What is Dropshipping - How Does Drop Shipping Work

What is Dropshipping and How Does Drop Shipping Work?

Have you heard from a friend, a site, or a forum about dropshipping and want to know a little more about this concept? As you are at the beginning of your research, you are wondering how dropshipping works?

I suggest you give you a brief reminder of what dropshipping is. Then, I'll explain the difference between dropshipping and affiliate. Finally, I will explain how dropshipping works and you will give the name of several sites that practice this mode of marketing.

Also, note that I have written many articles to help you better understand how dropshipping works and how to get started if that is your project. Do not hesitate to consult them:

• Is dropshipping a scam?
• What legal status to choose for dropshipping?
• How to find your dropshipping niche?
• How to dropshipping with Aliexpress?
• Should you choose Shopify for dropshipping?
• Tip for free training in dropshipping?

By reading all of these articles, you should already have a lot of information to form your opinion on dropshipping and whether you want to embark on the adventure of entrepreneurship.

Please note that if you have any questions after reading this article, do not hesitate to ask them directly via the comments. I'll be happy to answer them as soon as I have a minute.

 

What is dropshipping? Definition

Dropshipping is a concept of marketing that aims to specialize in the different trades of e-commerce.

To put it simply, when you buy a product on the internet such as an iPhone or a computer, several trades have been requested so that you can buy and receive your purchase.

You have visited a site in the past through an advertisement or a search on Google or another search engine. It is thanks to the expert's invisibility on the internet or in online sales that you decided to visit this site (and not that of your competitor) and finalized your purchase. You've been the victim of a marketer!

Once your order has been finalized, the logistics sector has taken over: your product has been produced, packaged to be placed in a package and this same package has been transported until it ends up in your letterbox. . In this case, it is indeed logistical expertise that made it possible to transport your package.

So what is dropshipping?

When you dropshipping, you are selling a product that you don't have in stock. When an order is placed by an Internet user, your site transmits the order information to your supplier, who takes care of producing and delivering the product purchased by your customer.

As you can see, dropshipping allows you to create an e-commerce site without having to bear the cost of purchasing a stock of products. In addition, it allows logistics to be relieved, which allows the person who manages a dropshipping site to focus on a single task: to promote their products and make sales.

Basically, dropshipping aims to specialize in the two most important functions of online business:

    1. The owner of a dropshipping site focuses on his primary    expertise: marketing

    2. The supplier specializes in its primary expertise: producing and shipping products

Dropshipping or Affiliation, what are the differences?

Many people may wonder about the differences between dropshipping and affiliate shipping.

As a reminder, affiliation is promoting a product from a website and receiving a commission when the Internet user who clicked on the advertisement finalizes a purchase.

But suddenly, Dropshipping or Affiliation? What to Choose?

The big difference between dropshipping and affiliation is that in drop shipping, the Internet user buys on your website. You collect the money in this way. In affiliation, when the Internet user clicks on an advertisement that you have placed on your site, it is sent to the site of the supplier who finalizes the purchase.

The big advantage of doing dropshipping is that the Internet user becomes YOUR customer. You can thus try to retain him because you have his contact details and you can recontact him through emails and encourage him to buy back on your site.

How does it work?

Now that I have made this very important reminder so that you can understand the concept of dropshipping, I will explain to you how does it works.

As you will have understood, dropshipping involves 3 main players:

• Internet users looking for products

• A drop shipper who sells products without having them in his stock

• A supplier who has products and who takes care of the logistics.

How it works? Understand by example.

In dropshipping, an internet user places an order on a site run by a dropshipper, who acts as a distributor. The latter then transmits the order to his supplier who takes care of producing the part purchased by the Internet user and sending it to him.

As an example is always more telling, here is a typical example of dropshipping:

Jean is an internet user who wants to buy a cycling jersey. He goes to site X where he buys his jersey for the sum of € 100. Julie, the owner of site X, collects the sum of € 100 and places an order with her supplier, Mr. Y. She then buys the jersey bought by the Internet user for the sum of € 60 from him. Julie, therefore, earns 40 € and Mr. Y will take care of producing the jersey and sending it to Jean.

As you will have understood, Julie did not have Jean's jersey in stock. She served as an intermediary by allowing Mr. Y to sell a jersey to Jean. She thus benefits from a margin of 40 € that she can reinvest in her salary or other advertising and increase her income.

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Read also :

1. Is dropshipping is a scam or not?

2. Which legal status to choose to do Dropshipping?

3. How to Find Profitable Dropshipping Niche in 2021?

4. How to Start a dropshipping business with aliexpress?