What is drop shipping and could it suit your business?

First Things First

Drop shipping is a supply chain management solution. The process involves you – the retailer or company – no longer holding stock but instead transferring responsibility for stock, fulfilling your customer orders and shipping, to a third party. It is outsourced supply chain management. Why is drop shipping popular? Because it saves a significant amount of time and money on the exertion of running and operating a warehouse and fulfilling your orders.

You can read more about drop shipping here.

How Does It Work?

This image is an accurate, simplified version of the drop shipping process:

  1. Your customer places an order in the usual way and makes a payment to you.
  2. The order is sent directly to your chosen drop-ship supplier, along with payment for the goods.
  3. Your drop-ship supplier fulfils the order and delivers the product directly to your customer.

Could Drop Shipping Suit Your Business?

Whether you are an ambitious eCommerce retailer or coordinating national fundraising campaigns; drop shipping undeniably removes the headache of warehousing and supply chain management. It is an increasingly popular choice as the benefits can include:

  • Lower logistics and fulfilment costs
  • Total supply chain management
  • Convenience and practicality

What are the Business Benefits?

You can reduce the risk of having excess inventory – making your business less susceptible to loss. There is no need to plough funding into new product launches as they no longer require an investment before they can be sold. You do not pay for stock until a sale. This allows you to manage cash flow and build and run your online business with greater ease.

You can bid farewell to in-house storage facility costs and can offer a wider variety of products, that you perhaps previously couldn’t consider due to size or space restrictions.

All the hassle of picking and packing products, inventory management and packaging costs are removed.

Your drop shipping partner will likely have access to better shipping rates due to the large volumes they handle.

To your end-customer, the process looks and feels the same. Many drop shippers will allow you to supply your own labels, providing ongoing branding and the personal touch for your business.

EC Group has the experience and resources to take your business to the next level. Our comprehensive range of valued-added services include: drop shipping, fulfilment and logistics, response handling, and more.

Is drop shipping the next logical step for your business?

Get in touch with one of our experienced account managers to have a chat about how we can help.