Drop shipping is a product delivery method in which a
seller accepts payment for an order, but the customer receives the
product directly from the manufacturer. The seller's profit in the
transaction is the difference between the wholesale and retail price of
the items sold. This process offers advantages to both retailer and
manufacturer, but it's not appropriate for every seller or product.
Delivery Method:
This
delivery method is commonly used by smaller retail shops,
Internet-only stores, and those who primarily use catalogs for sales.
These stores' customers don't always expect to walk out of a physical
store with their purchases, and so accept a slight delay between
ordering and receiving the product. Stores that do have a brick and
mortar component often display representative items on their shelves so
that consumers can see and feel them before buying, but the actual
products are sitting in a factory's warehouse. Sellers on Internet auction
sites also
commonly drop ship, running auctions for items they don't
physically have and then drop shipping them from the manufacturer to the
highest bidder. Saving time and money as a seller and helping the small business that doesn't know how to sell online to get buyers.
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