The evolution of trade on the internet in the 1990's produced brand new business models, one of which was dropshipping, a form of arbitrage allowing sellers to ship directly to customers without holding inventory. Today, dropshipping is a large industry, which serves to more efficiently meet the demand of customers all over the world by equalizing supply of products and pricing.
It all started with an American Retail Icon Company - SEARS in the 1950s, a mail order company that involved mailing catalog all over the country and using the mail to receive the orders and payments. Those orders were then fulfilled in-house or outsourced.
This is followed by the Just-In-Time Manufacturing (JIT), with an innovation helped to advance the dropshipping business model. During these times, retailers could take pre-orders and payments from consumer and pass it to the manufacturer for JIT Production. Within a few days or weeks, the manufacturer would produce and delivery to the retailer or to the consumer.
Dropshipping during Rise of E-Commerce
Today, we are in the midst of an ever-evolving era. We are in the Age of Experience, where almost everything can be done in just one click or a voice command. The feeling like a shopping mall is just right beside you that you can get anything you want and have it delivered on your doorstep, easy and hassle-free.
Retailers can now easily set up a storefront on their own website or use platforms like Amazon or eBay to manage thousands of orders.
Dropshipping evolved again with the introduction of sophisticated e-commerce tools like Shopify. It helped to connect manufacturers and retailers from across the continent and made information sharing instantaneous.
Here are the list of successful companies that offer dropshipping tools to manage orders, find new products, and message customers:
- Trackerbot - a tool to help you skyrocket your dropshipping business by automating some of the most boring and time consuming tasks.
- Mallabee - a tool to dropship & sync products, allowing you to manage your inventory via a lister/publisher, monitor and an order management system.
- Chili Tracker - 100% automatic tracking update system for your eBay account and time saving machine for dropshippers.
- Checkout Armenia - leading dropshipping startup company in Armenia that sells mostly electronics, smartphones, laptops and allowing you to purchase direct.
This business model has been advancing at an exponential rate. Also, along the way it gives birth to many ideas, tools, strategies and etc. that leads us into a better sight of our future.
- Optimization: Retailers are now up to optimizing the shipping rates and improvement of each SKU of the products they are listing/selling.
- Innovation: This whole process of making the profit thru dropshipping have become software-driven. From order fulfillment to the product listing, and almost all of its aspects. You can choose from a variety of software on any platform that will automate the day-to-day operations and run your business smoothly.
- Outsourcing: dropshipping generated millions of dollars that created a job of many freelancers across the globe hired as eBay Manager, Listers, VA or Admin Support.
- e-Learning: Tons of online courses are now scattered in the internet. It is a product of this successful business model that creates opportunity for some to create a manual and guide to follow for the beginners.
This is one good impact of dropshipping, where it creates a community of dropshippers that shares ideas and helps each other. These communities becomes the backbone of the dropshipping model since it creates a compilation of dropshipper’s success stories.