4 Differences Reseller and Dropshipper, Which is More Profitable?

Currently, the system dropship already rampant on various platforms E-commerce Indonesia. Similar way of working resellers, especially without having to provide initial capital making it a promising side business.

However, what exactly is the difference? drop shipper and distribution system using reseller? is drop shipper it's more profitable than reseller? If you want to know the answer, keep reading this article which will discuss in depth about the differences reseller and drop shipper.

What is Reseller and Dropshipper?

Reseller is someone who resells goods, promotes them, and keeps the stock of goods in a certain place. Whereas, drop shipper is someone who also resells things, promotes them, but doesn't need to keep things.

A reseller must buy the product to be sold first to beg or distributor. Meanwhile, a drop shipper no need to do it. Besides that, reseller need capital to buy goods, while dropshipper without having to spend capital.

However, if you look at how it works which has to buy things, isn't it reseller and drop shipper same? Well, there is a clear difference between reseller and distributors, namely from the amount of capital. Distributors usually spend more capital than resellers.

In addition, in the business chain, distributors will be directly related to manufacturers, while reseller uncertain. Simply put, try to remember this statement:

• Distributors can sell their goods to resellers, but stuff reseller cannot be purchased by distributors.
• Reseller can buy goods directly from manufacturers or from distributors. Reseller who buy goods directly from the manufacturer are reseller

Difference between Reseller and Dropshipper

Stock of goods

As previously mentioned, the most obvious difference between reseller and drop shipper is from stock. Reseller have to buy and provide stock of goods from beg before being sold and promoted.

Whereas, drop shipper only sell and promote goods without having to provide goods first. If there is a buyer, drop shipper will tell beg to prepare and ship goods.

Capital Amount

The second difference is the amount of capital. If reseller must buy goods first, then he must prepare capital. However, the capital issued is still not as big as the distributor. While for drop shipper no need to spend a penny of capital because he does not need to keep stock of goods.

Because reseller out of capital, usually the goods they sell have a price difference which is usually in the range of 20-50% of the purchase price. Well, from here reseller Get advantage.

Whereas, drop shipper there is no need to increase the price because he does not lose capital. Later, drop shipper will get a commission from the goods that have been promoted.

Profit

If it is calculated in terms of effort, well reseller nor drop shipper are actually mutually beneficial. However, if you look at the nominal numbers, it's certain reseller more profitable. This is because reseller will get a "special" price of goods from beg so it will be cheaper.

Not to mention that the price difference will be applied later by resellers. However, these profits are certainly proportional to the effort that has to spend capital and provide a place to stock goods. On the other hand, drop shipper you don't have to do all of that.

WL only need to promote the goods and of course, the profit from the commission is not worth the sales results resellers. However, remember drop shipper no need to go out of capital and prepare items like resellers, still profitable commission results.

Risks

Though reseller looks more profitable, but the risk is higher because it stores goods. If the item doesn't sell, it could be reseller will incur a loss. Reseller have to work harder so that the goods can sell and run out.

Whereas, drop shipper tends to be minimal risk because you don't have to worry if the goods are not sold. At most you will be confused by what kind of promotional strategy can roughly make the item sell.

Reseller & Dropshipper Advantages and Disadvantages

Reseller

Advantages

1. Can find out the actual number and condition of the goods sold, so that they can market the product in more detail.
2. Sales can be made in various options, either direct or online online through
3. Profit more profitable business.

Deficiency

1. You have to have the courage to venture out.
2. Reseller directly responsible for the condition of the goods, e.g. packaging, etc. Reseller it is also the one who makes the delivery of the goods if the service is available.
3. The risk of loss is greater than

WL

Advantages

1. No need to spend capital.
2. The risk tends to be small.
3. No need to be responsible for the condition of the goods.

Deficiency

1. Do not know the condition of the goods in real terms so that the notification of the condition of the goods can be only template standard conditions.
2. Profit smaller business than

How to Become a Reseller and Dropshipper in 5 Steps

Observe business opportunities

The main requirement for a businessman is to see a business opportunity, there is a gap that can be used to generate money. Eits, make no mistake! Even though “only” becomes reseller and dropshippers, does not mean you are lazy to run it.

What if the product you are promoting passes? dropship no one glances? In vain, haven't you tried to think of a promotional strategy to do listing item in marketplaces?

Then what if the shop reseller-You nobody visited? Of course you will lose big if your goods don't sell right? Therefore, observe carefully where the potential business gaps are. You do this by conducting market research and competitor analysis.

Define a promising product

After observing the business opportunity, determine what products to sell so that the business reseller and drop shipper so money. These two steps are quite crucial because when you are wrong, then the next step may not have a significant effect.

For example, after making observations, people turned out to be fond of eating healthy foods. From there, try to map out which healthy food products are crowded with customers, such as instant noodles without preservatives.

Cari beg right

After that, select beg the right one, aka choose a healthy instant noodle brand that has good sales. This is also important because if you choose a brand that is not very popular with the public, chances are your sales will not be too promising.

Determine a good marketing strategy

The main step has been taken, then the next step is to create a promotion that has the potential to make your sales sell well. For example, by selling goods on marketplaces, display product photos well, to offer promos.

This step is also quite crucial, because if you can't do a good promotion, the items that have been purchased may not be sold. Or if you dropshippers, Of course you will not get a good commission.

Sales evaluation

Finally, evaluate the marketing strategy that has been carried out. Whether with this strategy can generate good sales or not.

If yes, then keep it or if you can increase your creativity again. If not, then fix it and look for other strategies to increase sales.

So far, our discussion of the difference between reseller and dropshippers. As said, the two businesses are actually equally profitable when weighed in terms of Yago's defensive effort each.

If you want to be bothered, please try to be resellers. However, if you don't want to put in more effort, then become drop shipper just enough. So, which business do you want to try?

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