Journal of the Operational Research Society)

It’s a low risk – Every new business venture comes with its own risks, but dropshipping is less risky because you’re not locked into expensive stock or retail premises. If things don’t work out the way you thought they would, you are not stuck with loads of products you have to offload.

Wide selection of products – you can sell so much more through the drop shipping model because you

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don’t have to stock anything and you can change tact fast.

You can do it from your own home – you don’t have to worry about running a warehouse or stocking your products so you can manage your business from your bedroom. You have more independence and flexibility.

Things to Look Before Choosing Dropshipping Suppliers

Research dropshipping suppliers you are planning to use. Find out their past work and credentials

Buy from suppliers that have positive feedback and a score of around 95%.

Consider individual product feedback. Carry out random checks and test orders to assess

the company’s timing, communication, and overall customer experience for yourself.

 Thoughts from eCommerce Space

"Though drop-shipping is not a new concept in India, it is still gaining momentum and penetrating deeper into markets. It is popular with larger e-retailers who want to minimize investments in stocking up inventories. Apart from bigger players, several niche e-retailers are also using this model extensively," says Dinesh Agarwal, founder and chief executive officer, IndiaMART.com, a business-to-business marketplace.

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A drop-ship based business also offers greater flexibility to help identify niche products. Similarly, Drop-shipping helps manufacturers as well.

"Many brands and large manufacturers are not geared for retail sales. So they use the services of 'trading assistants' to manage the logistics for them. This could involve the provision of services such as listing and customer service or even stocking products and shipping them out," says Deepa Thomas, head, partnerships, eBay India, and an online marketplace.

On eBay.com, trading assistant acts as sellers who serve as the connecting link between manufacturers and buyers. They list the products online; handle sales queries, payments as well as shipping of product. This model is very similar to the drop-ship business model, except that the actual product fulfillment is also done by the seller in the former model.

WHY AVOID DROP-SHIPPING?

Like every other thing, dropshipping can carry some drawbacks:

Lack of control over product quality and deliveries Lower margin compared with bulk purchase of

products. Risk of supplier running out of product inventory Return of products and refunds pose logistical

problems and affect profits

Conclusion:

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There are challenges in starting a drop-ship based retail store but it remains one of the easiest ways to enter the booming eCommerce space of India. Once you have gained some experience and have had success, you can maintain an inventory of a bigger size along with better control over your own business. With an estimated current market size of $38 billion, e-commerce in India is expected to grow to about $120 billion by 2020 and dropshipping would be an integral part of it. 

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