Dropshipping is a business model that gets plenty of comparisons to affiliate marketing. They are not the same type of business. Affiliate marketing, first and foremost, involves selling a product on behalf of another business who dictates the price and the terms under which it is sold. Affiliate marketing is also oftentimes synonymous with multi-level marketing, a dubious business model that tends to funnel money to the top and to leave the bottom dry. The things that distinguish the two business models are very important and define why one is used by legitimate businesses and why the other is not.
Legitimate wholesale dropshippers simply operate a warehouse that contains a large quantity of items. They offer these items to retailers at wholesale prices. Thus far, they differ in no regard to a standard wholesaler. What does differentiate them are the quantities in which they’re willing to sell. Most warehouses will only sell large quantities—oftentimes entire palates—of items. A dropshipper has no problem with shipping small amounts of items, even individual orders. Of course, the discounts may be less than if you ordered a thousand of a specific item, but the tradeoff is the lack of overhead.
A multi-level marketing business mitigates risk by shifting it off of those at the top and putting it entirely on the shoulders of those at the bottom. The resellers at the bottom represent the clients of those at the top. Legitimate wholesale dropshippers are not really business models. They’re warehouses that provide ways of fulfilling orders and nothing more. The risk mitigation takes place only at the level of the retailer, who mitigates the risk of inventory by simply not having any taking up space in their home or at their storefront.
Legitimate wholesale dropshippers also allow you to set your own prices and to use your own brand name on all of your shipments. With affiliate programs, the brand name is that of the product that you’re selling. A drop shipper is also not in direct competition with their own customers, as is a business that works with affiliates. The affiliates, of course, have to jack up the price of the item to turn a profit, and really just serve as a means of advertising for the original manufacturer. A dropshipper sells only in wholesale, and is not a competitor for their own clients.
Build a Profitable Drop Shipping Business with a Drop Shipping Wholesalers List
