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How to Dropshipping in 2021?

 

How to Dropshipping in 2021

How to Dropshipping in 2021?

Everything you need to know about dropshipping: definition, concept, advantages, disadvantages, how to dropshipping, how to find the best French and foreign suppliers, tips for having a profitable dropshipping… etc.

 

His advantages? Its disadvantages?  How to create a cheap dropshipping site? Etc...

 

For several years now, I have been supporting e-merchants in setting up and developing their online store. Etc.

 If you want to know everything about dropshipping in 2021, I think this guide can give you a big part of the answers to the questions you are currently asking yourself.

This article is VERY long (5000 words) so click below on the section that interests you if you need a specific question answered. What you will find in this guide:

 

  • Definition of dropshipping
  • Advantages and disadvantages of dropshipping
  • How to create a dropshipping site
  • How to find suppliers
  • How to get started in dropshipping
  • Example of a successful dropshipping site

Tips and advice for success

First of all, I will give you a definition of dropshipping and introduce you to the concept. Then, I will give you the main advantages and disadvantages of dropshipping whether you are on the side of the e-merchant or the supplier.

I will also give you several tips on how to use it wisely on your e-commerce site. For example, I will give you lots of tips for finding reliable dropshipping suppliers. I will also present to you the 2 most used solutions currently in France to create a dropshipping site.

If at the end of reading this article you still have any questions about dropshipping, feel free to ask them in the comments section, I will try to answer them ASAP!


What is dropshipping in 2021?

Before giving you the advantages and disadvantages of dropshipping , I quickly suggest that you give you a definition and introduce you to the concept.

I will also show you that dropshipping is already used by the biggest e-commerce sites, and for several years now, without you really being aware of it.

 

Definition of dropshipping

The easiest way to give you a definition of dropshipping is to take the first sentence of the Wikipedia page dedicated to this sales system. From my perspective, this is the simplest and most understandable definition of what dropshipping is.

Drop shipping (in French "direct delivery") is a three-party system where the customer (the consumer) places an order on the website of the distributor (the merchant), who transmits it to the supplier (the wholesaler), who ensures the delivery and manages stocks”.

 

Wikipedia

In addition to this definition of dropshipping , Wikipedia gives us a small diagram that allows us to illustrate the concept very simply:

Dropshipping, a system used by the largest e-commerce sites

The supplier or also wholesaler in dropshipping , who takes care of the production and sending of the products sold by the distributor: he also specializes in his core business, namely production and logistics.


Dropshipping, a popular system on marketplaces

On reading this definition of dropshipping , it appears that this system has been used for many years by most of the large known marketplaces such as Amazon, Ebay, Priceminister, Rueducommerce ...

Indeed, all of these sites offer brands / companies / producers to sell their products on their sites in return for a commission on the sales made.

For example, on Rueducommerce, if you buy a product from the marketplace, it is not Rueducommerce but the merchant who put the product up for sale who will send you the purchased product. It is typically dropshipping.

 

What are the advantages and disadvantages of dropshipping?

Now that you know a little more about the concept, I suggest you share with you all the advantages and disadvantages that this marketing system can cause.

So that you have all the arguments to convince your future suppliers, I will give you the advantages for the dropshipper but also for the supplier.

These advantages can help you convince suppliers because you will be able to give them the right arguments.

 

What are the advantages of dropshipping?

The advantages of dropshipping for the wholesaler / supplier

When talking about the benefits of dropshipping , most of the sites that deal with this topic only present the benefits for e-commerce sites. Very few of them do have the benefits for the providers. I told myself that it would be interesting to take an interest in the benefits that these players could derive from such a system.

In my opinion, the main advantage of dropshipping for the supplier is to avoid having to invest in a distribution site on the internet.

 

Selling on the internet, an expertise that is difficult to master

Indeed, it is true that wanting to sell on the internet is attractive for all companies. It's a good way to recruit new customers and earn valuable margin points through direct distribution.

However, it is not because a producer has an e-commerce site that he will necessarily sell and for good reason, selling on the internet is a not so easy task that requires significant expertise.

As a reminder, FEVAD counted more than 200,000 merchant sites in France in the first quarter of 2019. And on this mass of sites, 66% generated in 2014 less than € 30,000 in turnover, or less than € 3,000 per month. You will easily understand that it is not because we have an e-commerce site that we are selling!

And this is the advantage of dropshipping for a supplier  : he can concentrate on what he can do, which is to say produce, and let the merchants take care of the distribution.

This is for example what many brands do on Amazon: Samsung, for example, sells its products via the Amazon marketplace but is content to produce and send the products purchased via the American distribution giant.

 

The advantages of dropshipping for the e-commerce site

Dropshipping has several advantages that encourage many e-merchants to take an interest in this operation. In my opinion, there are two that stand out from the crowd: the absence of risk linked to the stock of products and the absence of logistics management.

 

The financial aspect, the most attractive advantage

This is surely the main advantage of dropshipping  : as an e-merchant, if you use a catalog of products in dropshipping, you will be able to sell products on your site without having to bear the financial risk of the stock.

Indeed, as we saw in the presentation of the concept, the e-merchant sells products that he does not have in his stock. It is the dropshipping supplier who takes care of the production, assumes the risk on the stock and who takes care of sending the sales made by the e-merchant's site.

Thus, it is possible to create an e-commerce site and make its first sales without having to invest several thousand euros in the purchase of a stock.

 

Logistics, a distant memory

The other advantage of dropshipping  for a merchant is the lack of logistics. As I mentioned above, it is the supplier who takes care of sending the product that has been purchased by an Internet user.

And for the e-merchant, it is a real workload less. Logistics is a job and not everyone likes to be involved in packing and sending packages.

By freeing himself from logistics, an e-merchant frees up time to focus on what he really knows how to do: distribute!

And this is a real advantage because to be able to make sales on the internet, it is necessary to have multiple expertise and to have the time necessary to implement them: natural referencing, paid referencing, ergonomics, social networks ... etc.

 

What are the disadvantages of dropshipping?

The disadvantages of dropshipping for wholesalers

Dropshipping can also have its share of downsides for a supplier. In my opinion, the most important is related to the conditions imposed by the largest sites. The other drawback is linked to the lack of control over the information that will circulate about the products sold.

 

Dependence on the conditions of large e-commerce sites

The main disadvantage of dropshipping for a wholesaler is related to the conditions that the main merchant sites may impose.

Indeed, we were able to see above that, on the internet, there are distribution mastodons. Among them, the American giant Amazon. In France, the main e-commerce sites such as Cdiscount, Rueducommerce and others all have very strict conditions for the sellers of their marketplaces.

It is on these sites that a dropshipping wholesaler will make the highest volumes of sales. It is therefore natural to want to integrate them. However, these registrations pose problems linked to the conditions imposed by these large sites: commission rates, production of content for product sheets, specific rules for logistics, etc.

As you will have understood, integrating a market place involves specifications that can be complicated for the uninitiated. And if, with patience and skill, the wholesaler manages to meet the demands of the different marketplaces, they will not hesitate to sweep away all this work if another wholesaler offers them similar products with a higher commission or even to get away from it all. Source directly from its competitors.

For smaller e-commerce sites, the dropshipping wholesaler can easily impose his conditions. However, sales volumes will surely be lower and logistics problems will be multiplied by the number of distributors.

 

Lack of control over product information

The other disadvantage of dropshipping for a wholesaler is the lack of control over the information that will circulate on the internet. We will see later that for a merchant site to be able to position itself in the results of search engines, it will have to personalize all of the presentation sheets for the products sold in dropshipping.

This thus implies a problem of the veracity of the information communicated by the reseller sites because we are then confronted with a basic problem of communication:

  • What the supplier has written to present their product is not always what the merchant will understand
  • What the merchant will write about a product does not necessarily correspond to reality.

By offering products in dropshipping, a supplier thus loses control of the information that will be conveyed on the internet with respect to his products. This can harm the products as well as the brand image of the supplier.

  

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