Dropshipping is a form of a retail method where you do not stock products. Instead, you enter into a contract or agreement with a wholesale supplier who stocks its own inventory and transfer customer orders and shipping details to them and ship the products directly to the customer who placed an order with you.
The biggest difference between dropshipping and the standard retail model is that shipping retailers do not always catalogue their own inventory or stock, but buyers buy this product from third parties to fulfil orders placed by the retailer and direct customer.
Most traders buy the product from the wholesaler or manufacturer directly.
Benefits of drop shipping business in india
- Low capital required: the biggest advantage of drop shipping business in india is that it is possible to start an e- commerce store without buying an inventory by starting up millions of rupees. Retailers usually have to buy a large quantity of the product in order to make the product available to the customer on the customer’s order from their stock.
But you don’t have to buy a product in drop shipping unless you have sold it to the customer. After the product has been ordered by the customer after the product’s money has arrived, you buy the ordered product from a third party and then reach the customer, so that you can start a successful shipping business with very little money.
- Easy to get started- if you are not confused with the physical product, running an e- commerce business is easier. You don’t have to worry about some of the following things at dropshipping
- To maintain a warehouse to keep the product,
- Packing and shipping the product,
- Check product order and stock inventory level, etc.
- Flexible location: you can also manage your e- commerce business as long as you are in contact with your customers and suppliers.
- Wide selection of products: since you do not have to buy a product in advance, you can supply the customer with multiple products.
How to start drop shipping business in india
When you start any business anywhere in the world, it is always advisable to have complete knowledge of the industry, such as how the industry works, you should be aware of the costs of running this particular business, legal formalities around the company, your competitors, the technological aspects of the company, the material aspect of the company and you should be aware of your ability to run this company.
The same applies to the drop shipping business in India. You need to have complete knowledge of this topic before you engage in this type of business.
Now, when you are done researching the drop shipping industry in India, you must make a business plan and mention such things as place of business, business entity, name of all the people associated with the business, money investment, marketing strategies, etc.
After you have created the business plan, you must first register your business by selecting a business entity such as llp, partnership, private limited company, opc, etc. Apply to the ministry of corporate affairs or you can also obtain a business registration under msme to start your business and you must also obtain a shop act license from the state authority. And when you’re in the drop shipping business in india, you have to get a gst service provider registration in India.
In the meantime, you should secure financing for your business; the business registration process will take some time to complete. Nowadays, you can get financing for your business through banks, financial institutions, gold loans and venture capitalists.
You should also note that when you register for msme, you should apply for the mudra loan under which you receive a mudra card, that you can use it to obtain a loan for the operation of the business or to fulfil any other financial requirement of the business.
Once you have dealt with everything mentioned above, it is time for you to start business operations. In order to do this, you should contact the e- commerce seller or create a website or list yourself as a dropshipper on the websites of the directory.
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