Term
Dropshipping/Drop Shipping
Drop shipping is a form of online retail sales where sellers do not have actual product inventory. In this type of business, a seller usually finds a supplier or a delivery partner that executes the product delivery on behalf of the seller.
Unlike multi-vendor platforms where vendors directly sell the product to the customers, in drop shipping sellers create a digital platform and invite customers to place orders with them. Once the order is received, the seller then contacts the supplier and gets the product delivered to the customer.
While in multi-vendor platform earns a commission for each trade, in drop shipping the seller creates a price gap and earns an arbitrary profit for each order that a customer places through their platform.
