Handy thoroughly understands the advantages and disadvantages of drop shipping. Although the company is a home service company, the CEO has previously death with product companies that export, import, and used various kinds of drop shipping. This is what Handy can tell you about drop shipping:
Advantages to drop shipping:
- Cost efficient – Drop shipping is significantly less expensive because you can own an ecommerce website without having to purchase inventory not knowing what your demand may be. To elaborate, the overhead required to maintain the business model is also cost efficient. There are few initial expenses as it can be run from anywhere with the Internet.
- Convenience – Running a business through the Internet allows you to work from anywhere.
- Easy to start and scale – The most labour required in starting up an ecommerce store is deciding which product(s) you want to sell and building your website. After that, business will only come with awareness however, your start up acquisition is easy capital, time, and effort. Although scaling comes with more expenses, managing inventory or production is a process that ecommerce managers do not have to worry about. As a result, their attention can be focused elsewhere.
- Diverse services/products – With no upfront inventory purchase needed, it makes it easy for entrepreneurs to include a variety of products on their ecommerce sites since they require absolutely no merchant handling.
Disadvantages of drop shipping:
- Low margins – Although there are low start-up costs, there is also a lot of supply. The abundance of e commerce stores has saturated the market. As everyone wants to remain competitive, they are lowering their prices. Thus, there is little margin to work with.
- No control of inventory – Not having access to the inventory means that you cannot manage it, order, more to maintain it, or monitor quality control. This includes shipping errors and shipping to the wrong addresses, individuals, or shipping the wrong inventory.
- Shipping costs – When many drop shippers are involved in the process, the price of the job increases significantly; time, customer satisfaction, and shipping costs.
For more insights about business ventures, drop shipping, and business tips and tricks, contact Handy using the link provided above. Their administration is built with individuals that come from many industries and business backgrounds which is why they understand so many industries thoroughly.