Drop shipping

What is drop shipping?

Dropshipping is a special form of eCommerce. Retailers offer their goods in their online shop, but do not store them themselves but with the manufacturer.

This is how the model works in detail: Customers place their orders in the retailer's online shop. Only order acceptance and billing are then handled by the shop or the retailer. The goods are delivered by the manufacturer or wholesaler. As a customer, it is often difficult to tell whether it is a drop shipping model or not - there is no mandatory labeling so far.

The terms direct trade, drop shipment or direct shipping are also used as synonyms for drop shipping.

Pros of drop shipping

Easy entry into online trading

Easy testing of new products

Favorable prices for customers

Cons of drop shipping

Low profit margin for retailers

Little influence on customer satisfaction

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