Understand the ins and outs of Drop shipping

The Drop Shipping in eCommerce: Is it Possible to Sell Without Having Inventory?

That is Drop shipping.

Drop shipping is a system in Hong Kong that allows a retailer to sell to the final consumer without having inventory since the product is sent to the buyer directly from the supplier or manufacturer.

This system in Hong Kong is widely applied in e-commerce and catalogue sales, but retail stores can also use it for specific lines or brands of products that are not maintained in-store inventory, and only sold on demand.

How to apply the drop shipping in your business?

It is effortless. You are in contact with a supplier for a product that you are interested in marketing which comes with the option of drop shipping. In order to sell the products in Hong Kong a distributor would need to provide catalogues, descriptions, photographs and other marketing materials for the products.

Then you can promote these products and achieve sales through the mechanism you choose, be it your website, online marketplace or a marketing portal as if you were a distributor or independent vendor of that supplier.

Once the order has been obtained, and the payment has been confirmed, the distributor/manufacturer is informed of the buyer's data so that the product reaches its final destination.

This method is called point-to-point shipping, and the retailer acts as an intermediary between the manufacturer and the final consumer.

Advantages of using drop shipping

  • Absence or reduction of inventory with the corresponding elimination of the risk of obsolescence and expiration.
  • Physical space necessary for the inventory can be used for another activity, be it commercial or administrative.
  • It also reduces the hiring of personnel necessary for the management and control of inventory, as well as the preparation of orders as that is managed by the supplier manufacturer.
  • You can design your website for selling or take advantage of any of the existing platforms, such as Shopify, eBay, and Magento, to sell through their portals.

Tips for applying drop shipping in your online business

If you are considering to start an online store in Hong Kong, this method is a good option. The first thing you have to do is look for an excellent drop shipping provider. It is a crucial step because it must be a supplier with recognized prestige than a supplier who is not customer centric.

It would be the end of your business if, for example, the drop shipping provider that you have chosen does not comply with the quality or characteristics of the same, or in the worst case does not even send the product.

Once you have chosen the provider and you have established the selling platform, you can proceed to include the products on your web page or to the selected platform. Once all of this gets settled you can now start to promote the product.

The next step is to receive the orders and wait for the payment confirmation, once the payment is verified you must inform your drop shipping provider to deliver the product to the customer.

Hence, if your goal is to start an online store in Hong Kong and you do not have a significant budget to pull in your inventory, consider drop shipping as an efficient option.

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