Dropshipping is a retail fulfillment method in which 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 seller doesn’t have to handle the product directly.
Here’s how the process works:
- A customer places an order on the store’s website.
- The store owner passes the order and shipping details to the dropshipping supplier.
- The supplier ships the product directly to the customer.
- The store owner pays the supplier for the product, minus any agreed-upon discount.
Dropshipping can be a convenient and low-risk way for entrepreneurs to start an e-commerce business, as it allows them to sell products without the need for large amounts of inventory or storage space. However, it also has some challenges, such as the potential for longer shipping times and the need to carefully manage relationships with suppliers.