|Dropshipping business: an online business that is almost Awithout capital|
Dropshipping business: an online business that is almost without capital – You must have heard of the dropshipping business, or maybe you are currently running one. This business model is very much practiced by urban people in Indonesia, especially millennials.
Besides the practical way it works, the initial capital to start this business is very minimal. Even many people say the dropshipping business is a business without capital, is that right?
What is Dropshipping?
For those of you who don’t know, businessdropship is an online product sales system where the seller or retailer does not have to have their own product, does not need stock, and the capital is very small.
The dropshipping business has a different system from resellers. Dropshipping business people don’t have to buy goods first, just focus on marketing and doing customer service.
Dropshipping businessmen also don’t have to bother working on the packaging and shipping process of the goods to the buyer because the supplier will do it.
The good thing is, on the packaging / pack of goods sent to the buyer, it will be written that the goods were sent by the seller / retailer. However, for branded products, the brand or product brand will usually be marked.
Interested in starting a dropshipping business? Wait, first understand how it works.
How the Dropshipping Business Works
The dropshipping business system is actually quite simple. As an illustration, you can see the following dropshipping business schemes:
Here’s a brief explanation of how the dropshipping business works:
- 1. The seller selects several products from the supplier to be sold, then takes several product photos to be uploaded to the marketing media accompanied by a brief description.
- 2. Dropshipping businessmen market their products online, whether through social media, marketplaces, websites, forums, personal blogs, or online advertising.
- 3. Consumers order the goods they want to buy and send money for payment to the dropshipper according to the price of the goods specified. The seller takes advantage of the difference in the price of the cheaper supplier.
- 4. The seller then continues the payment process to the supplier of goods and provides information on the purchased goods along with the buyer’s data.
- 5. The supplier will package the purchased goods and send the goods to consumers by including the name of the dropshipper as the sender.
The advantages and disadvantages of dropshipping business
This dropshipping business does look easy to do, even the seller can run his business from anywhere, the important thing is that there is an internet connection and a supporting gadget.
However, of course, each business has its own advantages and disadvantages, as well as this dropshipping business. Here are the advantages and disadvantages of the dropshipping business:
A. Advantages of Dropship Business
1. Small Initial Capital
As previously explained, the dropshipping business can be run without having to spend a lot of capital.
Dropshipping business players can sell products online through social media sites (Facebook, Instagram), free blogs, marketplaces (Tokopedia, Bukalapak), through messenger applications (WhatsApp, Telegram), and through buying and selling forums such as kaskus.
Running this business, of course, must spend capital, for example, for internet costs. However, the costs incurred are minimal.
2. Very Practical
As a dropshipper, we don’t have to bother dealing with the procurement process, the packaging process, and the process of sending goods to consumers. All these processes are the responsibility of the supplier.
In addition, we also don’t need to bother with the complex business planning processes carried out by suppliers.
3. Can Be Done From Anywhere
We can do dropshipping business from anywhere, as long as we have an internet connection and adequate gadgets.
Relationships with suppliers or consumers can still be well established which can be done online, for example via email, chat, and social media.
4. Almost No Operating Costs
Unlike conventional businesses that require large operating costs, dropshipping businesses can be run with very little operating costs, or even almost no operating costs.
Costs usually incurred by a business are electricity costs, employee salaries, and rental fees. As for the dropshipping business, we only pay very small costs, such as internet connection fees and promotional costs.
B. Lack of Dropship Business
1. Profits Tend Small
The profit that the dropshipper can take is usually small. It is possible for the seller to raise a higher price, but of course it is very risky because it can damage consumer confidence.
Dropshipping businessmen usually will not set a price that is far from the price set by the supplier.
2. Information on Stock of Goods Not Up to Date
Information about the availability of goods cannot be known directly by the dropshipper because the data is with the supplier.
It is possible that a product that is going to be purchased via a dropshipper has actually been used up and the information has not been updated on the supplier’s website.
3. It is difficult to sell items that have never been seen
When a consumer asks for more details about an item, usually the dropshipper is less able to explain the details of the item because he really doesn’t understand the product.
Most dropshippers only focus on marketing without knowing the details and specifications of the items being sold. This of course will affect the consumer’s intention to buy the product, and usually consumers do not buy the item.
4. People Who Get Complaints
It is possible for a supplier to send goods whose quality is not as promised or the delivery process is late. And when that happens, of course the consumer will complain.
The buyer will not complain to the supplier but to the dropshipper / retailer. Whenever the buyer is disappointed with the goods sent or the delivery process is late from the supplier, the dropshipper will always receive complaints from customers.
List of Dropship Business Suppliers
This business will only be able to run well if the dropshipper collaborates with a supplier who can guarantee the quality of the goods and the quality of the service is good.
Here are some dropshipping platforms that can be used to find suppliers:
Each of the websites above has various types of products, so you should first determine what you want to sell. My advice, open the website one by one, study and find a supplier that suits your business needs.
Tips for Choosing a Dropship Business Supplier
Dropshippers must be selective in working with suppliers or suppliers to prevent things that we don’t want.
Here are tips for choosing a dropshipping business supplier:
- Choose a wholesale or wholesale supplier. Usually the wholesaler does not want to take a large profit per item sold, but on the large number of items sold.
- Select a supplier who already has a clear system, starting from the ordering process, checking goods, purchasing confirmation processes, to packaging and shipping goods to consumers.
- Choose a supplier who is easy to contact. However, we must understand that suppliers usually don’t want to take long to receive calls or chat with you because they have to serve many other dropshippers.
- Usually the supplier will ask for the name of the dropshipper and the name of the dropshipper’s online shop. This is needed for data on the sender of the goods to the buyer, the supplier will write the dropshipper’s name or online shop on the packaging of the goods sent to the customer.
This article actually only discusses the skin. In the process of running a dropshipping business, you will face many things.
In the process of running this business, you will spend a lot of time answering buyers’ questions.
Based on my experience in the dropshipping business, it is not uncommon for prospective buyers to just ask questions and not buy.
In the process of running this business, it is not uncommon for you to run out of time just to answer buyers’ questions.
If you want to run a dropshipping business, then you also have to prepare yourself for things like this. I hope this article is useful.