Dropshipping

Dropshipping is selling something you do not own. A customer orders on your website and you pass that order to a supplier, who packs the item and posts it straight to the customer's door. You never touch the box, and what you keep is the gap between what the customer paid and what the supplier charged you.

The appeal is easy to see, because there is no warehouse, no shelves and no money tied up in goods that may never sell. You can list two thousand products on a Monday morning without buying a single one. That is why it is the model Linkysoft is asked about most often by people opening their first online shop.

Now the honest part. Margins are thin, often between five and twenty per cent, because the same supplier sells the same goods to everyone who found the same catalogue. Advertising then eats most of what is left. Delivery is slow when the warehouse sits on another continent, so a customer who waited three weeks rarely orders again. Returns hurt most, because the parcel comes back to you or to a foreign address while you refund money you already shared with somebody else.

The quiet killer is the stock file, because your website only shows whatever the supplier's list said the last time it was read. If that list arrives once a night, you will sell things that ran out at lunchtime and then write the email nobody wants to write. Ask a supplier how often the file updates before you ask about price, since every few minutes works and once a day does not.

If you still want to try it, run it like a real shop rather than a shortcut, and start with the stock. Storek keeps supplier stock and your own stock in one list, so a page never promises what nobody has. Linkysoft has connected shops that buy from three suppliers at once, and that job is almost always a small web application rather than a ready-made plug-in. The reason is that every supplier sends its file in a different shape. The sellers who stay in business choose a narrow range and order from their own site once, so they see exactly what the customer sees. They also print the real delivery time on the product page.