Dropshipping is another form of marketplace business. In dropshipping, you don’t have to keep your own inventory for the products you are selling. All you have to do is to keep a supplier ready and market those products of the supplier. Once you get the order for that product, you place the order to the supplier who is handling the entire supply chain of the product.
Example
Let’s understand this by an example. Avi wants to do an eCommerce startup. For that, he has to select the products he wants to sell and invest in stocking up the inventory of those products. He also has to get the taxation number, keep a supply chain ready, and probably an online portal where he would like his customers to place the orders.
Instead of doing all the above tasks, he simply starts dropshipping where all the heavy lifting job is done by the supplier. He now just markets the products which are available to the supplier.
Benefits of dropshipping
- No need to maintain Inventory
- There is no overhead in handling logistics and supply chain
- You need not worry about taxes, you get the profit margin as referring profit from the supplier. you can just show the earnings and do IT Filing as an individual. (Consult your CA for more information)
- No need to handle employees at a large level, as this can be done with a very small team to start with
Challenges of dropshipping
- You are the face of the customer, so be ready to face the repercussions of any kind of product/quality issue. You can’t give an excuse that it was not me, it was my supplier. Customers will not understand that excuse.
- Be careful in maintaining the addresses and customer information. This is a huge area of concern when it comes to delivery. example: placing an order of customer XYZ for product A to customer ZYX by mistake.
- Sometimes, there is a quantity mismatch. Suppose you ordered 2 or 3 nos. of product in the order to the supplier, but the supplier sends only one quantity to the customer but takes the payment of the full quantity. Then you will have to handle both the customers and the supplier to liaison out the missing quantity.
Things to remember when you do dropshipping
- Always provide the order id or AWB number to customers as soon as the product is shipped. so that they match it with the product label available on the delivery package. This will safeguard customers against any kind of scams.
- If you have got more than one quantity order from customers, don’t place all quantities in the same order, rather, place different orders each. for example – your customer asked 3 quantities of a wooden box, then instead of placing 3 quantities in the same order, place 3 different orders of the same product. Doing this will make sure there will be a high chance that the right quantity reaches the customer.
Who can do dropshipping?
It is not as easy or straightforward as it may seem. Anybody who is willing to try in this kind of business should be ready to
- Spend hours selecting the right products. Selecting the right products is the key here to success.
- Should have experience in dealing with customers in the right way
- Should have some buffer principal money to invest in case of returns and refund upfront to the customers.
Curious to Start dropshipping?
Are you curious to start dropshipping business and wondering where and how to start?
There are many dropshipping apps available for use in India. Some of the most popular ones include:
- Baapstore: Baapstore is a dropshipping app that allows you to find and import products from suppliers in India.
- SaleHoo: SaleHoo is a dropshipping app that provides access to a database of suppliers and products.
- CJ Dropshipping: CJ Dropshipping is a dropshipping app that allows you to import products from Chinese suppliers.
- AliDropship: AliDropship is a dropshipping app that allows you to import products from AliExpress.
- HotHaat: HotHaat is a dropshipping app that allows you to import products from Indian suppliers and sell them on eBay and Amazon India.
- Printful: Printful is a dropshipping app that allows you to print and ship custom products on demand.
- Spocket: Spocket is a dropshipping app that allows you to import products from suppliers in the US and EU.
- Modalyst: Modalyst is a dropshipping app that offers a range of products from US and international suppliers.
- AliExpress: AliExpress is a popular online marketplace that allows you to import products directly into your Shopify store.
The above apps may give you a kickstart with your dropshipping idea but might not be the perfect one or a profitable one in the longer run. These are just reselling apps and you should definitely keep working towards finding and establishing the right suppliers, and niche products category to flourish.
These are just a few of the many dropshipping apps available for use in India. When choosing a dropshipping app, it is important to consider your budget, the types of products you want to sell, and your target market.
Here are some factors to consider when choosing a dropshipping app:
- Price: Dropshipping apps can range in price from free to hundreds of dollars per month. It is important to choose an app that fits your budget.
- Product selection: Not all dropshipping apps offer the same products. It is important to choose an app that offers the products you want to sell.
- Target market: Some dropshipping apps are better suited for certain target markets than others. It is important to choose an app that is a good fit for your target market.
- Features: Dropshipping apps offer a variety of features. It is important to choose an app that has the features you need.
- Customer support: If you have any problems with your dropshipping app, it is important to have access to good customer support. Choose an app that offers good customer support.
Once you have chosen a dropshipping app, you can start setting up your dropshipping business. This process can be a bit daunting, but there are many resources available to help you get started.
Further Readings
- https://en.wikipedia.org/wiki/Dropshipping
- best practices of dropshipping business
- Why the tweaked dropshipping i.e. reselling is failure business model in India?
Feel free to share your thoughts on this topic in the comments section below 👇 We would be happy to hear and discuss the same 🙂
