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what is the difference between ecommerce and dropshipping

Published on: February 9 2023 by pipiads

Dropshipping VS E-Commerce Wholesale (Which Business Is Right For You?)

hey, buddy, full family. my name is isabella, i'm the owner of two six figure online businesses and today i'm gonna be explaining the difference between e-commerce, store buying in bulk and drop shipping. you guys know i teach both of those types of businesses on my youtube channel, which is why i wanted to make a youtube video showing you guys the differences and the pros and cons of each. that way, if you're at a crossroads and you're not quite sure what business model you want to get into, hopefully by the end of this video you'll be able to make that decision. so let's get right into this video. so having your own store and buying involved and drop shipping are two different types of stores. drop shipping is when you don't have any products on hand and in buying in bulk, you obviously would- you would have to have a place in your house to keep them, like we do. i like having them in bulk because i like to make more videos, because content equals sales. the better your content, the more sales you're going to get, as long as you're marketing them through tiktok and instagram correctly. you do not have to buy ads. with dropshipping, that can be a little bit harder, because you do have to purchase samples. if you want to make your own original content, which i recommend, with dropshipping, you can always get content from the chinese suppliers, but it will never be as good as your own content. one good thing about buying in bulk and making your own content from out of your home and showing the products that you have on hand is that the customers wind up trusting you more because they see that you have a lot of products on hand in your videos. but, of course, if you guys have inventory, you guys will need a place to keep the inventory in your home in an organized manner, not only for your inventory, but you also need a place for shipping supplies as well. on the other hand, drop shipping, you're really only showing one product if you buy that sample, so there may be a lot of mistrust with the buyer. this is another reason why a lot of drop shipping stores wind up. failing is because there's just not enough trust to the customer. i think the most important thing is building a community around your brand, which is what we have done. if you guys have seen my instagram or my tik tac account is we've built a community around our brand. so even if our items wind up on amazon. one day, people will still want to buy from us instead of just buying on amazon. it's all about how you market the products. so if you guys are subscribed to my youtube channel, you guys know that we buy in bulk and ship our own products. we also manufacture and design our own products to make them stand out. i have videos about this on my youtube channel, so if you want to learn about that specifically, you guys can watch those tutorials. i actually have a step-by-step playlist that will show you guys how to do that as well. so you guys know that we like to have this business because we like to have control over our products and with buying bulk and shipping ourselves, we wind up profiting more, not only because we're able to get these items for a lower cost than if you were to drop ship, but we are able to make even more fun content since we have all the items here. you guys know content creation is the number one reason why our businesses blew up this year, and if it wasn't for me making tiktoks of my business, i would not be sitting here where i am today. and if you're new to this video, then you guys know i have tutorials on that as well of how you can do that too. i even have a video breaking it down with how we create our content, so you can check that out as well. so if you're interested in buying in bulk, you'll wind up using websites like alibaba or made in china. drop shipping, on the other hand, uses sites like aliexpress, since aliexpress is good for just buying one item at a time. with drop shipping, you don't have the products on hand. so if you're a drop shipper, you are basically the middleman. you find a product on aliexpress or on another website and then you advertise that product by making your own content, so the customer will buy that product from your website at that price and then basically, all you do is you go to the other website that you found the product on and you ship that product from the other website directly to the buyer that bought from your website. then you keep the profits. drop shipping and buying in bulk and keeping the items with you is a completely different experience. when you have items in bulk at a store like ours, you do wind up bonding with the customers and having a connection with the customers more than you would if you were just drop shipping. you're able to do a lot more customizations and do things like how you want when having your own store and buying in bulk. but i recommend drop shipping for anyone that wants to start with a zero dollar budget. that's actually what i did when i was 17 and 18 years old is i actually started my own drop shipping store and that's how i raised the funds to go to college and to be where i am today. when i was 17 and 18 years old, i wasn't really working with a big budget either, so i wound up starting drop shipping for zero dollars, not only because i didn't have money, but i just didn't want to risk anything. that's why my method of how to drop ship with zero dollars i think is great for anyone that's just starting out in the game. it allows you to gain experience and to to know how to promote products, and it just gives you so much experience without you really risking anything. but if your hearts in it and you have money to spend, i would definitely recommend buying in bulk, like we did. not only does it motivate you to get them sold when they're sitting in your house, but, like i said, you really do get to connect with the customer much more, since you are shipping the items yourself. it's tiknically a little bit more work than just drop shipping, but in the long run it's good. you guys know they also say that dropshipping sometimes can't have a long-term business model if you don't start branding it. and if you're someone that you started a dropshipping store and you are seeing consistent sales, that is when i would recommend you actually start and own your own store while buying in bulk. this is because you'll wind up profiting more, because you can get those products for a cheaper price when bought in bulk and you know that you have consistent customers so you can continue building your business from there. so i know a lot of you guys are remote or you like to travel and that's why you want to start drop shipping. but we actually love to travel too and we are able to get our business managed when we are gone as well, which i also have a video about on my youtube channel. if you're interested in learning if you're someone likes to travel but also wants to buy in bulk and have an actual store, i have a video about that on my youtube channel as well. but drop shipping is pretty nice, since you don't have the concept of actually having the products. i definitely think there's more of a reliable, long-term business model when buying in bulk and running your own store rather than drop shipping, which i've toked about in my other videos. but i still recommend dropshipping, especially if you're someone that wants to start with a zero dollar budget just to gain new experience and if you are somebody that you want to buy in bulk and start a business out of your home, like we have. do not let the shipping and handling part of all of that scare you away from wanting to do that. shipping your own products really is not that difficult. we spend about an hour to two hours every day packaging ours and we also get a lot of orders day to day, so it's definitely not as time consuming as you may think once you get in the routine. so back when i was 17- 18 years old, i wound up actually quitting on my drop shipping store because back then there actually wasn't as many us suppliers and shipping did take quite a long time. there was a lot of


what's up everyone and welcome back to my channel. i am jeremy and my channel is all about helping you start or grow your ecommerce marketing agency or your ecommerce store, and for those of you who are new here, i just want to inform you guys that i actually run and own my own e-commerce agency as well as my e-commerce store, which is exactly why i am here: to share my tips and strategies to help you grow your online business. so if you like the sound of that, then be sure to give this video a thumbs up, subscribe to my channel- if you guys have not already, and also hit that notification bell to be notified of each and every time that i post. now excuse my appearance in today's video. i am actually filming this before going to the gym, so i currently have no makeup on and i am in gym clothes, as you can see. however, as you guys can tell by the title of the video, i will be discussing the difference between drop shipping and an e-commerce online store- pros and cons to both of them. reason being is because i actually got message in regards to this question yesterday on my instagram and i just thought it was actually a great topic of discussion for like a video to film, so i said, why not film the video for you guys today? so that is exactly what i'm gonna do. so, without further ado, i'm just gonna jump right into the video, so i do not make this video lengthy and long. now drop shipping. what is drop shipping? i actually created a video, i think last year on drop shipping 101 for like drop shipping for beginners, so i'll link that up here somewhere. however, drop shipping is when you're basically the middleman in between the customer and the manufacturer, so you take the manufacturer or the supplier's product and you sell it at a much higher price, and then what you profit off of is the difference of what your, the manufacturer, sells it at and what you're selling it at. and, by the way, if you see me looking down here, i actually have my notebook where i have my notes for today's video. now, an e-commerce online store is basically where you are in control of everything. you own your inventory. you're not the middleman. you literally are in charge of everything. now let's jump into the pros and cons to just drop shipping first. now, the pros for drop shipping are that it's easy to start now. now, starting a drop shipping store is super easy to do. i mean all you have to do if you are very informative and well thorough at creating a website and just using gorgeous tiknology, drop shipping and starting an online store that way is super simple and should be super simple for you. all it basically requires is you to get a hosting site, built a website, and just finding products and importing the products onto your website. now the second pro to drop shipping is that it requires a low startup cost, aside from your marketing budget, of course, because everyone has different marketing budgets and marketing costs. however, to start a drop shipping store, it's very, very low startup cost, and what i mean by that is literally the only thing that you have to pay out of pocket up front is literally for your host, your site, that you're going to be hosting your store on your, your domain, and and maybe a little bit of a marketing cost, but again, that's based on your preference, because everyone is different. now, the last pro to drop shipping is that there is literally no inventory that you have to worry about. you're literally not in charge of any fulfillment. fulfillment and inventory is literally all taken care of, but by the supplier of who you chose, of what product you chose to basically market on your website. they take care of all of that. so literally all your customers are buying from your website, but directly from the supplier, and they take care of all of fulfillment for you. now on to the cons of drop shipping. now, one of the cons to drop shipping is that a lot of people, depending on what product is actually trending, can tell possibly that you are a drop shipper and they can actually mimic exactly what you're doing and possibly charge the products at a lesser price and kind of run you out of your show there. so i feel like that's a con to drop shipping is that you're most likely going to have some copycats and people mimicking your tactiks, your odds, because, especially now on facebook ad library, you can literally see the advertisements. any business is running, which is pretty neat, but also, you know, in this situation it might not be, so you definitely are going to have people mimicking you in copycats. now the second con to drop shipping is that the shipping is super long. now i remember i stated to you before within my drop shipping for beginners video that i actually had my own drop shipping store years and years ago, but in my opinion, i don't like the drop shipping business model. that's just my opinion. that's why i have my own ecommerce store now. but one of the reasons that's why i really don't like the drop shipping business model is because of the shipping time. the shipping time is extremely long and obviously, as you guys know, amazon is known for having amazon prime- like literally overnight shipping, because it keeps your customers satisfied and it keeps people buying more. now, for example, if you're selling a product and the suppliers in china or just overseas and you have customers purchasing your product from the united states, your product might be cheap but at the end of the day, if it takes the product like 20 days to 30 days to get here, almost a month to get here, the people are gonna forget about the product and they're most likely never going to buy from you again. so that is a con to drop shipping and i think it's one of the biggest downsides to drop shipping that there is now. the last con to drop shipping is that you're literally not in control of anything and that goes back to just like the shipping stuff and like customer service portion. so if you have customers that are messaging you like, hey, where's my product, you are kind of like in the middle. again, you're the middleman, wondering what you should tell and be of. you know service to this customer who purchased from you, because you have no idea about the fulfillment and you have no idea what's going on in the back end because, again, you're not in control. that's literally all up to the supplier, who who actually has the inventory kept on hand. it's not up to you. so that is definitely another con: to drop shipping, that you have literally no control over anything. now onto the ecommerce online store portion, the pros to having an ecommerce online store. now branding, so someone like myself- i have color lux. that is literally a perfect example of like an ecommerce online store. i have control over my branding and my imagery. i can take pictures of my products whenever i want to because i have all my inventory on hand. i can create videos. i can create content for my products whenever i want to. it's not that i have to rely on the supplier, because i have all my inventory here, so i don't have to rely on anything. now that leads me into the next one is that i am in control of literally everything with my online store. again, i have all my inventory. my inventory is literally right behind the camera and filmed all in a bookshelf. i literally have all of my inventory. i can do whatever i want with it. again, it's a huge perk because, since you are in control, you can do and play around with whatever it is that you want, as well as customer service wise. so if someone was to message you and say, hey, where's my package? you can quickly answer them and be like: hey, i actually shipped it out on such and such day. it should be receiving within two, three days or by the end of today. so being in control of your inventory definitely has its perks. now, the last pro to just having an ecommerce online store is just the fact that you have larger profit margins. the reason why i say this is because when you are first buying your inventory and your products, you're buying it in bulk, which you're getting at a much discounted price.

More:These 3 Shopify Stores Make Millions (Winning Shopify Store Designs 2019)

Dropshipping Vs Ecommerce - The Better Online Business Model

hey, it's Sam. welcome to more money, where money should be the only boring aspect of your life. if you're watching this video, then you're probably wondering what the differences are between drop dripping and e-commerce. well, stik around, because that's exactly what I'm toking about. [Music]. on my channel, I always release videos on digital marketing and passive income strategies, so consider subscribing also if you want. you can click on the link below to get access to my Recession Proof business model that'll teach you how to build an online business from the ground up. so don't worry if you have zero experience, because you'll get the best training that will make you the top marketer. great, let's get to the content. so if you're searching Drop Shipping versus e-commerce, then you're probably new to the make money online space. so the first thing you should know is that e-commerce is the broader term for doing business online, where there's going to be- or minus Harry- transactions that take place online. that's pretty much what e-commerce is, and Drop Shipping is just one business model of e-commerce where you're just buying and shipping products from the manufacturer or supplier directly to the consumer who bought the product and you don't have to see that product ever, and that's basically what Drop Shipping is. so that's exactly the difference between Drop Shipping and e-commerce, and that's probably the shortest answer I could give you, because that's because that's all there is really. but if you want to make money online, there's also a better way than doing Drop Shipping, which is called affiliate marketing, and affiliate marketing is basically just marketing other people's products and making a commission off of each sale that you make, then successfully. and the reason why I said is potentially better than dropping is because with dropshipping, you're gonna have to deal with a lot of complaining clients- customers- and you have to service them. you need to have good customer service and on top of that, you're going to have to spend thousands of dollars just creating advertisements and doing advertising yourself, right, or by hiring agencies that are out there that advertise for you, and that's going to cost a lot more money compared to affiliate marketing, where with affiliate marketing, you don't have to deal with complaining customers or have the fear of receiving one star reviews, because sometimes customers are just just bad. with Drop Shipping, customers are always right or else you're gonna you're gonna be threatened with a low rating. both affiliate marketing, you can Market however you want. you can put your own twists or create a style you want, where you don't really have to rely on selling to people. but if you're curious about affiliate marketing and you're starting to do research on it, well, be aware, like other business models online, there's going to be a lot of crap out there that you have to shift through to see which one actually works for you. right, because no matter what business you start online, there's always going to be people doing the incorrect way and not making a profit at all when they start, because there's a lot of misinformation out in the open and really you have to rely on information of people that actually did it well, did it right or actually made a profit. right, because ultimately, you want to make a profit too. if you want to learn how to start your own online affiliate marketing business, then be sure to click on the link down below, because you're going to learn how to do it the right way. there's a lot of crap out there that you want to stay away from, because they're going to teach you the simplest way as as fast as they can, but you're gonna generate zero income or even lose money if you want to learn how to promote things of value, such as information on teaching people how to solve their problems, whether it's making money, whether it's improving themselves, whether whether it's guitar lessons or learning how to invest in real estate. be sure to click on the link down below, because you're going to get free 40-day Builder training series that'll teach you the benefits of affiliate marketing and how you can get started. imagine being able to provide value to people, to enhance people's qualities and lives, and being able to make money while doing so is a really good feeling, because all you're doing is recommending products that will solve people's problems and, on top of that, you're collecting commission. by helping people solve their problems with these products. you're gonna learn how to pick and choose the best products to promote. you're going to learn how to build an email list for yourself and learn how to recommend even more products that that will help other people. so, with that said, I'll see you on the other side. thank you for joining me in this session. I hope you learned some valuable tips and tricks to begin your affiliate marketing career. you want to find out more about doing affiliate marketing the right way. consider subscribing to the channel like the video if you liked it, and hit the Bell icon to be notified when I upload a new video. for more tips, be sure to subscribe into my email list and get the 8 step affiliate marketing mastery guide for free, and I'll see you on the other side.

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Ecommerce business vs dropshipping

in this section, i'm going to give you a brief introduction to e-commerce, and in this lecture, i'm going to give you an overview of what e-commerce is and what drop shipping is. so e-commerce is uh, short for electronic commerce, and this is simply just buying physical products via the internet. so, whether you're buying something on amazon or ebay, um, and likewise, we're only going to see this style of commerce rise as the internet continues to grow, as retail stores continue to close and the convenience of e-commerce just continues to increase. um, more and more people are buying products from your phone and preferring to do that than physically going to the store, and this trend is only going to continue. likewise, drop shipping is a form of e-commerce. so drop shipping and e-commerce aren't necessarily the same thing. drop shipping is just a form of that. so, in other words, if i had a website where i sold, sold products- take ebay, for example- and i list something on there when i sell it, and then i pack up the product myself and ship it to them, that is not drop shipping, that is just standard in-house fulfillment. e-commerce, um, drop shipping is when, um, after someone makes a purchase from me, i actually don't physically have the product. i then purchase the product from the supplier and then ship the product from the supplier to the customer. so in this diagram i have um below. this isn't the best diagram, so excuse me for that. on the far left we have a website- someone makeup makes a purchase there, and then the owner of the website- and this is the center photo- now um makes a purchase from the supplier, who then ships out the product themselves to the customer. and that is the third photo- the customer receiving the product. so it's slightly different, um, and it's convenient because you don't physically have to have any inventory and this allows you to be mobile, allows you to move around um you don't have to be bogged down with by, like a warehouse, having, you know, hundreds and hundreds of products and, moreover, this allows you to um try selling new products instantly. you don't have to uh risk buying, uh you know a bulk order of 100 phone cases to see if it'll sell. instead, you can just drop ship it and see if you know it will sell, without actually physically having to own it. so drop shipping is great. that's what this business model is and it's uh pretty simple um and it's far less of a headache than in-house fulfillment. so that is the end of this lecture and i will see you in the next one. in this lecture, i'm going to discuss where you can go ultimately with the lee express drop shipping business model. so drop shipping sort of gets a bad wrap for being short-sighted and likewise being too easy to be a real business. so, in other words, people um see what you're doing, seeing that you're just a front, uh sort of for these products really express, and think you know this, this isn't a real business, this can't go anywhere. why would people actually buy these products from you instead of just going to aliexpress? well, first of all, we know that most people don't know about aliexpress. um, if you, or if you just go ask some random person on the street if they know what league express drop shipping is, or shopify drop shipping, they'll probably have no idea what you're toking about. moreover, if this business model's implemented correctly, you can- you can- get to the six and seven figure range annually with drop shipping. um, and most people who say that you know that isn't possible just haven't seen it before or they haven't done it themselves. likewise, um, i also uh want to explain a little bit about where you can go after you have a successful drop shipping business, um, because you don't have to just stop there. you don't have to just peek at the six, seven figure range where you're dropping from aliexpress, um. so as you continue to scale your business, um, and orders continue to come in, um, you can then move into in-house fulfillment, where you, uh are buying in bulk and then selling the product or shipping the products, rather from your house, and this will increase your margin, since you're not having to buy individual products melee express. likewise, um, if that ends up being too much work, you can get a fulfillment house. this will decrease the margin slightly, but you, you yourself- won't be shipping them out, which i mean if you have in-house fulfillment, you're doing hundreds of orders a day that can end up taking hours. so this might end up being the the next best bet. likewise, um, if your business is continuing to grow, you definitely want to start looking into white labeling and then branding the products yourself. so let's say that you're in the outdoor niche and you're selling flashlights and you're drop shipping these flashlights, um, if you have, or build up, such a huge customer base, you'll want to brand these fla flashlights yourself so that, what? that way, when people purchase a flashlight from you, it'll have your logo on it. people may ask them where they got it, and if you have so many customers, this will only help with referral marketing and allow you to get to the final stage, which would be distribution. and after you've branded your product and your business is continuing to grow and you've moved away from drop shipping and you're using a fulfillment- house or in-house fulfillment- with these branded products, then you can consider distribution, and this would be getting your products in actual stores. so some of you may heard of sunny coat clothing or, like the infamous red swimsuit. this is what they did. no, i'm not. i don't know, um, what their uh revenue or how much they sold the business that did that. if they were in this eight, nine figure range, this is just what's what's possible once you get to this level. so i don't know what their numbers were or anything like that, but this is the the path they went down, where, um, they branded drop shipped products from aliexpress and alibaba, then branded them themselves, uh, white labeling them. i believe they just did in-house fulfillment- i'm not sure, though- and then, as far as i know, you can get their swimsuits in stores, so they hit this distribution level. likewise, if you don't do any of that, you can simply just sell your store on empire, i think, empire flippers and flippacom or the shopify exchange, and attach this course. i'll have a pdf document you can view that will have all these resources that i discussed throughout the course there. so, um, again, if you're not at that six, seven figure range, don't ignore the express. aliexpress is powerful, providing you're using it correctly, and it can get to that six to seven figure range that you're seeking. so, um, i hope this clears up any misconceptions about this business model. or, um, if you weren't sure what the end game was with this business model, this is, this is how it can turn out. so that is the end of this video and i'll see you in the next one. you


[Music]. hey guys, welcome to my channel. so in today's video, I'm going to be explaining to you guys the difference between drop shipping and just buying wholesale, so if that's something that you're interested in, then please continue watching. before I get started, I want to give a subscribers shout out today. so today subscriber shoutout goes to angel sunlight. thank you so much for subscribing to my channel, and if you are watching this video, leave a comment down below and let me know what kind of videos you'd like to see from me, and I'll be sure it's a film, though. so now I'm basically just gonna explain what drops shipping is, in case some of you don't know, because I have gotten comments on mine. I have gotten comments on my video asking me about drop shipping. drop shipping is basically when you partner with a wholesaler that sells products that you want to sell on your online store. so whenever you receive a sale on your website, then you transfer that information- the customers information- over to the wholesaler, and then that's when they start processing the information for you. so you don't have to worry about like shipping the product or anything like that. you literally don't have to worry about inventory or anything, and that's one of the benefits about drop shipping. that's why so many people have gotten into drop shipping - even though it's a really competitive market. so with the drop shipping you basically don't have to order- actually order the item until the customer orders it. so that's another benefit - like, you're not just spending money on a whole bunch of inventory that may or may not sell, you're able to just purchase exactly what's needed and the customer gets it. and I also want to mention that the customer doesn't have to know that you are drop shipping. they don't have to know that you don't have any of the inventory or any of the stok, because there are even like big companies that do drop shipping but they don't say it. so it's not just smaller brands that do drop shipping, it's also big corporations as well that do drop shipping. so it's something that is reliable. but there will be times where you where a customer orders something on your website but it's out of stok, where a customer orders something but it's out of stok with your wholesaler. so you would just have to be ready to give those people a refund and just handle it as professionally as you can. so another one of the benefits is that you could offer like a wide variety of products to your customer without having to have all of those products within, like, your warehouse or your home or wherever you would usually have your merchandise. so that's another benefit about it and you don't have to worry about wasting money on inventory. most companies do offer drop shipping along with just a regular wholesale. so if you use Shopify, Shopify does have trusted wholesale vendors that you can use. they have, like, different apps and stuff on their website that you could just go on and you could just see different wholesale vendors that offer the products that you're looking for. because, just like with anybody who wants to start a boutique or anything who's trying to find a wholesale vendor, it is difficult to find wholesale vendors if you just search wholesale vendors on Google. for some reason- I don't know why, but it is so difficult. so I would definitely recommend using Shopify for your online store, just so that you can. is the camera shaking, okay? so wholesale now is basically when you partner up with a wholesale company and you just purchase items from them and it's like you're not purchasing them. when a customer orders that, you're just purchasing it right away, right off the bat. so when you're purchasing from wholesale vendors, it comes in a pack of usually six or eight pieces, and I'm toking about clothing items. I'm not sure how it would work for, like, bags or shoes or anything like that, but when it comes to clothing items, you'll receive like six or eight in the pack and I'll have like two large, two smalls and two mediums, or vice versa, like the sizes will be switched around or like maybe they'll have three larges and three mediums. it just depends on the company in the brand that you're shopping with. so with the wholesale vendors, you would have to worry about what you'll do with that merchandise that you purchased. think, basically, it all just depends on what you're looking for exactly. I think drop shipping is a good market to get into. if you don't really have like a specific brand that you really want to build, maybe you just want to do what's competitive in the market and what's really selling great at that moment and that's how you want to utilize your online store. but then I feel like if you want to build your own branding, your own company, then you should just go with wholesaling. or maybe you could just start off with drop shipping and see how it goes, see how you like it, and you could just switch over to creating your own or buying from wholesale vendors. yeah, and the- and I feel like it's really all up to you and what you're looking for as a company and what your end goal is. yeah, it's basically about your end goal and what you want, so let me see if there's anything else I wanted to mention. yes, so I feel like there are basically challenges and benefits within both of those markets. it just depends on what you're looking for as a business. either way, overall, the main thing that you would really have to focus on is marketing your products the right way, because, when it comes to having an online store, I think that some people kind of think, when it comes to having an online store, I think that some people kind of think that it's gonna be easy to sell things because a lot of people use online, because a lot of people shop online and stuff like that, but there are so many different things that go into it. so if you really want to have a successful online business, you just have to really know how to market your products the right way. that's really the key to making sales as a business. and when it comes to drop shipping: when it comes to drop shipping. I've notiked that it seems like a lot of people think it's really easy, but you still have to do a lot of sourcing and you have to do a lot of marketing in order to get people to get onto your site and to actually trust shopping with you. so it's also the same when you buy from a wholesale vendor and you're creating your own website and things like that. so I hope this video was helpful for you guys and, if it was, please give this video a thumbs up, subscribe to my channel down below and hit the bell to be notified when I do upload videos. I'm trying to upload more business related videos because I notiked that you guys seem to be more interested in those. so if there are any other things that you would like for me to film, then leave the in the comments down below. thank you guys, so much for watching and I'll catch you in my next video. [Music].

The Differences Between E commerce Fulfillment and Dropshipping (product fulfillment service)

today's topic is very interesting because it is about different between the e-commerce fulfillment versus drop shipping model. today will be my first time touching on drop shipping. it is because i find out that there are too many misconceptions people have towards the e-commerce fulfillments. whenever people find out, they will be the one who fulfill the orders they turn off by e-commerce model without knowing the pro and the cons behind the business model. so today i'm here to clear the air. all right, in today's sharing you will walk away with a following. the first thing is: what is e-commerce fulfillment? second, what is drop shipping? the the pro and the cons of e-commerce fulfillments and drop shipping. lastly, i will give you my vertikal. if you are quite new to the e-commerce, i wish to share with you two very good video to start off with. you could find it in the link below. the first one is the misconceptions associated with commerce business, and the second video is e-commerce business model explain. so i strongly recommend you to watch this video before you get a better understanding about commerce. if you're first time seeing me: hi, i'm vernet. i'm the e-commerce entrepreneur and e-commerce coach, coaching my students on how to start e-commerce journeys and how to grow their business. let's get started. what is e-commerce fulfillment? fulfillment is a process of fulfill orders in in your e-commerce store and ship the correct products to your customer on time. so can you imagine this process? a customer visit your online store, add a bottle of shampoo to the shopping cart and click the buy button. that online order will transmit into a pending order in your store. so someone you assign will pick and pack and ship the order. so who is that someone? it could be yourself, it could be your teammate, it could be your warehouse staff, it could be your fulfillment center that you assign to. for example, if you are doing amazon business, there is this amazon fulfillment service. it is not necessary. you must be the one who pack, pick and ship the order. as for all of my students who start their online store with shopping, shopping, logistiks partner will come to their house to pick up their package and ship for them, right? so this is the business model you can do as a home based business. you do not need to carry the passer and kill at the post office. that's an outdated model, right? so i hope my explanation to you is clear. next, what is drop shipping? so when you use a drop shipping business model. you do not have to purchase the inventory until your customer place the order. so, using shampoo as an example again, you might want to add a couple of new shampoo types to your online store. you do not want to tie up all your cash in the inventory, especially you are not sure how well the shampoo will sell. your shampoo supplier agree to produce the shampoo and keep a small amount on hand with him in his warehouse. whenever a customer place a order of shampoo, you will inform the supplier to ship the bottles of shampoo directly to your customers. so this is a very basic drop shipping fulfillment model. no fulfillment center, just you, your customer, and your supplier. that's all. who will pack, who will ship the order for you, your supplier? so by now you already have a very clear understanding of both e-commerce fulfillment and drop shipping. many of you may start wondering: oh, there's no brainer. drop shipping is much more hazard free. right, wait, allow me to share with you the pro and the cons before i share with you my plan for you. keep on watching pro at the cons of the emails fulfillment center versus the drop shipping if you think dropshipping sounds great and wonder why others would want to fulfill order any other way. like e-commerce fulfillment, dropshipping has the advantage of require small cash investment upfront. this is a very great option for people who have very tight capitals, as you are getting your e-commerce site off the ground, no hassle of entering the inventory and the storage- but more established e-commerce businesses. they might use dropshipping model to test new products. that way you won't be ended up storing three pallets of shampoo that no one is buying. so they are also downsides of drop shipping. yes, you save on out front investment, but your profit margin on each of the product is much smaller. so, for example, if you fulfill the order by e-commerce fulfillments, your profit margin is 50. now if you use dropship fulfillment, your profit margin can easily cut half to 25 because they are third party, which is your supplier that you need to pay to pay for the service of picking up the orders, pack the orders, ship the orders on behalf of you. in addition of that, you have less control over the shipping speed, over the course and over the quality of the fulfillment process. so, for example, if you are using e-commerce fulfillment center, perhaps your e-commerce fulfillment center my located in a place whereby it can ship to most of your customers with two days. where else, if you are using drop ship supplier to fulfill your order, it might take much longer shipping times and could be up to two weeks. so you can compare two days and two weeks. now, all right, with e-commerce fulfillment model, you do need to invest more cash upfront. your reward, however, is much higher profit margin. once you understand the demand of your products, you can adjust your inventory to maximize the profit while minimize the amount of money tie up your stok so you won't have a problem of cash flow problem. in addition, traditional e-commerce fulfillments give you more control over the whole fulfillment process. you can customize your packaging and you can choose from a broader range of fulfillment service to offer to your customers. so should you say that with e-commerce fulfillment or should you start with dropship? my verdict: well, there's no single answer, as it is totally depends on the types of business you wish to pursue from an e-commerce standpoint. if you have limited initial capital, limited e-commerce knowledge, start with dropship to test which product has a huge market demands. once you have a handful of winning products, open a niche store to sell those winning products using your own branding. if you have a capital to spend and already know which product is in demand for e-commerce fulfillment straight away. all right, to have a hundred percent control over your whole e-commerce business in terms of product quality, product branding, customer service, shipping speed. after all, five star customers experience is what you are looking for in today's famous world, and i have a course teaching e-commerce newbie on how to kick-start e-commerce using shopee, and if it is interested you, the link is below. good luck, that's my sharing for today and, as i mentioned, i would like to paste the two video and free shopping cost in the comments. thank you for watching.