e-Commerce Glossary · D-E

What Is Dropshipping?

A sales model used in e-commerce. In this model, the seller does not physically keep products in stock. When a customer buys a product, the seller passes the order to the supplier, and the supplier ships the product directly to the customer. This way, the seller bears no cost or risk related to inventory management and logistics. Dropshipping is a popular method for entrepreneurs who want to start with little capital, but it also comes with challenges such as high competition and low margins.