What is Dropshipping and how it works?

What is Dropshipping and how it works?

Dropshipping is a supply chain management model which enables firms to meet inventory demands while cutting on redundant inventory management. Essentially, instead of stocking the products themselves, it purchases the item from a third party —usually a wholesaler or manufacturer— and has it shipped directly to the customer. This reduces storage and inventory carrying costs, while also helping reduce inventory turnover.

The key distinction between dropshipping and the standard retail model is that the seller doesn’t stock or own inventory. The key of dropshipping is the potential for faster delivery because inventory is available from multiple locations, some of which might be in closer proximity to the customer than the company’s own warehouse. 

Running a successful dropshipping business means that you have other tasks like managing your website, periodically updating your product offerings, marketing, adjusting pricing strategies and virtual inventory management, rather than physical supervision.

Benefits of Dropshipping

Disadvantages of Dropshipping

How Does AdvancePro helps in managing Dropshipping

Managing a virtual inventory using manual data-entry on spreadsheets or other legacy software is very time-consuming and makes it almost impossible to manage operations as the business grows. As your business increases in size, you’ll be selling your products across multiple channels using multiple vendors. 

Managing all these processes requires automation, thereby reducing the chances of errors and streamlining the flow of easily accessible information. A good inventory management application such as AdvancePro can simplify dropshipping and is your ideal partner in any business endeavor. Here are some features of AdvancePro that will make your business successful:

• Multi-channel Selling: AdvancePro can be integrated with all your sales channels, such as Shopify, WooCommerce, Amazon and more to ensure your order fulfillment is all connected.
• Order Fulfillment: AdvancePro lets you create dropship purchase orders directly from your customer’s sales order, with the requisite shipping information automatically added.  
• Vendor and Supplier Management: With AdvancePro, you have full flexibility to change/update the dropship order to account for vendors’ changes and reroute that information to your customer.  
• Payment Processing: Apart from virtual inventory management, our software enables fully automated billing. After receiving confirmation that the dropship has been dispatched by the vendor, AdvancePro will simultaneously create the required invoices: one to pay your vendor and the other to be dispatched to the customer. 

Speak to an AdvancePro team member today and start your journey with a trusted partner onboard!

About the author