Product Sourcing
Product sourcing is simply what its name implies: finding a source of products to sell. However, how a business approaches its product sourcing will have a dramatic influence on its prospects for sustainability, profits, and success.
A relatively new yet powerful form of product sourcing that is being utilized by business of all sizes to sell more products and especially to increase online sales is drop shipping. Drop shipping is a product sourcing and fulfillment model in which a reseller lists, markets, and sells a supplier's products without carrying the supplier's products in stock. When the reseller receives an order for the supplier's product, the reseller pays the a wholesale price to the supplier, who drop ships the product directly to the reseller's customer.
Advantages of Using Drop Shipping Product Sources
- You don't have to ship any inventory. Your supplier will ship the product directly to your customer with your invoice inside the package and your name and return address on the package, not theirs.
- You don't have to carry any inventory. You purchase the inventory from a supplier only after you have received an order from your customer. This way, you can save your money for growing your business instead of tying it up in inventory.
- You can offer a larger variety of products without any commitments. If a product doesn't sell, simply stop offering it and try something else. You're not stuck selling the products you have on hand.
- You can spend more time on finding new customers and retaining the ones you have by marketing, advertising, and providing great customer service to your customers.
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