Drop shipping is a way to make money by selling a product to a consumer without ever touching the product. With drop shipping business model, you are essentially a middle man, sort of like a broker between wholesaler and the consumer.
Business model is simple to explain but fairly complex to get to work. You need to set up an ecommerce store on Shopify and contact suppliers whose products you want to sell. Once approved you can add the products to your website and start running ads on Facebook, Instagram, Google, or another platform to try to sell them.
When drop shipping you only pay for the product if you have sold it. So, let’s say Joe bought a basketball from my drop shipping store. I would receive a notification that Joe paid me and then I would go to my supplier’s website and order that product. Instead of entering my information, I would add Joe’s information into shipping address details. Since I get a discount on the product, I get to keep the difference between what Joe paid me and the discounted price that I paid.
However, that’s not just it. I also must pay for ads to get Joe to come to my online store. What first seemed like a lot of money, is now not looking as great once we take out the money we spent on ads.
Drop shipping still works until this day and chances are it will not be going anywhere. Chances are that you are very familiar with the world’s biggest drop shipper; Amazon.