Advantages of dropshipping
Dropshipping is very beneficial for retail stores or physical stores selling directly to the public that use catalogs for sales. The customers of these establishments are looking for specific products to meet particular needs and they do not seek to obtain their purchases directly as they would in a physical store. For this reason, the waiting time between placing an order and receiving it at their home is not an inconvenience for them.
When a physical retailer works with dropshipping
When an offline retailer works with dropshipping, he can place the new products or the most representative items in the most visible shelves of his store. The rest of the products in the catalog will be stored by the dropshipping supplier in their facilities. You can sell in dropshipping perfume, gifts, jewelry…
Dropshipping as an alternative to inventory control
One of the most important issues for retail vendors is inventory control. Traditionally, in a retail store, products are organized in the warehouse according to the manufacturer’s shipments and stored in a secure area before being placed on publicly accessible shelves. Therefore, it is essential to maintain adequate storage space, employ staff to manage the inventory, and invest in security measures to prevent theft and loss, both inside and outside the warehouse.
Significant costs that cannot be avoided.
All of this, of course, involves significant costs that cannot be avoided. If it is a question of orders of a large number of articles or products of considerable size, the cost that the retailer will have to assume increases considerably.
With dropshipping, the retailer does not need to manage a large inventory stored in its facilities. Therefore, more physical space in its facilities can be dedicated to the sale and display of its products.
We also don’t need to have many employees who spend most of their time managing, shipping, receiving, inventorying, and securing the warehouse. Moreover, due to the size of drop-shippers warehouses, products can be stored there for a longer period of time without being in the way, unlike a retailer’s warehouse.
Wholesalers (drop-shippers) usually work with several delivery companies, both national and international, agreeing on the priority and speed of sending the goods with the retailer, depending on the price ratio offered for the products.
The initial investment is very low and easily recoverable.
Implementing dropshipping within a company’s operating structure only requires costs related to the design and programming of e-commerce. The costs of promotion and customer service are the private domain of each business and can vary greatly from one to another.
It is not necessary to have an extra infrastructure for the storage and preparation of products.
The wholesaler drop-shipper manages all the logistics.
Retailers have access to the wholesaler’s entire stock. A warehouse professional manages the condition and shipment of the products, which avoids breakage, theft, and other related problems. The more important the wholesale supplier is, the fewer stock problems it implies.
Catalog of products always updated.
Dropshipping suppliers work with online systems to automatically update their product catalog. They also have automated solutions to develop their catalog.
No need to manage transport companies.
Negotiations regarding costs according to destination, weight, and volume with transport companies are managed by the drop-shipper, who decides with the retailer on the relevant prices according to their business relationship.
Help and advice for the management of returns and problems.
The majority of drop-shippers working in the European Union accept product returns and offer advice for problem-solving.