Could it be profitable for an online retail store to work with the international drop-shipping model?

Answer by Syama Meagher:

could be very expensive and eat into your margins. Why?

Lets say you retail the item for $100. You might expect to only pay $50 for wholesale…but..

  1. Breaking Case Packs: Dropshipping already requires vendors to break case packs. They may charge you a flat fee for each order they ship out or might do it based on percentage
  2. Returns & Exchanges: International shipping is tough. Your vendor needs to ship to the customer, but if there are any issues with product, customer ships back to YOU not the vendor. Why? BC you want to own that relationship. You hold the customer service, otherwise that client might as well be purchasing directly from vendor. If you have to replace the item, you then need to send the product to the vendor and have them send a new one to customer. This takes time + money. Who pays for shipping? Customs? Duties?
  3. Dropshipping is not a deterrent to purchasing online. Customers will shop from you bc you are housing all kinds of products uniquely merchandised to them. You will offer the right prices, the right product, and speak to them in their voice.
  4. Think about alternative inventory management based on the product you want to sell.. How long will a customer wait for that product? 5 days? 14 days?
  5. Look into the internet laws in Egypt. Read this: E-Commerce in Egypt: A Market Overview

If you haven’t yet started looking at platforms to build your brand think of looking at Goodsie (Create an online store with Goodsie’s store builder. It’s easy and stylish!), Storeny (Storenvy)  or Shopify (Ecommerce Software, Online Store Builder, Website Store Hosting Solution- Free 14 day Trial by Shopify.) and make sure they accommodate international before you build out a customized platform.

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