Dropshipping

An e-commerce business model where you sell products without holding inventory, when customers order, you purchase items from third-party suppliers who ship directly to customers. This eliminates needs for warehousing, inventory investment, and fulfilment logistics. Dropshipping allows testing products with minimal capital and pivoting quickly based on demand. However, margins are typically thin (15-25%), you have limited quality control, shipping times can be long (especially from overseas suppliers), and competition is intense. Success requires finding reliable suppliers, effective marketing, excellent customer service, and often combining dropshipping with other revenue streams.

Why it matters

Dropshipping offers a low-risk entry into e-commerce, but it's not passive income. Success requires strong marketing skills. AI can help with product research, ad creative, customer service, and content creation to improve margins.