Ep.55: What is Dropshipping And How Will It Change the E-Commerce Landscape in the Philippines

What is Dropshipping?

Dropshipping is the concept of being a reseller without investing capital. In Dropshipping, the merchandise will not go through you.

Strat Quad has been operational for 5 months. How long has Dropify been operational?

Dropify started on January 6, 2020. But in the short time that Dropify has been out, they have already garnered around a hundred clients.

Why do these people want to do dropshipping? What’s in it for them?

Before delving deeper into drop shipping, Charles gave us a bit of context about how it is successful in other countries.

In America, the majority of the population uses their credit cards when paying for online transactions. They pay immediately after their purchase. That’s considered drop-shipping because the customer was the one that paid for the product before the back-end people fulfill the order.

In the Philippines, most, if not all customers prefer cash on delivery. No one wants to shell out money before the product reaches them.

To be considered a drop shipper, you must not pay for anything during the process. In this case, the risk falls on the supplier. When the merchandise arrives, that’s the only time that the customer will pay Dropify which in turn serves as the middleman that pays both the supplier and the seller.

How does Dropify handle Payments?

There are two types of suppliers. Commodity or general items, and Brands.

Charles mentioned that brands have their own rules. They don’t like it when their pricing is changed and when their marketing standards aren’t met.

Dropshippers working with brands are more like agents. You get a commission of around 10% for the sales that you do.

Why would people choose to dropship with brands?

There’s a marketing principle called Flexicombo. This is when a seller markets bundles of different items with branded merchandise, increasing the overall value of that bundle. Some people like working with brands because they can increase the value of the other things that they sell.

Those who sell generic items can also receive incredible profit just by being smart and effective with how they market their products.

Essentially, drop shippers are salespeople and marketers. These kinds of people that don’t have the capital and don’t like the thought of bubble wraps and the waybills, can choose to be drop shippers and make it work.

How are the hundred drop shippers of Dropify?

The majority of Dropify’s Drop shippers are active. But their talents are extremely evident. Some of them are soaring high, some of them are slowly growing, and some of them are struggling with it. For Charles, dropshipping is really just another talent-based business.

What are the platforms that you use?

Charles emphasizes Lazada and Shopee, while Shopify and Woocommerce might still need a few negotiations, particularly with couriers. The processes are completely different. The money is with the couriers when it comes to cash on delivery. Working with couriers is a completely different ball game.

Support the show (https://tribe.leadershipstack.com/)