If you’re trying to decide between dropshipping and wholesale, you might find it challenging to determine the best option for you and your business. There are several differences between the two, such as some of the ones below, and understanding what those are may help you make your choice.
Some business owners need complete control over their company and day-to-day dealings to the point where they don’t hire employees because they prefer to do everything themselves. However, other business owners feel comfortable hiring employees or outside help; some are good with letting others take over all or the majority of control.
If you opt for dropshipping, you’ll have to be comfortable forfeiting a lot of control. The supplier handles much of the process, including directly packing and shipping items. Therefore, it is best to trust that the supplier will do things correctly because you will have little to no control over it.
Some business owners like ordering wholesale inventory, including holding items like the Bella + Canvas red crewneck sweatshirts in their hands to evaluate the quality and either ship the items out to customers or watch them buy the merchandise in front of them to ensure customer satisfaction. If that’s the case with you, going the wholesale route could be a good option, but if it’s not, you might find dropshipping ideal. Therefore, the supplier handles the inventory, so you’re not responsible for keeping any stock on your end, so you don’t have to worry about where to store it.
Dropshipping means taking the packing tasks off your to-do list. For example, when you buy wholesale and ship items out to customers, you or an employee are responsible for each package that heads out. Still, with dropshipping, the supplier handles all the logistics. Sometimes, depending on the dropshipping supplier, you can add custom materials, such as packaging, to ship out the products, but it may cost extra.
Should you decide to go with dropshipping, remember you’re going to have to trust that the supplier will pack each item appropriately so that nothing will break or spill and that they won’t forget anything. However, when you package the items yourself, you can do so in a way you feel comfortable that the products will get there intact and on time, and you’ll be able to know what you put in each package.
With dropshipping, the supplier manages the shipping, believing they will get the products out promptly. However, when you buy wholesale and ship to your customers, you’re responsible for everything, from ensuring the address is correct, packing the customer’s order, and shipping the package out and on its way.
Shipping out orders can be stressful for a business owner. Not only do you have to pack the items, but you also have to request package pickup by a particular time or get it to the post office or a shipping company before they close. The task can get even more stressful when you’re factoring in inclement weather or encountering transportation issues.
As a result, those who prefer to avoid dealing with that may consider dropshipping. However, it’s important to note that dropshipping orders may take an incredibly long time to reach their destinations, leading to customer frustration and poor repeat sales.
If you’re not handling the packaging or shipping because it’s the responsibility of the dropshipping supplier, you won’t need to worry about constantly needing shipping supplies on hand. Not only do you not have to worry about spending money on shipping supplies and finding a place to store them, but you also don’t have to find the right envelope, bag, or box to correspond with the products in each order.
When shipping out many orders regularly, you must always have various supplies available, ranging from tape to cushioning for more delicate items or other desired items you want in the order.
Between dropshipping and buying from a wholesaler, the former is the cheaper option for the initial investment. Therefore, there’s typically only a minimal monetary cost to start, and you don’t have to pay for much of what you would with selling wholesale products, such as buying upfront inventory, paying for shipping supplies, and the cost of having a brick-and-mortar store. You also won’t have to worry about losing money on a stock that doesn’t sell, eliminating the stress of worrying about over-ordering or under-buying items.
On the other hand, the initial investment is much more substantial when buying wholesale items to market online or via a brick-and-mortar store.
For many, the time gained by not having to deal first-hand with ordering, managing, selling, and shipping wholesale products is worth opting for dropshipping. Of course, many dropshipping tasks exist, such as listing products and handling customer communication.
Still, they typically require a lot less time than if you were taking every step of the process as you would be with selling wholesale items.
Dropshipping can take a chunk of profits due to fees and may involve lower profit margins if there’s significant competition with your products. However, the ability to sell a vast array of merchandise from one or more suppliers could be incredibly beneficial for bringing in money; chances are you’ll have to focus on selling as many items as possible.
In addition, selling wholesale products gives you a discount on what you order, especially with higher quantities. You may see more significant profits when the items sell easier.
When it comes to whether dropshipping or selling wholesale items is the better option, a solution could be better for everyone, and every business owner needs to decide which of the two they feel works best for them and their business. You can start by making a list of the pros and cons, researching, thoroughly learning about both options, and taking time to think about what would be better for you, your business, your stress levels, and your schedule in the long term. Then, ensure you make a small order to test the quality and the dropshipper’s customer service.