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Drop shipping

Drop shipping is a form of retail business in which the seller accepts customer orders without keeping stock on hand. Instead, the seller transfers the orders and their shipment details either to the manufacturer, a wholesaler, another retailer, or a fulfillment house, which then ships the goods directly to the customer.

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Quick Answer: Drop shipping is a form of retail business in which the seller accepts customer orders without keeping stock on hand. Instead, the seller transfers the orders and their shipment details either to the manufacturer, a wholesaler, another retailer, or a fulfillment house, which then ships the goods directly to the customer. The seller is responsible for marketing and selling the product, but has limited control over product quality, storage, inventory management, or shipping. It avoids the costs of maintaining warehouses or even a storefront, purchasing and storing inventory, and employing necessary staff for such functions. Drop shipping has become a popular business model as it requires minimal initial investment and overhead costs. A drop shipping operation can be managed from any location with an internet connection.
DEFINITIONS
  • verbTo deliver goods for a business directly to its customers, as though the business owned a relevant inventory, but with the manufacturer as the real source of the delivery.
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