Wholesale Or Dropshipping: Which is A Better Model for You?

You have an idea for a product or maybe a potential business, but that is just the beginning. A long road lies ahead, of which you need to assess each curve and bend before moving forward as considerable amount of risk is associated with it. Opening a business is not enough; you will have to consider the option of how you are going to acquire the products. There are a number of business models available in the competitive market; however there are two specific structures, namely wholesale and dropship, which are the most popular ones. Both sound vaguely interesting right? Well, worry not. For the article deals with the advantages as offered by both the models. Read on and make a wise decision.

Wholesale: For low risks and established products

When you buy products from a wholesaler, you just invest in goods that are already there in the inventory of the wholesalers and buy them directly from the manufacturers. Discounts are very common as products are bought in bulk. You can sell them at a higher price for that extra marginal profit. Wholesaling is a low risk business model since you are buying products that are already widely recognised in the market, with a further brand value to add to it. There is no way you can waste your time and money when buying products from a wholesaler.

This model is great for retailers who want to sell a variety of products and brands using the same platform.

Dropshipping: For less work and low financial loss

The main concept of dropshipping deals with you selling products that you do not own. You just act as a customer service medium, and when you get an order from the customer, you forward the request to the best dropshippers Canada who then goes on to fulfil the order. Though you play a significant role, the amount of work you do is actually less compared to the other business models. They take up the tasks of picking, packing and delivering the products, while you just need to make the sale using your chosen form of platform. The start-up cost is low and the probability of facing a financial loss is minimum. Profit margins depend on how much you charge the customers and how much the product costs originally.

This model is great for retailers who are running low on a budget and need backup to start a business.

Thus, whichever form of business model you choose, consider all your options before making an investment. Whether you are looking for a wholesaler or a dropshipper USA, a thorough research is a must!