Drop Shipping

Drop shipping is a supply chain management model in which a retailer does not need to hold inventory. When a customer places an order, the retailer passes the order information and shipping instructions directly to an upstream supplier (or wholesaler), and the supplier ships the goods directly to the end customer in the retailer's name. It is commonly used in cross-border e-commerce, independent websites, and social media commerce, especially for startups or sellers testing new products. Key considerations include: clarifying shipping lead times, neutral packaging, return and exchange responsibilities, and logistics tracking data feedback with the supplier; preventing the supplier from including its own promotional materials in the package; and paying attention to different platforms' shipping time requirements. The difference from traditional wholesale is that drop shipping does not require the retailer to purchase in bulk or hold stock, and inventory risk is borne by the supplier. It differs from third-party fulfillment, which usually refers to a third-party logistics company storing and shipping goods on the retailer's behalf, whereas the core of drop shipping is that the supplier ships directly and the retailer does not handle the goods.