Advantages and Disadvantages of Dropshipping

Advantages of Dropshipping:

• Low or Zero investment: 

We don’t need to buy any inventory if you want to start this business, it doesn't mean that you need $0 to start this business, you need to spend to create a reasonable infrastructure and good investment is required for marketing. 

• No fulfillment issues:

Sellers don’t need to fulfil the items as items are fulfilled by the suppliers, so all the fulfillment responsibility is on the supplier!

• Easy to end the business:

If this business didn’t work well, it can be finished easily without any liquefaction of assets and ending  other liabilities. 

• Easy to Scale:

Dropshipping business is easy to scale, as sellers don’t need to spend on inventory! Sellers just have to extend the product range! 

Disadvantages of Dropshipping:

• Returns Issues 

Returns are the major problem in dropshipping, as suppliers have different refund and exchange policies, sometimes customers abuse the seller because of the supplier return issues. The best way to deal is to get a refund and exchange policy from the supplier, before you start selling! 

• No goodwill of the brand:

As we sell other brands products, so no goodwill is built for the seller! 

• No Control on price   

The supplier is taking control of everything and we use the supplier products, so we can control the costs as these things are in the supplier's hand!

• Supplier dependency

Everything depends on the supplier, supplier can create issues in shipping, returns, exchange, inventory or anywhere supplier wants. 

• No control to inventory:

Products can be unavailable at any time, and sellers can’t  estimate they will be back, Seller has 0 role in bringing the products in stock again! 

• No product improvement:  

If customers are facing issues in the product, you can’t fix it or make it better! Seller has to ask the supplier to do it, and in most cases the supplier doesn't bother about it! 

• Supplier can kick seller at anytime:

Supplier has everything in hand and supplier can kick the seller anytime the supplier wants!