What is dropshipping and how does it work?

Dropshipping is becoming increasingly popular and represents an interesting alternative to the classic retail chain. But how does the whole thing actually work?

In the traditional e-commerce process, an online retailer buys goods in bulk from its supplier, stores them, and then sells them to its customers. In this case, the dealer himself takes care of the shipping. With dropshipping, however, things work differently: when you receive an order, you forward it directly to the supplier or wholesaler. Many online store systems (e.g. Shopify) support this type of redirection. Thus, the responsibility for packaging and shipping lies with the supplier and no longer with you.

This has advantages and disadvantages. On the one hand, you save yourself most of the logistical effort. On the other hand, you also have less influence on delivery times and product quality, which represents a certain entrepreneurial risk.