B 250 Lesson 2 Weekly Reflection

Disclaimer: this post is written for the 3 Oct 2015 Weekly Reflection assignment, even though it is posted on 10 Oct.

This week the narrative assignments continued. And I learned about the existence of drop shipping!

We compared drop shipping and affiliate marketing this week for class. I had already been exposed to affiliate marketing. In affiliate marketing, you basically set yourself up as an independent salesperson for another company. They handle the actual transaction and shipping, but you get a cut of the sale for providing the lead.

Drop shipping is another way to avoid inventory. With drop shipping, you only purchase an item from the distributor after you have made a sale, and the distributor ships it directly to your customer. I’ve read The Goal by Eliyahu M. Goldratt, so I know inventory is a bad thing. I suppose drop shipping is the next logical step in reducing it.

But I wonder, if your drop shipper is in China and your customers are in the U.S. near you, do the shipping costs soar when you ship individual items overseas, rather than shipping them in bulk?

10 October 2015