Views:434 Author:Site Editor Publish Time: 2021-06-29 Origin:Site
In today's e-commerce market, drop shipping is considered one of the most promising e-commerce business models due to its simplicity and low level of risk. With drop shipping companies or dropshipping agents, you can sell products to customers without actually stocking the goods yourself. Today, 33% of companies in the global e-commerce industry use direct shipping as their main inventory management model, and China has become the largest direct shipping supplier. With direct delivery from China, you can quickly get up and running an e-commerce website while reducing financial investment. However, it is not always good. Do you know what are the risks and advantages of dropshipping business in China?
Advantages of Dropshipping in China
1. Lower Price
Historically, China has invested heavily in large machinery, housing and manufacturing technology. It has a complete logistics structure, mass production and low labor costs. Chinese manufacturers can provide competitive discount prices in their production. Therefore, if you are looking for affordable store replenishment options, then a direct shipping company in China is the ideal solution.
2. Reduce Financial Investment
If you choose a drop shipping companies or dropshipping sites from China to China for your upcoming e-commerce business model, you do not need to invest in warehouse space, warehouse management systems, inventory, shelves, forklifts, barcode scanners, insurance policies or other necessary equipment and resources. Since direct shipping suppliers are experts in production, packaging and shipping methods, you don't need to keep an eye on these important aspects.
3. Unlimited Product Portfolio
In the wholesale distributors in China, you can immediately access a wide range of products provided by a large number of wholesalers, manufacturers and other retailers, all of whom can cooperate with direct sales. From manufacturing to packaging and shipping, local suppliers take care of everything, so you can focus on other important tasks such as marketing and improving customer relationships.
Risks Related to Drop shipping from China
1. Product Quality
Experience has shown that direct shipping of electronic products from China involves higher quality risks than purchasing other types of products. Therefore, before starting an online business, you need to consider which products you plan to travel from China to and from China. It is recommended to conduct some research on wholesalers to ensure that your customers will not get inferior products.
2. Long Delivery Time
Another problem of Dropshipping from China is out of stock. This situation may occur when you place a shipment request but the product is sold out. During the Lunar New Year and other Chinese holidays, the delivery time may be extended to one month. This may affect delivery time and your reputation in the market.
3. High Competition and Low Profit
Another disadvantage associated with the decline in freight from China is low profits and fierce competition. Since drop shipping has almost no obstacles, many online retailers have begun to do so, leading to fierce competition. When using dropshipping, you cannot expect high profits from the products you sell due to the commission charged by the dropshipping supplier. This makes it difficult for entrepreneurs to differentiate them and make substantial profits.
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