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Dropshipping: the good, the bad, the ugly (and alternatives)

Posted on April 25, 2021
by Emma Burgess

In recent years, the number of orders being fulfilled via dropshipping has surged. So, what exactly do we mean by dropshipping, and why has it increased in popularity? We’re here to give you the good, the bad, and the ugly on this newly popular model. 

What is dropshipping?

Dropshipping is a retail fulfilment method that doesn’t require the store to hold its stock. Instead, when a store sells a product using the drop-shipping model, it buys the item from a third party and has it shipped directly to the customer. The seller never handles the product directly, and therefore doesn’t have to engage in the storing, picking, and packing process. To fulfil orders, the seller will purchase only the necessary stock from a third party when it’s needed. 

 If you’re a business owner, the process looks a little something like this:

The good: advantages of dropshipping

The view from your new dropshipping eCommerce office? Keep reading the article

The bad: disadvantages of dropshipping

However, it’s not all as great as it sounds.

Although no logistics journey is completely smooth sailing, there is an increasing number of obstacles that merchants selling via dropshopping face:

The ugly

Dropshipping ultimately takes away the responsibility from the seller to their consumer. Overall, the disadvantages to drop shipping includes errors in the product shipment, shipping problems, inventory issues, miscommunication, and low margins. If a customer calls the merchant to make a complaint or locate an order, the process is lengthy and often lacks the desired clarity – all the information for customer service is in the hands of the supplier.

Will the gifts arrive before Christmas with dropshipping?

Alternatives to Dropshipping

If you want to follow a model similar to dropshipping, you have some options:

From these options, half of them involve having stock. And actually having stock might solve at least half of your dropshipping issues.

Reducing stock costs

For dropshippers, having no stock saves money but is also a source of headaches. If you want to avoid the dropshipping disadvantages, you’ll probably need some stock.

If you don’t like the idea of keeping a stock in-house, you can save time and money outsourcing your fulfilment. See how Huboo fulfilment works:

  1. Add your products and your details to the Huboo Dashboard
  2. Ship your products to us – you can do this yourself or have your manufacturer send to us directly
  3. Huboo integrates with your eCommerce: customers order your products, and we take care of the picking, packing and posting. Sorted!
  4. You can see inbound goods, sales and fees in real-time on your dashboard
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If you don’t like the idea of keeping a stock in-house, you can save time and money outsourcing your fulfilment.

Which categories can a fulfilment center like Huboo fulfil?

A fulfillment company can usually fulfil orders from many categories. Some examples are: