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No need for big starting capital: So you want to open an e-commerce store and get in the game. But you do not have thousands of dollars to back you. All you have is an enthusiastic group and a dream. Buying a warehouse, and getting the entire operations set up, is beyond your limit currently. You cannot stock up inventory. With the dropshipping model, you don’t need all these. All you need is to partner with some local sellers and draw up an agreement to list their products on your beautifully designed website. So you only need to focus on maintaining the business and the website, not the inventory management and so on. And as more products sell, you can slowly decide that which products sell so much, that it would be better if you had a personal inventory of them.
Low Overheads: Your overhead expenses can be so low, with this model, that until you see the account-book, you wouldn’t believe it. Many dropshipping websites, actually run their entire business from a home-turned-office, and a bunch of geeks with laptops, at less than a few hundred dollars per month. The expenses will likely increase with time, but will definitely be lesser than the brick-and-mortar stores.
The flexibility of Location: Not located in an industrial capital? Worry not. As long as you have internet and telephone connections and you can communicate with all the people that you are running your business with, you can practically run your business from anywhere in the world.
Wide Array of Products: You need not pay for what you list. In fact, as you grow, you can charge your sellers based on which products they want on your front page. Since there is no need of any pre-purchase, you can display all the products, that your seller-partners have to offer.
Scalability: Like most businesses, growth is not always a positive scenario. It might be that through word of mouth, your business grows so much, that your number of monthly orders is doubling every month. In this case, a normal business would collapse. Dropshipping websites would not. Since the sellers will be taking care of meeting the excess demands, and you will be benefiting heavily.