Wholesale branded dropshipping is a method of product delivery. It differs from a traditional retailer setup in that the retailer actually holds no inventory. The retailer is still offered wholesale prices for the items they sell, and they are free to mark them up as they choose and in the way that brings them the most profit. This is an increasingly-popular way to operate an online business and, in some cases, it provides one of the services that traditional retailers use to get their products to their customers.
Most retailers are charged with finding out what is likely to be a big selling item and then to purchase a quantity of those items so that there are products available in stock. This model is most effective for those businesses that maintain storefront locations. Obviously, such a retailer would fare poorly in the market if all of their customers had to wait for their order to be filled before they made their purchase. The model used by businesses who employ dropshipping resemble catalog shopping more than they do retail storefront shopping, though they are sometimes businesses that both carry stock and use wholesale branded dropshippers.
Most businesses that use wholesale branded dropshipping as their main means of supplying customers operate online. Many of them operate off of online auction sites, where the storefront and order processing is very cheap and easy to set up. This allows these businesses to go into operation fairly quickly. The advantage of drop shipping is that the business owner does not have to spend a lot of initial money on their inventory. They generally choose a drop shipping service that offers items that fit with their store and start up right away. The way the items are shipped eliminates the delay.
A wholesale branded dropshipper fills an order from their warehouse, using the seller's return address. When the customer places the order, the retailer makes an order with the drop shipper and the item is delivered directly to the customer. The retailer only needs to make the order and there is no additional handling of the order required on their part. This has obvious convenience value and eliminates the need for the retailer to have warehouse space and all the costs that are associated with having space set aside for a large inventory. This model is sometimes the exclusive means by which store ship.